Seeking Alpha
  • Alibaba: Examining Valuation Above $66/Share
    BABA Today, 3:19 PM Apus Investments 9 Comments

    Summary

    • Alibaba's IPO is heavily oversubscribed with investors eagerly awaiting allocations and final pricing.
    • Several institutional investors have requested individual orders over $1 billion.
    • It is expected that pricing will be above the initial range of $60-$66/share and closer to $70 (or higher?).
    • We have back-solved the FCF growth rates required to justify various share prices ($65-$80/share). Investors can decide if the required growth rates seem reasonable.
    • Pricing and early trading will be driven by supply/demand, not intrinsic value.
  • Alibaba And 6 Health Care IPOs Planned For The Week Of September 15
    BABA, CIVI, TKAI Today, 2:29 PM Renaissance Capital IPO Research Comment!
  • Civitas Solutions Continues To Push For Growth In Upcoming IPO
    CIVI Today, 1:50 PM Don Dion Comment!

    Summary

    • CIVI, a provider of health and human services for individuals with disabilities and special needs, plans to raise $251.6 million in its upcoming IPO.
    • Though CIVI has posted losses in recent years, they have been minute compared to its revenue growth; the firm has massively expanded its scale over the same timeframe.
    • As the American population continues to age demographically, we expect that demand for CIVI's services will continue to rise.
    • The current turmoil surrounding healthcare payers in the United States may lead some investors to be wary.
    • We are cautiously optimistic on this IPO.
  • Tokai Pharmaceuticals IPO: Lack Of Product Diversity Should Leave Investors Cautious
    TKAI Today, 8:41 AM Don Dion Comment!

    Summary

    • TKAI, a clinical-stage biopharmaceutical company, engaged in the development of novel treatments for prostate cancer, plans to raise $75.6 million in its upcoming IPO.
    • Though TKAI remains a significant distance from commercializing lead product galeterone, the treatment has been promising in early trials.
    • However, the firm will face massive competition even if does receive approval for galeterone.
    • We are concerned about investing in TKAI, given its current lack of product diversity, and suggest investors be cautious.
  • US IPO Pricing Recap: ReWalk Runs - Year's 5th IPO To Top 100% In First-Day Trading
    RWLK, AFMD Yesterday, 2:58 PM Renaissance Capital IPO Research 3 Comments
  • Alibaba May Double Within 6 Months
    BABA Yesterday, 11:41 AM Mix Star 18 Comments

    Summary

    • Alibaba will IPO on Sept 18th.
    • It has dominated the Chinese retail industry and showed impressive growth.
    • The history of tech IPOs coupled with the anticipation of Alibaba could see it double within 6 months.
  • Alibaba IPO Analysis: Should You Buy The Stock? - Part 2
    BABA Yesterday, 7:13 AM Victor Liang 41 Comments

    Summary

    • Alibaba is seeking a valuation between $147.9 billion and $162.7 billion, which would make it the largest IPO in the U.S. to date.
    • Alibaba's growth potential in China remains strong even without expanding further into the international market.
    • There are several potential red flags and risks regarding the Alibaba Partnership, its variable interest entities, its Alipay arrangement and its accounting procedures.
    • I believe the company would be a bargain if the IPO is priced around $147.9 billion or lower based on the low-end offering price of $60 per share.
  • Zoe's Kitchen Serves Up Another Quarter Of Comfort Food
    ZOES Sat, Sep. 13, 10:34 AM Dallas Salazar 1 Comment

    Summary

    • ZOES hasn't had a single blowout quarter since going public but from what the market was promised at the IPO that's just fine.
    • ZOES CAPEX driven growth strategy is well funded, tested, has been proven, and has created a business as usual approach to growth for the next few quarters.
    • Knowing that most of the income statement losses were of the irrelevant variety and that operational cash flow increased I have a continued BUY recommendation for ZOES.
  • Will Alibaba Disrupt U.S. E-Commerce? The Man Who Should Know
    BABA Sat, Sep. 13, 1:09 AM Abe Garver 44 Comments

    Summary

    • To provide more color, I asked Don Davis who is Editor-in-Chief at e-commerce news and research firm Internet Retailer, which publishes the Top 500 Rankings.
    • Will Alibaba try to take on Amazon and eBay? The short answer from Don is no because he believes there is tougher competition in the U.S. than China.
    • This entire article quotes Mr. Davis who I know personally having been a featured M&A speaker two times at Internet Retailer's annual (world's largest) e-commerce conference.
  • Alibaba IPO Demand Strong; May Close Deal Early And Boost Price
    BABA Fri, Sep. 12, 3:19 PM ValueWalk 11 Comments
  • Alibaba IPO: Assessment Of Risks, Rewards
    BABA Fri, Sep. 12, 11:28 AM Don Dion 141 Comments

