Facebook (Ticker: FB) is down ~47% since its IPO in May. Now, it is not the most botched IPO ever unfortunately as the infamous record belongs to BATS Exchange (Ticker: BATS) which operates an alternate stock exchange to NYSE and NASDAQ. (Read the Business Insider story here: 8 Unforgettable IPO Disasters)
Also, FB is not the worst performing IPO either. Groupon (Ticker: GRPN) and Zynga (Ticker: ZNGA, proudly led by Mark Pincus), are down 77% and 74% respectively since their IPO. In comparison, FB has done ok, it could be worst but a rapid strategy shift by FB including the emphasis on mobile and a decision to allow e-commerce transactions (Facebook Gifts) on Facebook have provided some kind of a floor under its stock. Here is a chart comparing the three (not-so) darlings of the Web 2.0.
Anyhow, below is a table of the best IPOs for this year. Guidewire (Ticker: GWRE) and Demandware (Ticker: DWRE) are the two cloud technology companies in the list that have done very well returning 137% and 108% till date.
Palo Alto Network (Ticker: PANW) is up 16% since IPO with returns of 48% over its IPO price of $42. Splunk (Ticker: SPLK) is down about 10% since IPO but still giving returns of 90% over its IPO price of $17. Both these companies didn't make the cut in the table above.
Here is a list of the worst performing IPOs till date. If one were to change the time period from YTD to 12-months, Zynga shows up in the list, no surprise there. Social gaming is a fast changing environment and ZNGA faces crisis in confidence with so many departures.
Take a closer look, FB is barely staying away from this infamous list. On a similar note, LinkedIn (Ticker: LNKD) is up approximately 80% till date. What a contrasting tale of the two social network companies!
So far in 2012, IPOs have resulted in 20% returns which is better than the -11% returns IPO market yielded in 2011. Since there are about 2.5 months more to go before the curtains drop on 2012, the 2012 IPO return might beat the 25% returns the year 2010 produced.
.png)
One very encouraging signs for the IPO investors this year has been the 13% average first day pop in IPOs that is line with what IPO market observed before the great recession (~13%). And to all the naysayers out there who claim that tech-stocks are in a bubble, take a look at the average opening day pop in 1999 (72%) and 2000 (56%) and compare it to 2012, you will hold your peace for few more years at least!
Workday (Ticker: WDAY) is on the deck for this week. Do you due-diligence before investing.
Happy IPO Investing!
Jitender
Source: Renaissance Capital, Greenwich, CT (www.renaissancecapital.com).
Also, FB is not the worst performing IPO either. Groupon (Ticker: GRPN) and Zynga (Ticker: ZNGA, proudly led by Mark Pincus), are down 77% and 74% respectively since their IPO. In comparison, FB has done ok, it could be worst but a rapid strategy shift by FB including the emphasis on mobile and a decision to allow e-commerce transactions (Facebook Gifts) on Facebook have provided some kind of a floor under its stock. Here is a chart comparing the three (not-so) darlings of the Web 2.0.
Anyhow, below is a table of the best IPOs for this year. Guidewire (Ticker: GWRE) and Demandware (Ticker: DWRE) are the two cloud technology companies in the list that have done very well returning 137% and 108% till date.
IPO Top Performers (YTD)
| Company | Offer Date | Under | Industry | Deal Size (mm) | Offer Price | First Day Close | Closing Price | First Day Return | Total Return | |
|---|---|---|---|---|---|---|---|---|---|---|
| Supernus Pharmac | 4/30/12 | Citi | Health Care | $50 | $5.00 | $5.37 | $12.77 | 7.4 % | 155.4 % | |
| Nationstar Mortg | 3/7/12 | Merrill | Financial | $233 | $14.00 | $14.20 | $33.29 | 1.4 % | 137.8 % | |
| Guidewire Softwa | 1/24/12 | JPM | Technology | $115 | $13.00 | $17.12 | $30.84 | 31.7 % | 137.2 % | |
| Annies | 3/27/12 | CS | Consumer | $95 | $19.00 | $35.92 | $44.87 | 89.1 % | 136.2 % | |
| Demandware | 3/14/12 | GS | Technology | $88 | $16.00 | $23.59 | $33.31 | 47.4 % | 108.2 % |
Palo Alto Network (Ticker: PANW) is up 16% since IPO with returns of 48% over its IPO price of $42. Splunk (Ticker: SPLK) is down about 10% since IPO but still giving returns of 90% over its IPO price of $17. Both these companies didn't make the cut in the table above.
Here is a list of the worst performing IPOs till date. If one were to change the time period from YTD to 12-months, Zynga shows up in the list, no surprise there. Social gaming is a fast changing environment and ZNGA faces crisis in confidence with so many departures.
IPO Worst Performers (YTD)
| Company | Offer Date | Under | Industry | Deal Size (mm) | Offer Price | First Day Close | Closing Price | First Day Return | Total Return | |
|---|---|---|---|---|---|---|---|---|---|---|
| Envivio | 4/24/12 | GS | Technology | $70 | $9.00 | $8.49 | $2.15 | -5.7 % | -76.1 % | |
| Audience | 5/9/12 | JPM | Technology | $90 | $17.00 | $19.10 | $5.65 | 12.4 % | -66.8 % | |
| CafePress | 3/28/12 | JPM | Technology | $86 | $19.00 | $19.03 | $8.07 | 0.2 % | -57.5 % | |
| Ceres | 2/21/12 | GS | Materials | $65 | $13.00 | $14.80 | $5.77 | 13.8 % | -55.6 % | |
| Renewable | 1/18/12 | UBS | Energy | $72 | $10.00 | $10.10 | $5.16 | 1.0 % | -48.4 % |
Take a closer look, FB is barely staying away from this infamous list. On a similar note, LinkedIn (Ticker: LNKD) is up approximately 80% till date. What a contrasting tale of the two social network companies!
So far in 2012, IPOs have resulted in 20% returns which is better than the -11% returns IPO market yielded in 2011. Since there are about 2.5 months more to go before the curtains drop on 2012, the 2012 IPO return might beat the 25% returns the year 2010 produced.
One very encouraging signs for the IPO investors this year has been the 13% average first day pop in IPOs that is line with what IPO market observed before the great recession (~13%). And to all the naysayers out there who claim that tech-stocks are in a bubble, take a look at the average opening day pop in 1999 (72%) and 2000 (56%) and compare it to 2012, you will hold your peace for few more years at least!
Workday (Ticker: WDAY) is on the deck for this week. Do you due-diligence before investing.
Happy IPO Investing!
Jitender
Source: Renaissance Capital, Greenwich, CT (www.renaissancecapital.com).
Would be interesting to see these figures as weighted numbers too (i.e. adjusting for the size of the IPO). BATS might have been worse, but it was just $100m... FB might still take the crown?
ReplyDeleteYes, you are right, this analysis should be redone to weight the IPO performance by the size of the IPO. Thanks for your comment.
ReplyDelete