Will You Buy GoDaddy Stock? | DomainInvesting.com
101 Domain

Will You Buy GoDaddy Stock?

17

Market Watch reported that GoDaddy hopes to “raise up to $418 million” in its initial public offering. The report stated that the company plans to offer shares priced somewhere between $17-19, although I would imagine that number could change as the GoDaddy IPO gets closer. Based on the IPO numbers, the company market cap would be “approaching $3 billion.”

I am uncertain about whether I am going to try and have my financial advisor get an allocation of shares when the company goes public. I also don’t know if I am going to purchase shares of the company once its starts trading on the New York Stock Exchange (under the ticker symbol GDDY).

I am not much of a stock picker, but one thing I know is that a stock’s performance doesn’t necessarily jive with the company’s products and services. There are many factors that play into the valuation of a stock and how it trades, and just because GoDaddy is good (or bad) for you doesn’t mean you will make money with the stock.

Deciding whether to buy the stock is much different than simply being a customer. I think customers can get a good idea about a company and its operations simply by being a customer, but without doing research, it’s not easy to know if a company’s stock is priced fairly or is going to drop.

I am curious to know if you plan to buy GoDaddy stock once it begins trading on the NYSE. Feel free to share your rationale in the comment section.



About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has sold seven figures worth of domain names in the last five years. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest.


Reach out to Elliot: Twitter | | Facebook | Email

Comments (17)

    Jeff Edelman

    It’s a pretty dangerous game to play around with IPOs, so I don’t plan on looking into doing anything with the stock around the IPO. But I’ll be watching and wishing them well.

    March 19th, 2015 at 10:51 am

      Elliot Silver

      It will be very interesting to watch the valuation after the initial IPO action.

      In reply to Jeff Edelman | March 19th, 2015 at 10:53 am

    anonymous coward

    -Too full valued and subject to a possible tumble.
    -Market is frothy in general
    -Tired regisstrations systems and constant upsell machine is ripe for disintermediation by the “next thing”
    -Hosting business is vulnerable
    -Better places to put cash to work with less downside risk

    March 19th, 2015 at 11:57 am

    David M

    I received an email about this from loyal3.com. Does this seem legit? What other options are there for investing in this IPO?

    March 19th, 2015 at 12:31 pm

      Elliot Silver

      Received an email about what?

      In reply to David M | March 19th, 2015 at 12:48 pm

      David M

      About Loyal3 offering access to GD’s IPO. I didn’t think that anyone can buy into the IPO through a regular brokeraage company; Scottrade, Ameritrade, etc. I mean I know that I can buy it on opening day, but I always thought the IPO was offered privately first. Am I wrong in my thinking?

      In reply to Elliot Silver | March 19th, 2015 at 5:51 pm

      Meyer

      I don’t know about Godaddy but the typical arrangement is –

      A group of underwriters (which is a syndicate of investment banks) sell the domains to their best clients, top mutual funds and institutional investors. And, they are the ones that resell the shares to the financial market. Your chances of getting shares directly from the underwriters is about the same as winning the lottery.

      If you place an order just as the shares hit the market, you will generally get the lowest price of the day. But, you will have to place the order as ‘at market price’.

      Good luck.

      In reply to David M | March 19th, 2015 at 6:41 pm

      Meyer

      Sorry about the typo above.

      “sell the domains to their best clients,”

      I meant – sell the shares to their best clients.

      I guess I think about domains too much. :)

      In reply to Meyer | March 19th, 2015 at 10:43 pm

    Acro

    As with every investment, after performing a thorough research of its potential, should be managed with funds that in excess of living expenses. The GoDaddy IPO carries years of anticipation and it could well produce a sizable return for those investors that participate in it. Subsequent trading should help define the trends for the GoDaddy stock. It would be interesting to see how the stock responds to future “situations” related to the Registrar.

    March 19th, 2015 at 1:01 pm

    DOMAINer

    I personally feel that this is a very risky investment and the stock is more likely to go down and will remain down right from the start.
    GoDaddy is a market leader when it comes to domain names but then again, most of its customers buy at $1 a domain.
    Plus, they tend to migrate to other registrars when the prices are down.
    Hosting business is perishable and there are better players in the hosting game.
    Therefore, I anticipate a huge risk in investing in GoDaddy IPO.

    March 19th, 2015 at 3:07 pm

    Meyer

    An IPO (before and after) will force GD to maximize their profit first, revenue second and reduce expenses third. And, where do you think the profit will come from?

    March 19th, 2015 at 4:00 pm

      m

      “Ding! Ding! Ding! – buy that man a cigar!”

      In reply to Meyer | March 19th, 2015 at 5:35 pm

    RU

    I voted ‘Yes’

    March 19th, 2015 at 6:42 pm

    DNsale

    Godaddy is faithful brand for me. I would surely do.

    March 20th, 2015 at 7:14 am

    Alex

    I think godaddy will go up at first, if you look at the past few tech IPOs they all shoot up initially and stay up for a week or so then fall down

    March 20th, 2015 at 5:21 pm

    Brad

    They continue to lose 100+ million dollars year after year. Just b/c they collect the money up front for paid in advance services doesn’t change anything. Yeah they have positive cash flow b/c they collect $$ for someone who prepays their hosting account for 5 years. Well they have to hold onto that cash for 5 years to pay for the data center, salary expense etc. to run that server for 5 years. They have grown into a large mature company and still aren’t making a profit.

    They don’t have a ton of growth opportunity like smaller start ups do. They are going to grow 10-20% per year, but how many more years. They are using the money they collect now to pay for the people who prepaid their stuff years ago. I’m not saying they are a ponzi scheme by any means, but that is what poniz schemes do, use the new money to pay for the old obligations.

    Yes they will (hopefully for the love of god) eventually earn a real accounting profit but I don’t think there should be any expectations at all that this thing shoots to the moon. When you are that big you can only grow so much…..and the lack of profit. Bottom line is they have been in business long enough to where they should be making an accounting profit.

    March 21st, 2015 at 9:51 pm

Leave a Reply

Name *

Mail *

Website