The recent release of Facebook's S-1, the financial filings that are required to be publicly available prior to filing an IPO, has created a media frenzy. The report has been dissected and analyzed extensively, financial news networks can’t seem to stop talking about it and it seems that people who have never heard of an IPO are discussing it, fittingly, on their Facebook pages. The most controversial issue, of course, is whether Facebook is actually worth $100 Billion.
Although Facebook is unique in its global reach and ubiquity, the starting point for any valuation is to compare it with similar businesses. I have chosen Apple and Google, given the similarity of their business models and their respective global dominance, to compare certain key metrics:
Since Groupon first submitted its S-1 filing in June, 2011, there has been a wave of negative sentiment around Groupon’s upcoming IPO. Many analysts believe that not only is Groupon not a good investment at the approximate $20 Billion + that its IPO’s initial share price will value it at, but is in fact on the brink of insolvency. They are also some that do not believe that, in the long run, Groupon’s business model is profitable .
In an effort to determine whether Groupon is in fact a raging buy or, as alternatively presented, on the verge of insolvency, I have undertaken an analysis of their latest S-1 , which was filed with the SEC on August 10, 2011. The document, which is required by all companies who want to file an initial public offering, comprehensively reviews its operations, long term viability, business risks (which are numerous) and its financial condition. Some of the more interesting discoveries, as they relate to the 6 months ending June 30, 2011, are presented below:
As evidenced by their most recent quarterly filing, American Apparel's continues to grapple with financial issues. Despite its strong brand recognition (among a host of accolades, they were named "label of the year" by The Guardian in 2008), it's reputation as a trendsetter, and it's provocative advertising, they are struggling to survive. The company lost $9.5 million in the 3rd quarter of 2010 (alone) compared with a profit of $4.2 million for the same period in 2009. Exacerbating the problem is the resignation of their auditors, Deloitte and Touche, in August, 2010 who claimed that there were "potential material errors in the consolidated financial statements for 2009". This has become the subject of an official FBI criminal investigation.Read More