Visa plans to sell more than half of itself in IPO
— -- Visa is hoping investors will open their wallets and shell out more than $16 billion for what's expected to be the biggest U.S. IPO ever.
More than three months after filing plans for an initial public offering, the leading credit card processor Monday provided the much-awaited price and number of shares it expects to sell in its IPO.
If things go as planned, shares of Visa should be trading by the week of March 19. The IPO is expected to garner attention because it is:
But investors hope Visa's stock will do as well as MasterCard's. MasterCard shares have soared more than 400% from their initial price of $39 in May 2006. MasterCard shares fell $5.03 to $198.45 Monday.
Visa isn't a screaming bargain like MasterCard was, says Francis Gaskins of IPOdesktop. Visa's price-earnings ratio (stock price divided by earnings per share), based on the middle of its price range, is 30 times its annualized fiscal fourth-quarter earnings, he says. That's well above MasterCard's 21 P-E now and its 11 P-E at its IPO, Gaskins says. "Is this another MasterCard? The answer is no," he says.
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