Thirty minutes after Google opened, its stock price doubled. This trend was simply a dream start.
For those who subscribed for Google shares in advance, if they sell now, their profits will exceed 100%!
At this moment, there are countless people holding coins in the Nasdaq venue waiting to take orders. The volume of buying orders is surprisingly large, but the trading volume is very small.
There have been few transactions, prompting the rising trend of stock prices to continue.
In the 60th minute after the market opened, the stock price rose by more than 130%, triggering a circuit breaker once again.
Not only are stock investors crazy, but even Google shareholders are crazy.
For example, Larry Page, after the listing, still held 31.2% of his personal shares. According to the IPO price, before the opening of the market, his worth was almost US$15 billion.
But now, his net worth has reached 34.4 billion U.S. dollars, and the growth rate is so fast that it is simply unbelievable.
However, one thing is very embarrassing, that is, Larry Page will not be allowed to dilute his shares in the next two years.
In other words, all his stocks cannot be traded or transferred, and the US$34.4 billion is like a fixed deposit and cannot be withdrawn.
Moreover, even if it can be withdrawn after two years, it can only be withdrawn bit by bit, and it is never allowed to cash out all or large sums directly.
From this point, we can also see how wet the Internet industry is.
Although Larry Page is now worth $34.4 billion, his actual personal assets may only be around $100 million.
If Google develops smoothly, when its net worth rises to US$50 billion in two years, it may be able to cash out 5% and have several billion US dollars in cash.
But if Google continues to be in trouble, his worth may drop to 3.4 billion in two years.
From US$34.4 billion to US$3.4 billion, it may only take a year or two, and during this process, Larry Page cannot sell stocks, and at most he can only make some equity pledges.
Moreover, the equity pledge of U.S. stocks carries great risks for the pledgers. Once the market value drops too much and the money is not paid, not only the shares will be withdrawn, but also the voting rights corresponding to the shares will be withdrawn. Personal money is used to enjoy life, and the company belongs to others.
So overall, if the company cannot develop a long-term stable growth path, no matter how high its value is, it will continue to shrink sooner or later.
Now, what depresses Larry Page and these Google shareholders the most is this.
The stock price has soared, but it will have nothing to do with me for a while.
Want to get some cash and live a good life? It will have to wait at least another year or two.
However, for those investors who subscribed for Google shares in advance, today is really a carnival. As long as they want to sell, they can cash out at any time.
…
Subsequently, the upward trend of Google's stock price slowed down slightly.
At 11 o'clock in the morning, an hour and a half had passed since the market opened. Google's stock price was fluctuating up and down, all the way to the $170 line.
At this time, the stock price was close to $192.8, an increase of more than 140%;
The difference between Nasdaq and China is that there is no break in between, so the stock price has been rising slowly amid fluctuations.
By one o'clock in the afternoon, the stock price exceeded US$200, an increase of more than 150%;
At two o'clock in the afternoon, the stock price exceeded 220 US dollars, an increase of more than 175%;
The entire Wall Street went crazy, and so did the American media. All the media were reporting on Google's stock price. At this time, Google's market value had surged from US$48 billion to US$132 billion.
Even Li Mu was a little dumbfounded.
If Google can secure more than 100 billion US dollars, then Makino Technology's market value will exceed at least 500 billion or even 600 billion US dollars on the first day of listing.
However, in Li Mu's view, it is definitely impossible for Google's stock price to reach a high of more than 100 billion US dollars so early.
The reason why today's stock price is high is because of Concept, Makino Technology, its own endorsement and capital. It won't be long before the stock price will definitely calm down.
Sometimes, this is how Wall Street plays. A stock that can tell a story and play with concepts goes public. They try their best to attract funds, first stir up the stock price, and then attract retail investors to chase the rise. When retail investors chase in, they slowly sell out. When they were almost ready to ship, the stock price naturally began to fall, and then retail investors were bought in.
Li Mu's ideal value for Google's market capitalization is around US$70 billion. This is due to his constant support. Without his support, it is estimated to be only US$34 billion at most.
The same was true for Qutoutiao when it was first listed. It rose nearly 200% on the first day, and the stock price reached a high of 20 US dollars. However, it fell to more than 3 yuan not long after, which is terrible.
But Google's stock price is stronger than Li Mu expected.
I thought the stock price would start to fall near the close, but unexpectedly, the stock price still maintained an upward trend.
As of half an hour before the close, the stock price reached $232.8, an increase of 191%!
Google's market capitalization has soared from US$48 billion to US$139.7 billion, only a little away from breaking through US$140 billion.
At the close, Google's stock price experienced another wave of gains.
At this time, the stock price stayed at $248, an increase of more than 210%!
The market value exceeded US$148.8 billion. On the first day of listing, the market value increased to US$100.8 billion!
