The IPO Buzz: Robinhood Lays An Egg

Robinhood Markets (HOOD) started trading today at $38 – flat with its IPO price at the low end of its $38-to-$42 range. The online broker’s debut on NASDAQ was a much more muted performance than some on the Street had expected. The stock briefly spiked – hitting an intraday high at $40.25 – and then quickly slid – breaking issue price and hitting an intraday low of $33.35 before bouncing back to around $36 – down 5 percent from its IPO price. Robinhood closed on Thursday at $34.82, down 8.37 percent from its IPO price and a broken deal on its first day of trading.

“We’re in it for the long haul. We’re not concerned about the moment to moment,” co-founder and CEO Vlad Tenev told Bloomberg TV’s Emily Chang in a live interview shortly before midday.

Tenev was sanguine when Chang asked him about Robinhood’s regulatory issues, including the company’s disclosure this week that FINRA is investigating the company due to Tenev and co-founder Baiju Bhatt not being registered with FINRA.

“I’m the CEO of the holding company,” Tenev said, noting that people working for Robinhood Financial and Robinhood Securities are licensed.

Robinhood’s IPO – one of the most highly anticipated of the year – raised about $2.09 billion. The company sold 55 million shares, the full amount in its prospectus, at $38 – with Robinhood customers getting about 20 percent of the stock.

Duolingo and Riskified Jump

In contrast to Robinhood’s opening-day performance, the IPOs of Duolingo (DUOL) and Riskified (RSKD) delivered strong gains in their debuts as publicly traded companies. Duolingo and Riskified were viewed as “the deals of the week” by IPO professionals.

Duolingo, the popular mobile app for learning languages, opened Wednesday at $141.40 – up 38.6 percent from its IPO price at $102, which was above its increased price range of $95 to $100. The IPO, which was a sliver deal with just 5.1 million shares, closed its first day of trading at $139.01 – up 36.3 percent from its IPO price. Duolingo traded at around $138.28 today (Thursday, July 29, 2021) and closed at $134.44.

Riskified, the Israeli fraud-management platform for online merchants, began trading today at $27 – up 28.6 percent from its IPO price of $21, which was above its $18-to-$20 range. The stock traded at around $26.15 in the early afternoon and closed today at $26, up 23.81 percent from its IPO price.

Hello, Moonshot

Icosavax (ICVX), a biotech developing vaccines targeting pneumonia in elderly people, scored a moonshot today. The IPO was priced at $15 – and the stock opened at $29. Icosavax traded  in the early afternoon at $39.14 – up 160.9 percent from its IPO price. The stock closed at $34.97, up 133.13 percent from its IPO price. The Icosavax IPO was upsized to 12.1 million shares,  up from 10 million in the prospectus, and the $15 pricing was at the mid-point of its $14-to-$16 range.

Tonight’s IPO pricing roster includes 11 deals – eight biotech deals (seven IPOs and one uplift from the AIM) along with Dole plc (DOLE proposed) and two blank-check IPOs, also known as special-purpose acquisition company (SPAC) IPOs. Rox Financial (ROXA proposed), a novel REIT with just one property, an Amazon leased warehouse in the San Francisco Bay area, rescheduled its IPO from tonight to next week’s IPO Calendar .

The pricings tonight will wrap up one of the busiest IPO weeks in more than 20 years – with about 30 deals and estimated volume of more than $9 billion in the offing.

First Week of August

Next week’s IPO Calendar has six IPOs so far – a pace that some on the Street will welcome after the red-hot marathon of mid- to late July.

Stay tuned.

(For more information, please see the  IPO Calendar. You can click the hyperlinks on company names on the IPO Calendar and those links will take you to the IPO profiles on IPOScoop.com.)

(Never trade on proposed symbols. You might wind up owning something on the OTC Bulletin Board.)

Disclosure: Nobody on the IPOScoop.com staff has a position in any stocks mentioned above, nor do they trade or invest in IPOs. The IPOScoop.com staff does not issue advice, recommendations or opinions.

Disclaimer: A SCOOP Rating (Wall Street Consensus of Opening-day Premiums), is a general consensus taken, at press time, from Wall Street and investment professionals concerning how well an IPO might perform when it starts trading. The SCOOP Rating does not reflect the opinions of anyone associated with IPOScoop.com. The SCOOP ratings should not be taken as investment advice. The rating merely reflects the opinion of the professionals at the time of publication and is subject to last-minute changes due to market conditions, changes in a specific offering and other factors, such as changes in the proposed offering terms and the shifting of investor interest in the IPO. The information offered is taken from sources we believe to be reliable, but we cannot guarantee the accuracy.