In Focus: The IPO Bargains of 2021
Every year, at the beginning of the year I put together a list of private companies that Wall Street is patiently waiting on to go public. Above is a list of companies we expected to go public in 2021.
Out of the 12 companies on the list, only five have not gone public yet, Stripe, InstaCart, Nextdoor, Ant Financial, and ThoughtSpot. Of the seven that have gone public, it's been a rocky start to life as a public company. The CEOs of these public companies have learned that the people who applauded you for building a billion dollar private enterprise, are the same people that criticize you now for your stagnant stock price.
It's quite funny actually, and I can laugh because I'm not one of these CEOs, but as private companies these CEOs are told they're doing every right, but when they're companies become public, and the stock price isn't moving north, they're asked when are they going to do something right to move the stock. Nuts!
It hasn't been all bad, the companies raised the money they needed to raise, the CEOs were crowned billionaires, and some investors made money.
The fintech Affirm (AFRM) went public in early January at $49 per share. The stock hit the open market at $90 a share and traded to over $135 per share three weeks after the IPO. Since then it's been in a slow decline and currently trades at $67.17. If you were lucky enough to get a piece of the IPO you're winning, if you bought in at $90 or above, you may feel like you got duped by the IPO hype. Affirm recently signed a deal with Apple which will allow Canadians to buy Apple products now and pay later with limited interest.
Petco (WOOF) also went public in early January at $18 per share. Petco also jumped out of the gates hot, hitting the public market at $26 a share and trading up to $31 per share on the same day. The stock would never see $31 again, since its opening day the stock has paced lower and now sits at $19.97
per share. From a review of the daily chart, the stock seems to find support around the $17 area. It traded down to $17 in early March and was quickly bought up, it traded back to $17 in July and again was bought up by investors. It appears to be headed back to $17. Will the buyers come out again?