Pandora (P) Does the IPO Shuffle
Tweet
Share
E-mail
Get Alerts P Hot Sheet
Join SI Premium – FREE
While the IPO debut of Pandora (NYSE: P) could be considered successful on various metrics, trading in the stock was anything but... unless you were short.
Shares of the red-hot offering opened at $20 per share after pricing at $16 and immediately surged to an intra-day high of $26. Those levels proved unsustainable and the slide commenced: $25...$23...$21. Before you knew it shares cracked below the opening print and the selling never let up.
Shares ended the day at $17.42, near the lows of the session.
While retail investors who got in after the open were hurt, those who got in at the IPO price of $16 are still sitting pretty even if they didn't flip their shares.
The pattern in Pandora followed similar patterns seen in other recent hot IPOs like LinkedIn (Nasdaq: LNKD) and Renren (Nasdaq: RENN). Shares open significantly above the pricing, trade near the highs around open and then it's all downhill from there.
Shorts, which are normally hard to find for an IPO, were readily available at various brokerage firms Wednesday according to trading sources. This could have added to the downside.
Based on the closing price of $17.42, the market cap of Pandora is still considerably lofty at $2.8 billion. This value has been given to a company that hasn't even smelled anything close to a profit, raising eyebrows with skeptics. Last quarter the company posted sales of $51 million and a loss of $6.73 million. Since its inception in 2000 the accumulated loss is $92.1 million.
Investors are putting hope on the company’s strong 77 percent member growth.
Tomorrow could prove to be an interesting day as the underwriters seek to defend the $16 syndicate price.
Shares of the red-hot offering opened at $20 per share after pricing at $16 and immediately surged to an intra-day high of $26. Those levels proved unsustainable and the slide commenced: $25...$23...$21. Before you knew it shares cracked below the opening print and the selling never let up.
Shares ended the day at $17.42, near the lows of the session.
While retail investors who got in after the open were hurt, those who got in at the IPO price of $16 are still sitting pretty even if they didn't flip their shares.
The pattern in Pandora followed similar patterns seen in other recent hot IPOs like LinkedIn (Nasdaq: LNKD) and Renren (Nasdaq: RENN). Shares open significantly above the pricing, trade near the highs around open and then it's all downhill from there.
Shorts, which are normally hard to find for an IPO, were readily available at various brokerage firms Wednesday according to trading sources. This could have added to the downside.
Based on the closing price of $17.42, the market cap of Pandora is still considerably lofty at $2.8 billion. This value has been given to a company that hasn't even smelled anything close to a profit, raising eyebrows with skeptics. Last quarter the company posted sales of $51 million and a loss of $6.73 million. Since its inception in 2000 the accumulated loss is $92.1 million.
Investors are putting hope on the company’s strong 77 percent member growth.
Tomorrow could prove to be an interesting day as the underwriters seek to defend the $16 syndicate price.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- CoVolt Power files for proposed IPO
- BofA's Hartnett sees dollar slump, risk selloff if bond intervention fails
- Anthropic hires Google chip veteran as it pushed into hardware - Bloomberg
Create E-mail Alert Related Categories
IPOs, Trader TalkSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