    Summary

    • The Alibaba IPO presents certain potential risks, including conflicts of interest, corporate structure and the Chinese political landscape, and size, to name a few.
    • Reuters has also recently suggested a lack of interest among retail investors that could imply fewer gains for the stock on its opening day.
    • Despite these, Alibaba's growth has been stunning, and its announced primary focus on China will likely allow it to prosper with few major competitors.
    • We are positive on both Alibaba and its major shareholder, Yahoo, in the weeks ahead.
  • ReWalk Robotics IPO - Exoskeletons For The Disabled
    RWLK Fri, Sep. 12, 11:26 AM IPO Candy 9 Comments

    Summary

    • ReWalk is an early leader in the emerging space of using exoskeletons to allow paralyzed people to walk again.
    • Revenues are nascent, but they are FDA approved and working to expand coverage and adoption. The company has good technology and a solid management team.
    • The proposed market capitalization of $144M (at the $12 price) looks attractive given the market opportunity and margin potential.
    • Their partnership with the much larger Japanese company Yaskawa helps limit the risk for investors if the company founders badly in terms of execution.
    • ReWalk is still very risky with large investments and quarterly losses still coming.
  • IPO Preview: ReWalk Robotics
    RWLK Fri, Sep. 12, 2:48 AM IPOdesktop 3 Comments

    Summary

    • Medical device company that is designing, developing and commercializing exoskeletons that allow wheelchair-bound individuals with mobility impairments or other medical conditions the ability to stand and walk once again.
    • As of August 1, 2014, RWLK had placed 62 ReWalk Rehabilitation and 19 ReWalk Personal systems, 88% of which were purchased by RWLK’s customers, and 12% of which were placed.
    • Cash burn rate is relatively high, indicated by a P/E ratio of -8.9 (lower absolute number is worse).
  • IPO Preview: Affimed Therapeutics
    AFMD Thu, Sep. 11, 5:10 PM IPOdesktop Comment!

    Summary

    • AFMD is a clinical-stage biopharmaceutical company focused on discovering and developing highly targeted cancer immunotherapies.
    • The cash burn rate relative to the market capitalization is relatively low: price-earnings ratio of -44.4 (lower absolute number is worse).
    • The Leukemia and Lymphoma Society, or LLS, has agreed to co-fund a phase 2a study.
  • ReWalk Robotics Ltd. IPO: Skeletons In The Closet
    RWLK Thu, Sep. 11, 3:25 PM Don Dion 19 Comments

    Summary

    • RWLK, a medical device firm engaged in the development and commercialization of exoskeletons to assist disabled individuals, plans to raise $50.3 million in its upcoming IPO.
    • Despite the small deal size, we are hearing the deal might need a lower price range to complete—and that the risk/reward is less than appealing.
    • RWLK's exoskeletons are the first to receive approval for medical use, however, have yet to receive support from third-party healthcare payers and face stiff competition.
    • Due to these factors and RWLK's significant losses, we do not recommend this IPO.
  • In A Quiet Week, Affimed Therapeutics IPO Could Garner Investor Interest
    AFMD Thu, Sep. 11, 3:17 PM Don Dion 5 Comments

    Summary

    • AFMD, a clinical-stage biopharmaceutical company, engaged in the development of cancer immunotherapies, plans to raise $75 million in its upcoming IPO, set to price Thursday night.
    • AFMD is still far from commercializing of its products; however, we suspect the firm's successful early trial results for AFM13 will attract investor interest.
    • While we are less inclined at this stage to recommend AFMD, the relatively quiet week for IPOs could bring more investor attention to AFMD.
    • Overall, we suggest investors wait to buy AFMD until its future is more certain.
  • Investors Could Learn A Thing Or Two From 2U's Lockup Expiration
    TWOU Thu, Sep. 11, 2:50 PM Don Dion 2 Comments

    Summary

    • September 23 will mark the expiration of the 180 day lockup period on TWOU, allowing ~30.3 million shares to become eligible for public trading.
    • Among these shareholders are numerous venture capital entities; stock price declines at the time of the lockup expiration are found to be the greatest for firms strong VC backing.
    • Though TWOU has performed relatively well on the market since its IPO, the stock has struggled in early September.
    • With a supply shock on the horizon, we envision a short-term trading opportunity for aggressive investors.
  • Adjusting Moelis & Company's Price Target Higher Is Easy To Do After The First Two Quarters
    MC Thu, Sep. 11, 9:23 AM Dallas Salazar Comment!

    Summary

    • MC just had the best Q2, the best 1H, and the best rolling 12 months in company history from a revenue growth standpoint.
    • MC should benefit into year-end from an improving M&A environment and from an expanded talent pool.
    • MC's quarter, when adjusted for one-time non-cash based comp that resulted from its IPO was actually quite impressive.
  • GoPro Powers Bloomberg IPO Index To 2014 Highs
    GPRO Thu, Sep. 11, 1:40 AM Bespoke Investment Group Comment!
  • Avoid Dave & Buster's IPO
    PLAY Wed, Sep. 10, 3:28 PM Mix Star 5 Comments

    Summary

    • Dave & Buster's has filed for a $100 million public offering.
    • The combo restaurant-arcade chain has outstanding debt and limited growth.
    • Dave & Buster's IPO may follow in the footsteps of Potbelly.
  • Analyst Concerns And Poor Stock Performance Could Open Doors To Strong Declines At King Digital Entertainment's Lockup Expiration
    KING Wed, Sep. 10, 2:48 PM Don Dion 26 Comments

