Ralph Shao

Zynga To Delay IPO Because of Market Conditions

I can’t say I fully understand this. Can the market not bear a correctly priced Zynga? With Zynga’s amazing 4.4 cent ARPDAU, what does it matter if the market is rocky? At the end of the day, if Zynga’s revenues can be sustained, then it’s a great company to invest in.

There’s this huge and false misconception that if a company’s stock jumps after an IPO that it’s a good thing, but it’s not. It’s just hysteria! If a company cannot justify the financial performance of its stock price, then it deserves to have a dip. If Zynga isn’t prepared to deliver performance that warrants an IPO of $15-20 billion, then it’s not a good company to invest in regardless of market conditions. But if they can, then they should be poised to outperform.

29 August 2011 ·