Loading...

Messages

Proposals

Stuck in your homework and missing deadline? Get urgent help in $10/Page with 24 hours deadline

Get Urgent Writing Help In Your Essays, Assignments, Homeworks, Dissertation, Thesis Or Coursework & Achieve A+ Grades.

Privacy Guaranteed - 100% Plagiarism Free Writing - Free Turnitin Report - Professional And Experienced Writers - 24/7 Online Support

Rosetta stone inc case study

14/04/2021 Client: muhammad11 Deadline: 2 Day

ROSETTA STONE: PRICING THE 2009 IPO We are changing the way the world learns languages. —Tom Adams Introduction In April 2009 Rosetta Stone management was considering an initial public offering of Rosetta Stone stock during one of the most difficult periods in market and capital-raising history. Rosetta Stone provides an unique language-learning strategy and was a pioneer in developing a whole new market in language-learning. Their strong financial performance allowed them to consider going public during a difficult financial period. At the time of this case, managers are in the process of valuing the stock using various corporate valuation strategies, and making the decision on whether to go public. Purpose In development of this case, students will review the institutional aspects of the equity issuance transaction, explore the costs and benefits associated with initial public share offerings, develop an appreciation for the challenges of valuing unseasoned firms, develop corporate valuation skills, specifically using market multiples, and evaluate related the financial anomaly of IPO underpricing. Case It was mid-April 2009. Tom Adams, president and CEO of Rosetta Stone, Inc. (Rosetta Stone), the language learning software company, reached for his iPhone to contact Phil Clough of private equity fund ABS Capital. Adams and Clough had been discussing plans to take Rosetta Stone public for some time. The wait was finally over. In the wake of the 2008 financial crisis, the market for initial public offerings (IPOs) evaporated. By early spring the market was showing its first encouraging signs. Just a week prior, Chinese online videogame developer Changyou.com had listed on the NASDAQ at a price to EBITDA of 6.5 times followed by a one-day jump of 25%, and the online college Bridgeport Education was currently circulating its plans to go public at a range of 10 to 12 times EBITDA. Having received preliminary approval of its registration filings with the U.S. Securities and Exchange Commission (SEC), Rosetta Stone was authorized to sell 6.25 million shares, a 30% stake in the company. Exhibits 1 and 2 provide financial statements from Rosetta Stone’s IPO prospectus, required by the SEC to inform investors about the details of the equity offering. Half of the shares were to be new shares and the other half were shares to be sold by existing shareholders. Rosetta Stone management had circulated an estimated price range of $15 to $17 per 1 share, representing a price to EBITDA of about 8 times. Demand for the shares was strong, and some analysts believed that Rosetta Stone was leaving money on the table. Yet with world financial and product markets still in turmoil, there was a strong case to be made for prudence. Economic Conditions The previous year had been a dramatic one for the world economy. Prices on global credit and equity markets had been in free fall. The U.S. equity market was down over 50% from its peak in October 2007 (see Exhibit 3 for details of the recent price history of U.S. equity market returns in total and for select industries). The collapse of world financial markets had preceded deterioration in economic activity worldwide, including dramatic shifts in real estate values, unemployment levels, and discretionary consumer spending. The severity of economic conditions had prompted massive intervention by world governments with dramatic policy changes, particularly by the U.S. federal government. The economic and political conditions were frequently compared with those of the Great Depression of the 1930s. In February and March of 2009, there had been some evidence of improvement in financial and economic conditions. Wholesale inventories were in decline. New-home sales were beginning to rise. The equity market had experienced a rally of over 20% in recent weeks. Yet many money managers and analysts worried that such economic green shoots were only a temporary rally in a longer-running bear market. There was strong concern that the magnitude of government spending would spur inflation in the U.S. dollar. GDP growth was still negative, corporate bankruptcy rates and unemployment were at historic highs, and many believed the economic void was just too big for a quick recovery to be feasible. A Wall Street Journal survey of U.S. economists suggested that the economy was expected to generate positive growth in the last half of 2009.1 In contrast, a survey of U.S. corporate executives stated that less than a third of respondents expected to see an economic upturn in 2009.2 The debate regarding the economic future of the world economy raged on.

Homework is Completed By:

Writer Writer Name Amount Client Comments & Rating
Instant Homework Helper

ONLINE

Instant Homework Helper

$36

She helped me in last minute in a very reasonable price. She is a lifesaver, I got A+ grade in my homework, I will surely hire her again for my next assignments, Thumbs Up!

