…if I wrote “priceless” who would be madder, Visa or Mastercard? (I am in my hotel room on business travel mucking about so I though I would add a bonus post this week.) The final price for the Visa IPO is $44/share which is $2 more than the initial maximum share price. Public trading starts today. Following up on my initial post last week on the Visa IPO, this would push the p/e to close to 30. This is an extremely high valuation (can you think of any mature company this size growing 30% a year?).
Who is one of the lead underwriters in the VISA IPO? JPMorgan Chase. Who is the largest bank shareholder of Visa? JPMorgan Chase (who pocketed a reported $1.25 billion). Who has the biggest slice of the underwriters’ estimated $500 million pie? JPMorgan Chase. Who just paid hundreds of millions to bail out then buy Bear Stearns (albeit with very cheap money from the government and at 1/15 the market value)? JPMorgan Chase. Hmmm…..someone needed to increase the pricing of Visa shares to pay for some recent expenses.
I read into this pricing jeux casino gratuibonus de casino en lignejeux de planche a roulettejeu gratuitesvideo poker en lignecasino jeucasino achat en lignefree crapsjeu baccarat en ligne gratuitesjeu de hasardloterie en lignejouer stud pokerle meilleur poker en ligneseven card studjeu poker gratuijeux frle poker téléchargement gratuitesapprendre texas holdemtélécharger le jeu de poker gratuitesregles poker ouvertjeu poker macstrip poker virtuelapprendre a jouer au pokerla règle du jeu de pokerregles du poker texasjeu poker internetcomment jouer au pokerjeu de poker gratuitstournoi de poker gratuitespoker en ligne gratuites texastelecharger poker texastournoi poker gratuitespoker a telechargergagner poker onlineworld poker tournamentsites poker en lignejeu flash gratuitesplay 7 card studpoker texas holdem en lignejeu video pokerpoker en ligne gratuitesjouer poker tour gratuitespoker holdemregles du jeu du pokerjeu poker freewarejeux tour de pokermalette de jeu de pokerjouer poker en ligne gratuitespoker tour reglesjeu online poker tour that the IPO market will be flat to non-existent this year and Wall Street grabbed with both hands with the only sure-thing IPO this year (not to mention that a lot of brokers could be laid off after public trading commences today- the VISA IPO could be the last kick at the can for a lot of traders, not that I am shedding any tears). Probably another reason to avoid the hysteria today.
I wanted to end my post today with a mea culpa. You may have noticed I inadvertently posted both guest posts on the same day. I seemed to have lost the ability to count this weekend when I was posted both contributions with the same time-stamp and didn’t catch it while traveling. Apologizes to both Expat and Mom2KG; both excellent pieces should have been posted separately for the readers to enjoy. I hope to get them both to post again in the near future.
March 19th, 2008 at 8:12 am
TMW, so what are you saying, we should all buy shares in JPMorgan Chase?
March 19th, 2008 at 10:37 am
No biggie about the double post.
As for Visa – who keeps track of JP Morgan’s various debts and exposures? How will it report on its equity and debt there? Please tell me regulators are sitting around the boardroom table for this IPO. Like UN observers.
What would happen, theoretically, if JP Morgan went under? Would my Visa card stop working?
March 19th, 2008 at 12:39 pm
Visa is trading at $60 now. I’d like to own a piece of Visa but PE multiple of 15-16 may be more reasonable considering the franchise. Warren Buffett’s American Express is trading at 13 PE.
March 19th, 2008 at 12:40 pm
… Mastercard is trading at 26.68 PE.
March 19th, 2008 at 12:44 pm
Visa opened at $65/share and has gone down since then. Seems like people are taking their profits.
We’ll have to wait a couple of months before us “normal” investors see the true valuation of Visa. Too much of the trading is being done by the institutions and professional traders now.
March 19th, 2008 at 4:34 pm
Here’s a total layman’s view on the value of VISA shares: Forget your P/E ratios, valuation and/or allocation of revenue from the IPO… focus on market frenzy & hype, that often – at least in the short term – seems to override calm, analytical consideration. That alone should be enough to bolster the stock price (again, at least in the short term) until emotion settles down. Then again, doesn’t Google have a P/E ratio of something like 60?