|Bid||45.60 x 800|
|Ask||47.50 x 800|
|Day's Range||45.91 - 48.80|
|52 Week Range||36.00 - 59.82|
|Beta (3Y Monthly)||N/A|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||48.50|
This San Francisco company not only priced its IPO $3 higher than its original pricing range but surged 76 percent on its first day.
Several IPO stocks have been on a tear lately as innovative products fuel booming sales. Most aren't profitable, but Wall Street doesn't seem to mind.
When a company debuts on the stock market for the first time, it can offer promise or peril. How can an investor tell if a hot IPO is worth jumping into?
During the past few weeks, Chinese electrical-vehicle manufacturer Nio (NYSE:NIO) has been in the fast lane. Nio stock up about 40% or so to $3.50. Yet the shares are still well off their highs. The stock was more than $10 in late February. Click to Enlarge Source: Shutterstock It's also important to keep in mind that the company is a recent IPO. Yet it certainly hasn't enjoyed the enthusiasm of many other operators like Zoom Video Communications (NASDAQ:ZM), Anaplan (NYSE:PLAN) and Pagerduty (NYSE:PD).But hey, IPOs can certainly make nice comebacks, right? So with Nio stock, might there be one brewing? Or should investors be skeptical?InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Dependable Dividend Stocks to Buy A Closer Look at NioWell, there are certainly some positives. Keep in mind that the sentiment for Nio stock had gotten to horrible levels. Thus a bounce back is reasonable. And there was probably short covering (this is when short sellers buy back shares to cover their positions). As of late June, about 15% of the float for Nio was shorted.But there were also some fundamental factors at work. Perhaps the most important was that the second quarter saw a pick-up in deliveries, which came to 3,553. This was above the company's quarterly guidance of 2,800 to 3,200 (albeit, this forecast was fairly conservative). In June, NIO also launched its ES6 five-seater premium SUV and the results were encouraging. Deliveries were 413.But despite all this, there are still some negative factors, and I think they could easily outweigh the positives. For example, Nio recalled more than 4,800 units of the ES8 (or close to 30% of the total deliveries for the company's history). The reason: There were three battery fires. Nio Recall WoesIt's encouraging that Nio has been proactive. Let's face it, the auto industry can be resistant to recognizing problems. Yet the recall is still something that points to quality issues, which is never a good thing for a premium vehicle. It also does not help that there are already general worries about EVs.In fact, the company's business model, which relies on the manufacturing of the vehicles from another company, could be an issue. That is, there could be more vulnerability to quality issues as Nio does not have as much control.But there is something else about the business model: It means that the margins are quite low. In other words, it could be tough for Nio to realize the benefits of the economies of scale as the company grows. And yes, this could be limiting for the stock price.It also does not help that Nio continues to burn money. During the latest quarter, the operating loss was a hefty $366 million. But the cash on hand is only about $1.12 billion and the debt load is $1.35 billion.In light of this, it would not be surprising to see another equity raise - and this would mean more dilution for the stock. Bottom Line on Nio StockEven though the Chinese government has been cutting back on subsidies, there still is considerable support to promote the EV industry. This is definitely good news for Nio stock.But then again, the company has to fight fierce competitors like BYD (OTCMKTS:BYDDF) and Beijing Electric Vehicle Co. Consider that there are nearly 486 registered EV manufactures in China! So it will be tough to stand out. It also does not help that the Chinese economy is slowing down, despite efforts to stimulate growth.All in all, there's quite a bit of risk with Nio, and it's probably best to hold off for now.Tom Taulli is the author of the upcoming book, Artificial Intelligence Basics: A Non-Technical Introduction. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Dependable Dividend Stocks to Buy * 10 Stocks Driving the Market to All-Time Highs (And Why) * 7 Short Squeeze Stocks With Big Upside Potential The post Nio Stock Isn't Cheap When You Factor in Competition and Recalls appeared first on InvestorPlace.
The top two in PitchBook's second-quarter ranking aren't investors that most people would think of as the region's top startup backers.
Noise traders tend to buy high and sell low, as Milton Friedman said, but they can still dominate markets. And they can also go broke individually.
Across the globe, 23 startups achieved unicorn status in the second quarter, of which 19 are in the U.S. Bay Area startups accounted for nearly half of all unicorns created worldwide.
Two growth stocks putting up great results and another that's out of favor but still delivering -- here's a trio you need to look at right now.
The $165.2 billion exit value from IPOs and M&A; in the first half of this year has already surpassed every full year total on record, according to PitchBook Data and the National Venture Capital Association. Here are the Bay Area's 10 biggest exits in Q2.
The cloud-based enterprise software company that uses artificial intelligence to offer customer predictions and insights revealed its IPO pricing range Monday, with its valuation coming in a tad below its last funding round.
About 15 percent of the companies in the U.S. that have gone public so far in 2019 are led by female CEOs, the highest number in at last six years and triple the number of woman-run companies listed in the Russell 2000.
