The author has an 8-9 bagger already with TSLA. That's the real reason why he can sleep at night. Obviously a lot larger risk buying in now.
So if you bought into AMZN you would have a 5 to 50 bagger. Or you could just sit around and complain all these years that it is over priced. I remember people saying UA was over valued at 1b market cap; whoops.
Think the main point people are missing is "future" value. Nobody starts at sales of 50b a year; you have to build that up over time. Companies that have great prospects will always trade at super premiums because they are most likely to succeed. And conversely you have "bargain" stocks with single digit P/Es that carry lots of risk . Now you tell me which is the better buy in those 2 extreme cases.
NKE market cap is almost 5x of UA so what's the point of comparing the 2?
UA is the new "trendy" sports wear brand that all the kids want (think of Nike 20-25 years ago). It bodes very well for long term prospects. All stocks are valued for future performance, not current or past. UA stock prices will have its ups and downs like every other stock, but it's very hard to find a stock that in 10 years I can guarantee will be worth more than it is now.
This is done all the time on NYSE when a company is spun off. The pre-spinoff shares are traded ahead of time to create a stable market price on the shares for the when the spinoff takes place. The pre-spinoff shares will just convert over/have a symbol change. Never experienced it on a NASDAQ but I would imagine it's more or less the same process.
You bought a +50% IPO within 10 minutes of trading and already thinking of bailing? I hope you put a little more thought into other trades and investment decisions you make.
The buyout is for cash (fixed) and stock (variable). All the $37b numbers being reported are based on AVGO closing price yesterday. There is most likely a ratio that has been agreed upon; every x number of BRCM converts to y number of AVGO shares. It's not a straight cash deal of $z/share.
Stocks are always valued for future and not past or even current prospects. The consensus belief is that this company is more likely to continue it's previous trend into the future, and thus trades at a premium compared to companies that are considered more risky, or less likely to perform. If you look at companies like Microsoft, Cisco, Google in their major growth days, they always traded a high premium for the same reasons. Look at the historical chart for UA. Aside from some major market downturns, it has never traded cheap. Yet if you bought into in years past you would be doing quite nicely now.
So why would people want to sell you their shares of UA for cheap? They don't and here is where you get your premium. You'll never get in early on a potentially mid to large cap (and miss out on all the big gains) if you are locked into basic trading metrics. The numbers for companies in their growth stages are obviously not going to be the same as a GE or KO.