Upcoming June IPO’s
So far, 2019 has been a banner year for IPOs, and it’s been an exciting ride. Some companies, like Beyond Meat have seen their share prices skyrocket, while other tech darlings haven’t fared so well. Here’s a look at some of this month’s IPO offerings, including the much-anticipated public introduction of Slack.
CrowdStrike
This cybersecurity company could be valued at over $4.5 billion dollars , putting it among the ranks of the so-called unicorn IPOs—companies valued at over $1 billion before going public. CrowdStrike’s IPO comes on the heels of an already busy tech IPO season, which has seen tech giants like Pinterest, Uber, Lyft and Zoom already go public.
The company was founded in 2011 and offers cloud-based services to help protect its customers against data breaches.
What to Know About Its IPO:
Proposed Ticker Symbol: CRWD
Expected IPO Date: June 12, 2019
Potential IPO Price: $19–$23
Shares Offered: 18 million
Fiverr
Participants in the gig economy may already be familiar with Fiverr , which connects freelancers with companies that are looking to hire them. Users browse the company’s website for services, placing orders for the gigs that match their needs.
Over the last year, gig economy IPOs haven’t had the smoothest ride. Uber, which went public in May , had a rocky start to its IPO, though it is now trading slightly above its IPO price.
Rideshare rival Lyft hasn’t been as lucky. so far. The company’s share price plunged upon its initial public offering, and shares are still trading well below the IPO price.
Fiverr competitor Upwork, which went public in October of 2018 and offers software to connect freelancers and companies looking to hire them, gained traction over the winter, but is now once again trading near it’s IPO price.
The effect these rocky starts will have on Fiverr, if any, when it goes public next week remains to be seen
What to Know About Its IPO:
Proposed Ticker Symbol: FVRR
Expected IPO Date: June 13, 2019
Potential IPO Price: $18–$20
Shares Offered: 5.26 million
Chewy
For the animal lover, Chewy, Inc. is an online retailer that specializes in a wide range of pet products. The company launched in 2011 and operates as an independent subsidiary of PetSmart Inc.
Its stated mission is to become the most trusted and convenient online destination for pet owners, vets and service providers. The online store carries more than 1,600 brands, and the company’s 10,000 employees operate from 13 locations across the U.S. Pet owners can sign up for the Chewy’s autoship program which automatically sends and bills for products owners use regularly.
The company is going public in an industry that may be ripe for growth. Pet ownership in the U.S. is on the rise, and in 2018, Americans spent more than $72 billion on pet products.
What to Know About Its IPO:
Proposed Ticker Symbol: CHWY
Expected IPO Date: June 14, 2019
Potential IPO Price: $17–$19
Shares Offered: 41.6 million
Mohawk Group Holdings, Inc.
Mohawk is a technology-enabled consumer products company that uses data and artificial intelligence to efficiently deliver the products their customers need. The company uses big data and machine learning to identify market opportunities and also market and sell products.
What to Know About Its IPO:
Proposed Ticker Symbol: MWK
Expected IPO Date: Week of June 10, 2019
IPO Price: $14–$16
Shares Offered: 3.33 million
Slack
Among the most anticipated companies going public this year is Slack, a cloud-based services company that offers team collaboration tools such as interoffice chat. Instead of offering its shares through an initial public offering, the company is planning a direct filing for June 20 .
During a traditional IPO, an underwriter—typically an investment bank—helps facilitate the sale of shares and drums up interest among investors. A direct public offering, or DPO, skips this step. Shares are offered directly to the public without going through a middleman first.
Forgoing the help of underwriters helps companies avoid expensive underwriting fees and can eliminate the lock-up period required during most IPOs. As a result, raising capital can be cheaper for the company going public, and company insiders can sell their shares.
Last year, Spotify made a similar move, offering shares of the music streaming service directly to the public, one of the only other large companies to have done so.
What to Know Before You Consider Investing
If you’re curious about investing in IPOs, there are a few things worth keeping in mind. On the day of a company’s IPO, its stock hits the secondary market and the public can begin trading immediately.
Yet, no one really knows what will happen in the hours and days after a stock goes public—prices could go up, or they could drop significantly. To make matters more complicated, private companies don’t have to disclose much information about their inner workings, so investors don’t have much information to go on about a company’s fundamentals before it goes public. As a result, investing in an IPO can be a more speculative endeavor than investing in a company that’s already established on the market.
It often makes sense to wait a few months to let any potential volatility die down and get a clearer picture of how the share price is moving. Sometimes it’s best to wait until after the company’s lock-up period has ended before drawing any conclusions.
Company insiders are forbidden from selling their shares during the lock-up period. But once it’s over, it’s a free-for-all. Insiders can sell their shares, and the new shares flooding the market can potentially cause prices to dip. In the case of a DPO, like the one planned by Slack, there may be no lock-up period to worry about.
Investing in June’s IPOs
Investors looking to buy IPO stocks often do so in brokerage accounts. When buying and selling, orders are placed with stockbrokers who then execute the trade.
Those interested in handpicking stocks themselves using technology, often use app-based trading platforms like a SoFi active investing account. IPO stock can also be accessed through index funds, such as exchange-traded funds.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SoFi Invest®
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC .
Investing in an Initial Public Offering (IPO) involves substantial risk, including the risk of loss. Further, there are a variety of risk factors to consider when investing in an IPO, including but not limited to, unproven management, significant debt, and lack of operating history. For a comprehensive discussion of these risks please refer to SoFi Securities’ IPO Risk Disclosure Statement. IPOs offered through SoFi Securities are not a recommendation and investors should carefully read the offering prospectus to determine whether an offering is consistent with their investment objectives, risk tolerance, and financial situation.
New offerings generally have high demand and there are a limited number of shares available for distribution to participants. Many customers may not be allocated shares and share allocations may be significantly smaller than the shares requested in the customer’s initial offer (Indication of Interest). For SoFi’s allocation procedures please refer to IPO Allocation Procedures.
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