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Home / Business / It has nothing to say that Peloton shares fell on the first day: Morning Brief

It has nothing to say that Peloton shares fell on the first day: Morning Brief



<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Friday, September 27 , 2019 "data-reactid =" 15 "> Friday 27. September 2019

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Get the morning letter sent direct to your inbox every Monday to Friday at 6:30 pm ET. Subscribe "data-reactid =" 16 "> Get the morning letter sent directly to your inbox every Monday to Friday by 06 : 30 in ET. Subscribe

Why Peloton's listing was a great success

Peloton went public on Thursday.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Shares of the interactive training platform operator & nbsp; priced at $ 29 on Wednesday & nbsp; and closed Thursday's trading session at $ 25.76, good for an 11.2% fall on its first trading day. "data-reactid =" 19 "> Shares of the interactive training platform operator priced at $ 29 on Wednesday, ending Thursday's trading session at $ 25.76, good for a 11.2% drop on the first trading day.

<p class = "canvas -at canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "This stock drop on the first trading day could Bloomberg notes, for example, that it was & nbsp; the third worst public debut & nbsp; in the last decade. "data-reactid =" 20 "> This fall in the stock of The first day of trading could be a disappointment. For example, Bloomberg notes that it was the third worst public debut of the last decade.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "This price action may indicate that investors are not is excited about Peloton's prospects and that the & nbsp; fight with IPOs for consumer technology & nbsp; will continue this year. Some may also ask if this means the IPO window is closing. We Company spread to other offers? And if the entire market for a successful IPO sees stocks emerge on the first day, is this a failure, isn't it? "Data-reactid =" 21 "> This price action may indicate that investors are not excited about the prospects of Peloton and that this year's battle with IPs for consumer technology will continue. Some may also ask if this means closing the IPO window. Have the matches at The We Company spread to other deals? And if the entire market for a successful IPO sees stocks emerge on the first day, this is surely a failure, right?

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) –sm Mt (0.8em) – sm" type = "text" content = "Well, as far as it renowned VC investor & nbsp; Bill Gurley & nbsp; sees it, the first-day IPO pop is the most misunderstood and financially nonsensical event that a management – and investors and media – team can root for. "data -reactid = "22"> Well, as far as the famous VC investor Bill Gurley sees it, the first day of IPO pop is the most misunderstood and financially nonsensical event as a management – and investors and media – the team could mess up.

<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Apropos with & nbsp; Patrick O & # 39; Shaugnessy & nbsp; at & nbsp; Invest As the best podcast this week Gurley took the task of the idea that "successful" IPOs are the companies where the company's shares trade sharply higher the first trading day. "data-reactid =" 23 "> Speaking to Patrick O & # 39; Shaugnessy on Invest As the best podcast this week, Gurley took on the task of" successful "IPOs being the ones of a corporation Shares trade significantly higher on the first trading day.

"Thinking that a pop is a marketing event is about the most short-term informed decision a manager or CEO / CFO could think," Gurley said. "Because it happens and it's over. And then the rest of the company's life is based on how the company manages it. And the notion that I will gain some lasting benefit by paying $ 500 million for this long-term marketing capability thinking . "

<p class =" canvas atomic canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Gurley cites an analogy about home buying he heard from & nbsp; Henry Blodget – imagine selling your house and then hear your broker sell the house for 80% more the day after. Imagine celebrating it. This is what happens when the first day IPO pops are being cheered. It's a celebration that doesn't make any financial sense. "data-reactid =" 25 "> Gurley cites an analogy of home buying he heard from Henry Blodget – imagine selling your house, and Then hear your broker sell the house for 80% more the day after. Imagine celebrating it. This is what happens when first-day IPO pops are cheered. It is a celebration that makes no financial sense.

Companies that see stocks popping up on the first day of trading leave money on the table. Money that could have been used to invest in the business. And the founders, employees and early investors of a stock-selling company also lose money – potentially hundreds of millions of dollars – if the stock goes wrong on the first trading day. The only stakeholders who are excited about a first-day IPO pop are the investors who were lucky enough to receive an award the day before the IPO and then turned these stocks and bankers who will now be able to charge a future secondary offer of shares.

<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "To take a real world example from this year sold all who sold Beyond Meat ( BYND ) on the stock exchange for $ 25; when the market closed on Beyond & # 39; s first trading day, these shares were worth $ 65.75 [19459008SoforexampletheBeyondMeatleadersoldmillionverdiavBeyondMeat-aksjentilbørsnoteringavmerenn16millionerdollaripotensiellegevinster"datareactid="27">ForåtaetekteverdenseksempelfraiårsolgteallesomsolgteBeyondMeat(BYND)aksjertilbørsnoteringenaksjertil$25;damarkedetstengtepåBeyondsførstehandelsdagvardisseaksjeneverdt$6575SåenBeyondMeat-lederforeksempelsomsolgte$1millionverdiavBeyondMeat-aksjentilbørsnoteringentaptemerenn$16millioneripotensiellegevinster

<p class = "canvas-atom canvas-text Mb (1 .0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" But guess who benefited? The investors who got an IPO award from Beyond and turned it around on the first day and the bankers who got to participate in the & nbsp; Beyond & # 39; s Second Offer at the end of July . "Data-reactid =" 48 "> But guess who benefited from it? The investors who got an Beyond IPO award and turned it on first day, and the bankers who took part in Beyond's secondary offer in late July.

