Presentation: You should include numeric analysis (if use printouts of Excel worksheet, apply necessary format and alignment) and your interpretation listed in the outline.
Analytical outline: https://www.sec.gov/edgar/searchedgar/companysearch.html
The purpose of this study is to gain more insights into the mechanisms of IPO markets and the principal issues that IPO market participants commonly face, based on publicly accessible data.
1. Selection of an IPO
From the company Centrus Energy Corporation you have selected above, complete the table above for 1st DAY RETURN, 3 YEAR RETRUN and 5 YEAR RETRUN (you will supply other information about the company later on).Enter the Ticker of the company into Yahoo! Finance to check if the company is still actively traded as of the day being selected.
2. Why would Centrus Energy Corporation company go public? Was the time right to do an IPO?
Based on the Ticker of the company, find the Form S-1 and Form S-1/A (or Forms SB-1 if for a small firm) IPO prospectus from EDGAR's website: https://www.sec.gov/edgar/searchedgar/companysearch.html
Note: Forms S-1 requires companies to provide information on the planned use of capital proceeds, detail the current business model and competition, as well provide a a brief prospectus of the planned security itself, offering price methodology, and any dilution that will occur to other listed securities. Many firms fileForm S-1/A, which is used for filing amendments to a previously filed Form S-1
Read through the IPO prospectus (Form S-1 and Form S-1/A if available), in particular, look into the "Management Discussion and Analysis (MD&A)" section to examine the business plan. Discuss why such an IPO was deemed to be necessary by the firm. Any insights about the company's view of market opportunities, industry environment (products, competitors), risk and uncertainty (business, legal, financial)?
3. What advisors the firm hired?
Record information about consultants, auditors, layers, underwriters, and printers if any.What are the costs/fees for them? Which one you believe placed the most important role during the preparation of the IPO? Since we are examining retrospectively, was there any seasoned equity offering after this IPO? If so, did the company use the same underwriter?
4. What was the Offering Price and number of shares offering? Was there any changes before the actual listing?
5. How did the market react to the IPO?
1) The short-run IPO return
Find the ending price when the market started trading, and calculate the one-day return from the offering price to the ending price on the first trading day. What was the 1st day return of your IPO Company? Were there money left on the table?
2) The long-run performance
From Yahoo! Finance, find the Adjusted Ending prices for: first trading day, three years after the IPO listing day, and five years after the IPO listing day, and calculate 3-year and 5-year post-IPO holding period return (HPR) using Adjusted Ending prices.
What was the HPR of your IPO Company over 1 year post IPO? What about 5 years post IPO?