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Car seller Vroom set to go public under 'VRM,' Tiffany sales soar in Mainland China

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Yahoo Finance's Emily McCormick joins The First Trade to discuss Vroom's public offering. She also breaks down Tiffany's recent rise in sales in Mainland China.

Video Transcript

ALEXIS CHRISTOFOROUS: In another sign that this market is really coming back to life, the IPO market is showing a lot of momentum. It looks like we're getting new S-1 filings just about every day. Emily McCormick has been keeping an eye on this. And Emily, today the spotlight belongs to Vroom, the online automotive company. I understand they priced their IPO at the high end of the range last night. What else can you tell us?

EMILY MCCORMICK: Absolutely, Alexis. So we are seeing a renewed appetite for newly public companies recently. And Vroom is no exception. So we had that online car retailer pricing its IPO yesterday, that was actually two days earlier than initially planned, given this recent rush to hit the public markets. So Vroom was an upsized IPO, with the company selling more than 1 million shares for $22 each, and raising a total of $468 million. This was upsized, as I mentioned, since Vroom had earlier marketed 18.75 million shares for between $18 and $20 a piece.

Now following this offering, the company is valued around $2 and 1/2 billion. Taking a look at the financials of this company, Vroom isn't profitable, but growing on top line, posted a net loss of $41 million on sales of $376 million for the three months ended March 31. That was wider than the net loss of $27 million in the same period last year, although sales were also up 60%.

Vroom mentioned in its prospectus that it's expecting the COVID-19 pandemic will encourage customers to bypass, especially using online platforms to maintain social distancing. Those shares are expected to begin trading today on the NASDAQ under the ticker symbol VRM.

The last thing I want to point out is that we have seen a major uptick in initial public offerings and other listings over the past couple of weeks. Last week was the busiest so far this year for new listings, with eight IPOs and two listings via special purpose acquisition companies taking place. We have another eight IPOs and one listing of the special purpose acquisition company slated for this week, and those IPOs do include Vroom for today. Alexis?

- Emily, one more for you-- one thing that caught my attention this morning, Tiffany out with earnings. And I think, underscoring some of this froth we're seeing in the market, they noted sales in China were up big.

EMILY MCCORMICK: Absolutely. So that was definitely a highlight from this earnings result. And we do have Tiffany shares up 2%, even though the company swung to a first quarter loss and posted a 45% decline on the top line for its fiscal first quarter. Taking a look at those sales in China specifically, though, massive rebound. Those were up 30% over last year in April and up 90% over last year in May. So a big recovery that we saw after sales drops of 85% in February and 15% in March for mainland China.

So Tiffany did say it's focusing on that geography in its recovery strategy. It also reaffirmed that it's going to be moving ahead with its deal to be acquired by luxury company LVMH, and that, of course, coming as reassurance for investors, who had been concerned over some recent reports that there might be some jeopardy surrounding the deal because of disruptions related to the pandemic. So again, we are seeing Tiffany pop [INAUDIBLE] those year to date losses, given some of the [INAUDIBLE].

- All right, Emily. Thanks so much.