Larry Page even couldn't believe it, and whispered to Li Mu: "Mr. Li, the stock price is too high..."
Li Mu smiled slightly and said: "Such a big battle is an excellent opportunity to make money for the capital that participated in advance. Of course they will add fuel to the flames."
As he said that, Li Mu added: "Fortunately, the market value before the IPO was relatively high. It is difficult to lift it up when it is large. If the market value was 30 billion at the time of the IPO, it can rise to 300% today."
Larry Page smacked his lips and said: "It seems very prosperous. Only people who know the industry know that all the money has been made by those capitals and institutions. I don't have a single circulating stock in my hand..."
Li Mu said with a smile: "I estimate that Wall Street is such a mess, and their media that serves capitalists will continue to advocate Google after the market closes, and try their best to inflate Google's bubble even more. Maybe tomorrow the stock price will soar. The price has reached a new high of US$250 per share. By that time, I don’t know how many retail investors will be deceived and tricked into taking over.”
Larry Page nodded.
The level of the stock price actually has little to do with the company's performance.
If it is closely related to the company's performance and the company only issues financial reports once a quarter, then the stock price should fluctuate every quarter.
In fact, the stock price is supported by the fundamentals of the company's performance on the one hand, and external capital advocacy on the other.
The fundamental purpose of external capital advocating for a company is not to make the company develop better, but to make money for itself.
They hold Google stocks and naturally hope that these stocks can bring them the greatest benefits.
Where do the benefits mainly come from? It means shipping at a high level.
It's useless just because the stock price is high. You have to sell it when the stock price is high to make real money.
First, use the media to wildly praise Google, making the public think that Google will be the Internet company second only to Makino Technology in the future, and make the public think that the company's future stock price can reach 300 billion U.S. dollars or even higher.
At this time, out of an investment mentality, people will come in to take over the offer, and then wait for the stock price to double.
However, after capital is shipped at this price, the stock price will fall quickly. At that time, the people who are waiting to double will realize that they have been cheated.
Larry Page also knew the tricks of these people and was already a little irritable at this time.
It's like going on stage to sing an opera, and others heat up the performance, inflate the tickets, and then take away all the ticket money.
After I performed a few performances and was finally able to collect tickets myself, the popularity of my performances was no longer so high, and the actual value of the tickets also dropped. Maybe people who bought tickets at high prices would come and scold me. What the hell? ? I bought a ticket for $300, and you’re selling it for $50 now
For some small companies, their ability to go public depends on the backing of capital. They are inextricably linked to capital, so they are willing to cooperate with capital and let capital take advantage of retail investors to make money.
But for large companies, if capital first engulfs retail investors, it will have a somewhat negative impact on the corporate image.
Li Mu has lived more than ten years longer than Larry Page, so he is well-informed. He has seen many "monster stocks" on U.S. stock IPOs.
For example, the super abnormal stocks soared by more than 250% or even 300% on the first day of IPO, so I have seen many very interesting CEOs. When faced with the skyrocketing stock prices, not only were they not happy at all, but they warned investors with serious faces. As investors, your own stocks are not worth that much, so please buy with caution.
This kind of thing happened not once or twice on Nasdaq.
As mentioned before, during the IPO, shareholders of the company are not allowed to reduce their holdings. No matter how much the stock price rises, they will not be able to cash out. If the stock price rises too high, when it falls, people who took over at a high position will definitely be lured in. In that case, it will affect the company's reputation.
Take Google, for example. It rose to US$248 per share today. If it drops to US$160 tomorrow, many people who took over today will suffer heavy losses.
At that time, they will vent their anger on Google.
But Google also suffered a lot of losses. It didn't make any money itself. Before it went public, it issued 50 million shares at a price of US$80 per share and sold them to underwriters, who then sold them to their customers.
Now, the stock price has risen to $248, which basically has nothing to do with Google.
The current carnival is, on the one hand, the market's recognition of Google, and on the other hand, it's because others are borrowing their stocks and their market prices in preparation for planned looting of another wave of people.
Li Mu reminded Larry Page: "When reporters interview you later, remember to remind everyone that Google's stock price is not worth such a high price, so that everyone can treat it rationally."
Larry Page was stunned and blurted out: "Does this offend capital?"
Li Mu asked him: "Are you scared?"
Larry Page said awkwardly: "Not really, I just think... it might be a bit inappropriate..."
Li Mu said: "I see this trend. If the national media continues to advocate Google's skyrocketing today, and the market is confident, the stock price will soar even higher tomorrow. What will you do then? With Google's current business scale and income level, market value To more than 130 billion US dollars, the price-to-earnings ratio is already several hundred times higher. If it doesn’t fall back, there will be trouble.”
Larry Page thought for a moment and begged: "Mr. Li, why don't you tell me? The stock investors will trust you more!"
(End of chapter)