How to Win the SnapChat IPO Without Buying the Stock

thincsocial.com (Coming Soon)

@thincsocial

twitter.com/thincsocial

 

04/06/2017

 

The two leading underwriters of the SNAP IPO ($SNAP) recently were noted as Goldman Sachs and Morgan Stanley. A close third position was JP Morgan. It is important to follow how many shares each one offered and how each of those investment banks made off because of the IPO. Snap Inc is seen as a loser, namely because it has actually lost almost a billion last year. They spend way too much and have not yet found out how to capture their extremely young audience ad dollars. A lot of young people use Snap… And as a side note lets be real, they are not a “Camera Company”. They are a photographic social media company using real time technology.

Morgan Stanley led the way. Which is why they are the featured stock of this story. How do you beat a loser in the market when they launch their IPO? Buy the underwriter. In this case Morgan Stanley as the lead will make the most money from the offering because of fees charged to Snap for the process and how much they had to offer to funds and insurance companies.

“According to SEC filings, lead underwriter Morgan Stanley got 60 million Snap shares, or, 30.2 percent of the shares given to underwriters — which would mean $25.71 million in fees, the biggest cut of any bank”.

This is big because when it comes to quarterly earnings, especially year over year (YoY) Morgan Stanley should see a jump in earnings due to the slow growth of the IPO market from last year. So take a look at the numbers and perhaps Morgan Stanley is the real winner here.

One last thing to note: Saudi ARAMCO Oil deal scheduled for 2018 is also expected to have Morgan Stanley lead the deal, and will be if it goes through the largest IPO ever valued at pre-IPO around $2 Trillion. For more info on the Snap IPO, check out the links below.

 

** In interest of full disclosure the author does own shares in Morgan Stanley (MS), but not Snap (SNAP). **

** Please check out a prospectus and look at your own risk before investing in anything, if you choose to. **

Featured image photo credit: snapchat.com

 

Articles used to back up stats:

 http://work.chron.com/ipo-underwriter-do-3841.html

http://www.cnbc.com/2017/03/03/snap-ipo-what-wall-street-banks-made.html

http://www.cnbc.com/2017/03/02/snaps-going-public-heres-how-an-ipo-actually-works.html

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