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Originally posted by bdjuf
but how does the bank evaluate the money? what aspects of the company make the bank set that specific price?
can they value a stock at more than the company is worth in assets? (company is worth 500 000$, they releast 2.5 million $ of shares)
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its a complicated analysis, a lot of factors involved, growth for instance, also, is the company planning on paying dividends, or are they going to re-invest thier retained earnings to increase the growth rate, etc etc, list goes on and on.
My partner and a couple of our employees are ex-investment bankers, just hearing the work stories made me cringe, one field I'm glad I never got into.