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Tech IPOs saw some surprising hits and misses this year
There have been some hits and some misses among tech IPOs this year. Some have been surprising successes while others have been even more surprising flops. Here’s a quick roundup of some of the biggest tech IPOs this year and where they ended up at the end of the year. (We’re also including a few IPOs that occurred at the end of 2011 because their stocks performed so phenomenally badly in 2012.)
IPOs that have seen gains this year include…
After debuting at $15 a share back in March, Yelp shares surged 67% to $24.58 for a $1.2 billion valuation. Yelp’s shares have risen and fallen throughout the year, reaching a high of $28.89 in October. After its Q3 earnings report, which revealed a $2 million loss despite doing better than analysts expected, shares dropped to $16.77 a share—well below the $28 range at which it was trading in October, but still above its opening price in March. Yelp closed out Friday at $18.87, 25% above its IPO price.
This was a surprising one, since Kayak had postponed its IPO in light of Google’s $700 million ITA deal (in which Google bought the flight technology that powers sites like Kayak). After filing in November, Kayak let its paperwork expire while it waited to see which way the winds blew. Finally, in July, it priced its shares at $22-$25. On opening day, they debuted at $26 a piece and closed out at $33.18, up 27%. Kayak is actually one of the few tech stocks that’s actually doing better today than it did during its IPO. Kayak closed Friday at $39.40, an increase of 51.5% over its opening price.
Enterprise software never seemed so sexy. After surging a massive 72% to $48 a share (up from its initial price of $28) in its October IPO, Workday is another tech stock that has performed unusually well over the last few months. The stock has seen some highs and lows, but as of Friday evening, shares had closed at $53.40—a 90% increase over its opening price. Initially, the HR technology company had priced shares at $24-$26 for a potential $4.6 billion valuation. Today, Workday’s market cap is $8.89 billion. Bam!
But it hasn’t been all sunshine and daisies for tech companies this year. There have been a few noteworthy busts this year, including…
Obviously. With shares priced at $38 a piece, Facebook closed its first day at $38.37—literally pennies above its opening price. The following day, shares sank. And sank. Meanwhile, lawsuits were being bandied about as rumors spread that Facebook’s underwriters had actually lowered their forecasts for Facebook in the days prior to the IPO, but only told their top clients, leaving the smaller investors with false information. Today, Facebook shares were trading at $25.91, more than 30% below its initial price. But that’s up from a low of $17.70 in September, so there may be hope yet for Facebook.
After debuting in September at $22.10, a full 30% above its asking price of $17, Trulia had a fantastic first day, closing out at $24. And then shares wobbled and fell. They were up and down for a couple of months, and then they nosedived after Trulia’s third quarter earnings report, which revealed mixed results. Revenue was up 76% year-over-year, but the company took an even larger loss than the previous year ($1.7 million versus $1.5 million, respectively). At the same time, Trulia’s main competitor, Zillow, acquired mortgage software firm Mortech—which happens to be the technology that powers Trulia. Shares plummeted. As of Friday, they were trading at $16.06, down 27% from Trulia’s opening price.
I’m kind of cheating on this one, since Zynga technically went public in December 2011, but the stock has faceplanted so spectacularly that I had to include it. Zynga was one of the rare IPO cases where shares actually closed below their opening price. After opening at $10 a share, Zynga watched its stock rise a few pennies and then end at $9.50 a share—fifty cents below its asking price. There had been mixed opinions on how well Zynga would do as a public company, especially given the increasingly strained relationship between Zynga and Facebook. And it’s been all downhill since the IPO. Several top Zynga executives have abandoned ship and disappointing Q3 results prompted the company to lower its outlook. Today, Zynga is trading at $2.33 a share—a drop of more than 76% from its IPO price.
Another company that technically went public at the end of 2011, Groupon is my personal darling. I’m really rooting for the quirky, goofy manchild-of-a-company, which is why it’s made me kind of sad to see it grow up over the last year. Groupon made its public splash in November 2011, opening at $20 a share. Shares soared 30% to close the day at $26, raising $700 million for a market cap of $16.6 billion. Today, Groupon shares closed at $4.78 for a market cap of $3.13 billion. But I’m still holding a candle for Groupon. I have faith…
Image source: etf-corner.com
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