Order & Get This Solution Within 3 Hours in $25/Page

Custom Original Solution And Get A+ Grades

  • 100% Plagiarism Free
  • Proper APA/MLA/Harvard Referencing
  • Delivery in 3 Hours After Placing Order
  • Free Turnitin Report
  • Unlimited Revisions
  • Privacy Guaranteed

Order & Get This Solution Within 6 Hours in $20/Page

Custom Original Solution And Get A+ Grades

  • 100% Plagiarism Free
  • Proper APA/MLA/Harvard Referencing
  • Delivery in 6 Hours After Placing Order
  • Free Turnitin Report
  • Unlimited Revisions
  • Privacy Guaranteed

Order & Get This Solution Within 12 Hours in $15/Page

Custom Original Solution And Get A+ Grades

  • 100% Plagiarism Free
  • Proper APA/MLA/Harvard Referencing
  • Delivery in 12 Hours After Placing Order
  • Free Turnitin Report
  • Unlimited Revisions
  • Privacy Guaranteed

6 writers have sent their proposals to do this homework:

Smart Homework Helper
Innovative Writer
Math Specialist
WRITING LAND
Quick Finance Master
Top Class Engineers
Writer Writer Name Offer Chat
Smart Homework Helper

ONLINE

Smart Homework Helper

I have read your project details. I can do this within your deadline.

$29 Chat With Writer
Innovative Writer

ONLINE

Innovative Writer

Hello, I an ranked top 10 freelancers in academic and contents writing. I can write and updated your personal statement with great quality and free of plagiarism

$33 Chat With Writer
Math Specialist

ONLINE

Math Specialist

Give me a chance, i will do this with my best efforts

$35 Chat With Writer
WRITING LAND

ONLINE

WRITING LAND

Give me a chance, i will do this with my best efforts

$45 Chat With Writer
Quick Finance Master

ONLINE

Quick Finance Master

Give me a chance, i will do this with my best efforts

$41 Chat With Writer
Top Class Engineers

ONLINE

Top Class Engineers

You can award me any time as I am ready to start your project curiously. Waiting for your positive response. Thank you!

$49 Chat With Writer

Let our expert academic writers to help you in achieving a+ grades in your homework, assignment, quiz or exam.

Similar Homework Questions

Medieval social system crossword - Tennis ireland tournament software - Free leadership legacy assessment test - Nonviolent communication marshall rosenberg pdf - 2 naphthol fecl3 equation - Lpc scale measure leadership style - HSE 8 - International finance questions and answers - SOC Ch 9 - I wanna be in america west side story lyrics - Quadratic equation in java source code - Executive assistant to general manager - Excel gantt chart exclude weekends - Risk assessment on Acme Enterprise - Ethics - Spiritual considerations surrounding a disaster - Which global enterprises employee used to work for the los angeles police department? - Glo bus presentation - Does abouse in the home cause juvinel crime rates to be higher - Compare and contrast descriptive and inferential statistics - Covid 19 - T test spss independent samples - Oral history interview essay example - Everything begins and ends at the kentucky club summary - Cold formed steel header - Training tracker south warwickshire - Limiting reagent balloon lab answers - Economic damage due to cyber attack - Outline american literature - Ops 571 week 6 signature assignment - Sensory perception assessment questions - Paul hartley vocational assessor - Emotional development of early adulthood - Cannot make their own food - Danger of a single story summary - Reflection - Psychology diffusion of responsibility - Super size me movie questions answer key - This or that - Fire hydrant box checklist - Monte carlo simulation in capital budgeting - Myiptest com staticpages index php how about you - Translational research graphic organizer example - 600 words 3 hrs - Holiday leave accrual myob - Booker t washington vs web dubois essay - Occupational therapy interventions for multiple sclerosis - Http musicfestival cesa catholic edu au - Case study 8 1 klm airlines - Compound machines science olympiad - What is a critical review - General mills organizational culture - Comparing mass year 2 - Praxis test dates tennessee - Culture in Nursing DQ 1 week 5 - 300 words - How many km is in a light year - Quiznos mission statement - Ucl office 365 login - Rhetorical analysis on cdc adhd - Chapter 20 print advertisements worksheet answers - Negative effects of social media influences on mental health - Servsafe cooking temperature chart - Case study Suzy - IT for Managers - Westpac future leaders scholarship - The way to wealth - Hurren corporation makes a product with the following standard costs - Organ leader and decision making - Weighted marginal cost of capital - Sobe adrenaline rush energy drink ingredients - Fast food restaurants - Anatomy drill level 1 anatomical models heart structures internal view - Accounting 201 Rephrase in own words - Anti oppressive practice in social work - Bbc scotland comedy shows - Spykiller2 internet cut off switch - Creativity games random word generator - 2016 vcaa specialist exam 1 - Palomar hospital internship - Personal Driver Dubai Monthly – Reliable & Affordable Chauffeurs | SafeDriveU - Http www esri com data esri_data ziptapestry - Written codes of ethics for health care practitioners - What is the value of the digit 4 in 964 - Leadership Development Plan - How to read literature like a professor chapter 24 summary - Dni worldwide threat assessment 2018 - Treasury stock is ________. - How to quote a stanza in mla - Capstone -SWOT- 2pages - Co teaching models handout - Plumb line posture landmarks - Bcvr entries - Pre tax cost of debt excel - POL 201 American National Government NO PLAGIARISM PLZ This will need be a topic for Final paper - Harvard marketing simulation minnesota micromotors solution - Www getgemms com without human verification - Ball state men's volleyball - Specific purpose of a speech example - As nzs 4815 current edition