by: Shanthi Rexaline, Benzinga Staff Writer
The IPO waters are still muddled and troubled, extending the lean patch seen in 2016. Although the year started with much fanfare, with the promise of some delectable offerings, none of 2017's new entrants have lived up to expectations yet.
Yogaworks Inc YOGA, which debuted last Friday, hasn't had the best time, just days since its listing. The company, which provides high quality yoga instructions in the U.S. and boasted about 3 million student visits in 2016 offered 7.3 million shares in an IPO, priced at $5.50 per share.
Souring From The Start
The preliminary offering range was $5.50–$6.50 per share. Having raised gross proceeds of $40 million, the company's shares began trading on the Nasdaq under the ticker symbol YOGA on Aug. 11.
The shares were listed at $5.5, but moved between a high of $5.85 and a low of $4.16, before ending at $4.85, a 12-percent discount from the offer price. After its first four trading days, the stock is down 21.95 percent.
The S-1 filing revealed that the company had annual revenues of $55.09 million in 2016, with the March quarter revenues at $14 million and net loss at $2.61 million.
The negative reception to the IPO isn't restricted to the company alone, as two of the high-profile IPOs of the year are under water now.
Snap Inc SNAP, another of this year's IPOs, currently trades under $13, way off its offer price of $17 per share. The company's wobbly fundamentals aren't giving buyers conviction to buy into the stock.
According to a survey by Social Media Examiner, only about 7 percent of advertisers have used Snapchat in the first quarter.
The stock closed last at $5.50. However, the shares saw a small boost this week after activist investor Jana Partners revealed in the 13-D filing that it has picked up a 2-percent stake in the company.
Apart from company-specific factors, macroeconomics and geopolitics are also pressuring the IPO market. The U.S. is experiencing a policy paralysis, as uncertainties loom large concerning the fiscal stimulus and radical corporate-friendly reforms initially hoped for from the Trump administration, particularly with the disbanding of the president's manufacturing council and policy forum. The recent rhetoric against North Korea is another case in point, which led to a steep sell-off in the markets.
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