Shares of business-to-business SAAS (software as a service) companies like Slack and PagerDuty have outperformed consumer tech firms.
Uber's (UBER) membership in the prestigious Russell 1000 Index is commendable. Many other companies that made their public debut in 2019, including its competitor Lyft, have also been added to the index.
The iShares Russell 2000 ETF (NYSEArca: IWM), the largest ETF tracking smaller companies, and the large-cap iShares Russell 1000 ETF (NYSEArca: IWB), among other ETFs tracking those popular benchmarks, ...
Not only will the investors be able to start selling their shares on these dates, but so will employees of the newly minted IPO companies.
(Bloomberg) -- Stewart Butterfield loved the game, but not enough people agreed with him. He spent two years and raised roughly $11 million to build an online adventure game called Glitch that featured garrulous, blue-headed creatures and milk-drunk butterflies.Once people had a chance to play it and Butterfield could track the numbers, the verdict was clear: Glitch was a flop. “There was this night where I just lost faith,” Butterfield said in a podcast interview. He decided in 2012 that it was game over. Butterfield made plans to shut down the company and give the remaining money back to his investors.Andrew Braccia, a partner at venture capital firm Accel, wouldn’t accept the refund. He and other investors urged Butterfield to keep the remaining $5 million and try something else. That turned into Slack Technologies Inc., the maker of corporate chat software that went public Thursday. At the close of trading, Slack’s market value was $19 billion.Accel invested about $200 million in Slack over seven years, largely driven by Braccia’s unwavering faith in Butterfield. As of the stock debut, Accel held 24% of the company, the biggest VC stake in a newly public unicorn in recent history. Those shares are worth $4.6 billion today.Owning such a large chunk of a company is unusual in venture investing for a couple reasons. If a startup appears to be succeeding, founders and other investors compete fiercely for shares. And when things are uncertain, overexposing a fund to one company can be a foolish gamble. “They don’t all look like winners right away,” said Trae Vassallo, managing director of early-stage venture firm Defy.The startup failure rate is 67%, according to research firm CB Insights. Just 1% of those achieve a unicorn valuation of at least $1 billion. “You have to have a clear conviction when making a concentrated bet,” said Byron Deeter, a partner at Bessemer Venture Partners. “If you’re right, you’ll be disproportionately rewarded. But if it goes bad, there’s a real risk.”Slack is what happens when a risky bet pays off. The value of Accel’s stake is greater than that of any private financier of Lyft Inc., Snap Inc., Spotify Technology SA or Twitter Inc., each of which went public at higher market values.In an interview Thursday, Butterfield said Accel was eager to buy into every funding round for Slack—of which there were many—and offered to invest more than expected almost every time. The company had raised more than $1.2 billion in private capital, according to CB Insights data. “Our whole board, the VC members of the board, have worked incredibly hard,” Butterfield said. “I feel incredibly well supported.”In the windup to Slack’s listing, Accel converted about a quarter of its Slack holdings to common stock, allowing it to sell that portion of its shares. Such a transaction could return more than $1 billion for the VC firm, earning back the total sum of several funds. And that doesn’t account for two other Accel companies that have gone public since April, Crowdstrike Holdings Inc. and Pagerduty Inc.In 2012, when Butterfield was convinced he’d failed, Braccia was steadfast, said Bradley Horowitz, who put some of his own money in the game company. That’s probably because Braccia recalled what happened the last time Butterfield made a bad game. It morphed into a popular photo-sharing site called Flickr, which Yahoo! bought for around $25 million in 2005. Braccia, Butterfield and Horowitz all worked together at Yahoo.Horowitz, now a vice president of product at Google, said Braccia “was the one who said ‘keep going.’ He had the determination.” Horowitz joined Braccia in refusing to take his money back when Butterfield was ready to give up. “Stewart could have told me he was building a new coat hanger,” Horowitz said. “I would be all in.”Braccia declined to be interviewed, citing the regulatory quiet period. Bloomberg Beta, the venture capital arm of Bloomberg LP, is also an investor in Slack.In 2015, just as Slack was beginning to gain traction, Braccia explained why he was making such a big bet on the company. Butterfield has an uncanny ability to recover from failure and then rally people around his next idea, Braccia told a crowd at the time: “He’s resilient. He’s been knocked down multiple times, and he’s picked himself back up.”\--With assistance from Ellen Huet.To contact the author of this story: Lizette Chapman in San Francisco at email@example.comTo contact the editor responsible for this story: Mark Milian at firstname.lastname@example.org, Michael HythaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
There are no assurances that the reference price will reflect early trading in Slack stock, which will trade under the ticker symbol “WORK.”