In other words, the winner of Beyond Meat & # 39; s IPO was not Beyond Meat.

19659016] Now certainly the bankers who run IPO processes nothing You can't let well-paid, well-connected financiers market your company and connect with investors for free, and as with many things in the financial markets, the psychology of events can play as much as the economy of an event. An IPO that drops on its first day of trading is believed to indicate that the company's outlook is poor, the financial benefit of a company that prices its IPO higher than it is open for trading may be ignored by investors.

<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Gurley's solution for companies is to favor directly flotations. In a direct listing – as we have seen from Spotify ( SPOT ) and Slack ( WORK ) recently – companies do not lean on a team of bankers to drum up support for shares to a certain price. "data-reactid =" 55 "> Gurley's solution for companies is to favor direct quotes. In a direct listing – as we have seen from Spotify (SPOT) and Slack (WORK) recently – companies do not lean on a team of bankers to to drum up support for equities at a certain price.

Instead, the company says it will list equities on a particular stock exchange on a specific date and then equities begin trading – the recent public company does not raise money or issue new shares Of course, the problem with direct quotes is that they make bankers a lot less money.

But the purpose of a stock exchange listing is not to enrich bankers or to increase the share. The purpose of a stock exchange listing is to raise money and offer liquidity to early shareholders who had The price the market sets for shares after they start trading should not – or at least not, and certainly does not need – role for the company.

<p class = "canvas atom ca nvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Because eventually a good company will be respected by the market in the long term. As Gurley reminds listeners, Facebook ( FB ), Amazon ( AMZN ) and Alphabet ( GOOGL ) "broke the problem" and traded below their IPO price. And I think we would all agree these companies have done well by their shareholders. "data-reactid =" 58 "> Finally, a good company will be respected by the market in the long term. As Gurley reminds listeners," Facebook (FB), Amazon (AMZN) and Alphabet (GOOGL) "broke the problem" and acted during the IPO price. And I think we all agree that these companies have done well by their shareholders.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " By Myles Abroad reporter and anchor for Final Round Follow him @MylesUdland "data-reactid =" 59 "> By Myles Abroad reporter and anchor for Final Round . Follow him @MylesUdland

What to look at today

<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt ( 0.8em) – sm "type =" text "content =" Economy "data-reactid =" 61 "> Economy

  • 8:30 am ET: Personal income, August (0.4% expected, 0.1% in July); Personal expenses, August (0.3% expected, 0.6% in July)

  • 08:30 ET: Durable goods orders, preliminary August (-1.2% expected, 2.0% in July); Duration excluding transport, due August (0.3% expected, -0.4% in July);

  • 10 am ET: University of Michigan Sentiment, September Final (92.1 expected, 92.0 before)

<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" From Yahoo Finance "data-reactid =" 66 "> From Yahoo Finance

  • Season 4 of the popular NBC drama "This is Us" premiered on Tuesday. Today at 5pm ET Yahoo Finance will surprise payout to My Three Cents where The Final Round co-anchors Jen Rogers interviews "This is Us" star Chrissy Metz who talks honestly about growing up poor and about how she keeps up keep an eye on the economy to ensure that she never lives in poverty again.

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ZHOUSHAN, CHINA – SEPTEMBER 01: Aerial view of a container ship from Cosco France using tugs in the port of Ningbo-Zhoushan September 1, 2019 in Zhoushan, Zhejiang Province China. The container ship Cosco France, coming from Singapore, will unload 8,015 containers with twenty feet equivalent unit (TEU) in Ningbo-Zhoushan port. (Photo by Yao Feng / VCG via Getty Images)

<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Global oil ship rates hover when US supertanker sanctions rattle crude oil trade [Reuters]" data-reactid = "100"> Global oil shipping rates hover as US supertanker sanctions rattle crude trade [Reuters]

< p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Pound plunges after Bank of England policy maker signals interest rate cut [Yahoo Finance UK] "data-reactid =" 101 "> Pound plunges after Bank of England politician signals interest rate cut [Yahoo Finance UK]

<p class =" canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Endeavor leaves market listing pushback & nbsp; [Reuters] "data-reactid =" 102 "> Endeavor leave r IPO mid market pushback [Reuters]

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "[19659055] DoorDash hack leaks data from 4.9 million customers, restaurants [Reuters] "data-reactid =" 103 "> DoorDash hack leaks data from 4.9 million customers, restaurants [Reuters]

YAHOO FINANCIAL HIGHLIGHTS

<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Markets would soar, not crash if Trump was impeached "data-reactid =" 105 "> Markets would soar, not crash if Trump was impeached

<p class =" canvas-atom canvas-text Mb (1.0em ) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" JPMorgan is bullish on this & # 39; universally hated and cheap sector & # 39; "data reactid = "106"> JPMorgan is bullish on this & # 39; universally hated and cheap sector & # 39;

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8 em) – sm" type = "text" content = " Marijuana Banking Act Can Create New Opportunities for Main St. Investors " data-reactid = "107"> Marijuana Banking Act Can Create New Opportunity for Main St. Investors

<p class = " canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Follow Yahoo Finance on Twitter Facebook [19659004] Instagram Flipboard SmartNews LinkedIn YouTube [19659004] and reddit . "data-reactid =" 108 "> Follow Yahoo Finance on Twitter Facebook [19659005] Instagram Flipboard ] SmartNews [19659005] LinkedIn YouTube [19659005] and reddit .


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