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Unformatted text preview: internet, as long as the firms changed the name to .com, their share price elevated. The equity value of web-related firms inflated a lot during the period. The share price was clearly unreasonable and the investors werent rational. They would pay whatever price in order to invest in web or .com firms. Since the share price of other internet firms was already skyrocketed, it was highly likely to see the stock market over-valued the web-related IPO. Plus, a change of name to .com brought a 40% increase in stock price to a non-web-related firm; the over-value of a real web-based IPO would be even greater....
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This note was uploaded on 02/18/2010 for the course FBE FINANCE taught by Professor Callahan during the Fall '09 term at USC.
- Fall '09