(Bloomberg Opinion) -- Slack Technologies Inc. couldn’t have picked a better time to go public. Investors have lost their minds about software companies.Earlier this year, I wrote about how stock buyers were willing to pay handsomely to own shares of fast-growing companies that sell cloud software to businesses. As investors had grown antsy about the FAANGs — the elite technology superpowers such as Apple Inc. and Google parent company Alphabet Inc. — the software PUTIN stocks, as I semi-apologetically called them,(1)were ascendant. Since then, investors have warmly greeted new stock listings by even more business software firms including Zoom Video Communications Inc., Pagerduty Inc. and CrowdStrike Holdings Inc.I went back to my self-selected cohort of 17 business software firms that included Salesforce, Adobe, Atlassian and ServiceNow. The median stock multiple of my cohort, which I had to adjust slightly because of acquisitions, didn’t budge much since the February analysis.The median market value adjusted for cash and debt was about 10.3 times a blend of revenue estimated in the next year, compared with 9.8 times in February. The price-to-earnings multiple of the S&P 500 index has also increased since then.(5) What really stood out was the top-tier companies in my PUTIN index have grown even more bubbly.Look behind the velvet rope to find the 20x Club, the most popular hot spot in stock markets. More than half a dozen software firms now have enterprise values that are more than 20 times expected revenue in the next year, according to Bloomberg data.That is — to put it mildly — not normal. Relative to revenue, buying a share of pharmaceutical software firm Veeva Systems Inc., a member of the 20x Club, is four times the price of Alphabet, one of the dominant companies of this generation. Some of the members of the 20x Club are newly public, and it’s not unusual to see young companies with stock market values that are a bit out of whack. But 20x Club members also include Veeva, Atlassian Corp., Okta Inc., MongoDB and other companies that have been public for 18 months or more. As corporate-messaging service Slack plans to list its shares Thursday in a not-IPO,(2)it may join this elite crew. A valuation for Slack of $17 billion or so would work out to an enterprise value to forward revenue in the ballpark of the 20x Club.There are understandable reasons these business software firms, which are relatively unknown by normal humans, have become darlings of the stock market and technology investing. Something real and seemingly permanent is changing in how companies large and small buy technology. Companies are desperate to modernize their technology so they don’t get left behind and can take advantage of growth opportunities, and that has made them open their wallets to buy new types of internet-friendly, easy-to-use software that promises to help make their marketing spending more efficient, catch cyberattacks before they cripple systems or enable seamless communications among far-flung employees.I’m not yet convinced that these young cloud software companies can ever grow as large as their investors believe, particularly if an economic downturn forces companies to rationalize their technology budgets. But software truly is eating the world, and that has accrued to the benefit of both titans such as Microsoft and relative newcomers like the members of the 20x Club.At the same time, investors are desperate for growth, and business software firms are delivering it in spades. They can also be relatively easy to understand — they sell software in exchange for cash — and businesses have proved to be relatively reliable consumers, unlike people and their tendency to flit from one hot internet thing to the next. And now that superstar tech companies have run into regulatory problems, been hit with tariffs or otherwise have more question marks than before, a bet on a company selling software that an antitrust lawyer would never notice suddenly looks like a good idea. The question is what that promise costs. As stock buyers pay more relative to a company’s revenue, any wobble in growth can result in a crash, and investors’ room for error narrows when stock prices are already high relative to a company’s financial prospects. High stock valuations may also deter some needed consolidation in business software. It has become fashionable not to care about valuation, but there can be a high price to bubbles in share prices. Of course, I could have called a bubble in business software stocks at multiple points in the last decade and it would have been accurate in the moment yet completely wrong. An index of mostly business software companies, the BVP Nasdaq Emerging Cloud Index, has more than quintupled since 2013, compared with a 74% gain for the S&P 500 over the same period. It’s true that 10 years into an unprecedented bull market in stocks, unusual valuations are par for the course. Maybe the bubble for business software firms will never end, or stock prices of these highflying software firms will deflate slowly rather than blow up. Maybe. Or there may be a high price to pay for software companies in an unprecedented stratosphere. (1) No, I am not sorry at all. I will say, however, that the "U" in PUTINs, Ultimate Software Group Inc., was sold in May to an investor group. My acronym is broken.(2) Yes, these software companies tend to be valued as a multiple of revenue rather than profits. In many cases they don't have profits.(3) Bloomberg Beta, the venture capital arm of Bloomberg Opinion parent Bloomberg LP, is an investor in Slack.To contact the author of this story: Shira Ovide at email@example.comTo contact the editor responsible for this story: Daniel Niemi at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Shira Ovide is a Bloomberg Opinion columnist covering technology. She previously was a reporter for the Wall Street Journal.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
The rebalancing of the family of Russell indexes at the end of June will see a number of recent IPOs added, providing a temporary boost to those companies' shares.
PagerDuty has been fond of calling its software the "central nervous system" for a company's digital operations. Its core cloud software platform, which is sold via four subscription plans, is used by teams of on-call IT workers in fields such as IT operations, security operations, DevOps and customer support to be notified about and address various types of unexpected incidents and events. Following PagerDuty's earnings report, I had a chance to talk with Jenn Tejada, who has been the company's CEO for the last three years.