    Summary

    • The expiration of KING's lockup period will allow pre-IPO shareholders to sell their shares in the company - approximately 292.7 million shares, ten times the amount of the IPO.
    • While the initial date for the lockup expiration was set for Sept. 21, major pre-IPO shareholders have agreed to set a new date, following the Q4/full-year earnings release.
    • Though casual games are soaring as an industry, the much-reported decline of Candy Crush Saga's popularity and disappointing bookings figures have left KING analysts concerned.
    • We envision significant declines at the time of the lockup expiration, as many could choose to sell their KING shares at the first possible opportunity.
  • Alibaba: Risk, Reward And The Best ETF
    YHOO, IPO, FPX Tue, Sep. 9, 6:22 PM Matthew Sauer, Esq. 8 Comments

    Summary

    • Alibaba is poised to benefit from the rebalancing of the Chinese economy.
    • The greatest risk comes from Jack Ma's history of investor unfriendly decisions.
    • YHOO remains the best option ahead of the IPO, while KWEB will offer the best ETF exposure post-IPO.
  • Alibaba Finally Gives Some Figures, Eyes Record Books
    BABA Tue, Sep. 9, 3:04 AM Doug Young 16 Comments
  • Alibaba's Coming Out Party: Valued Right, But Is It Priced Right?
    BABA Mon, Sep. 8, 6:49 PM Aswath Damodaran 20 Comments
  • Short-Term Declines In Sight For Nord Anglia Education
    NORD Mon, Sep. 8, 5:03 PM Don Dion Comment!

    Summary

    • NORD's share price may take a hit with the conclusion of the lockup period on September 21.
    • At this time, ~75.9 million shares will become available, held by majority shareholder Premier Education Holdings Ltd., likely depressing NORD’s share price - at least temporarily.
    • While long-term potential exists for NORD, we see a short trading opportunity around the lockup expiration.
    • Abnormal negative returns (-5.5%) have been shown to occur for firms in the Day (-11, +9) window before and after a firm’s lockup event (Day 0).
  • I Waited On The IPO But I'm Ready To Buy Trupanion At These Prices
    Editors' Pick TRUP Mon, Sep. 8, 1:30 PM Dallas Salazar 2 Comments

    Summary

    • TRUP, now at a 25% discount to initiation of coverage, is a good value for the numbers it just printed in Q2.
    • TRUP's top-line growth and less-efficient revenue replacement mechanism work together to create a growing return on customer acquisition costs.
    • TRUP's scaled-up efforts have worked beautifully to this point and I want to be long its non-financial metric growth at least into Q3.
  • Buy The Markets Inability To Recognize Borderfree's Revenue Recognition
    BRDR Mon, Sep. 8, 1:30 PM Dallas Salazar 4 Comments

    Summary

    • BRDR had a blowout quarter that has not been priced into the stock.
    • BRDR will see greatly accelerated non-financial and financial metric growth into Q3 and Q4.
    • BRDR is worth $21 per share and currently trades at $14 - leaving 50% upside to fair value.
  • Opower Is Set To Have A Huge Q3 And An Even Bigger End Of Year
    OPWR Mon, Sep. 8, 1:01 PM Dallas Salazar 1 Comment

    Summary

    • OPWR's hard work during 1H should soon become visible and reflect in the financials.
    • OPWR's 1H income statement is being confused with one that doesn't show bullish developments.
    • OPWR should have a blowout Q3 and Q4 as a result of its expense/revenue recognition dynamic.
  • I Rode The Heritage Insurance Risk Train For 20% But There's Plenty Of Stops Left On The Way To Higher Prices
    HRTG Mon, Sep. 8, 12:45 PM Dallas Salazar Comment!

    Summary

    • HRTG has posted an amazing 1H that has been rewarded by the market but still leaves plenty of upside left.
    • HRTG has a unique risk management strategy that has allowed it to insure the highest premium policies available.
    • HRTG should have a blowout Q3 and the end of hurricane season should act as a second short term catalyst.
  • Aspen Aerogels Balance Sheet And Shares Get A Reset Which Opens The Door For An Easy Short
    ASPN Mon, Sep. 8, 12:30 PM Dallas Salazar Comment!

    Summary

    • ASPN, despite its history of incompetence, was able to get to debt free as a result of its recent IPO.
    • ASPN should see a reduction of at least ~$15 million in interest expense during 2H/14 which has given bulls an excuse to prop the stock off the lows.
    • ASPN's operations have continued to get worse sequentially across all durations yet bulls have pumped the stock as a result of recent fund raising.
  • Why Alibaba Is A Big Deal (Largest IPO In History): Your Cheat Sheet
    BABA Mon, Sep. 8, 7:47 AM Abe Garver 49 Comments

    Summary

    • Although few retailer investors have heard of the company, the U.S.'s dominance in the e-commerce sector is poised to fall with the air apparent to Amazon set to IPO.
    • Amazingly, Alibaba's business is more profitable than Amazon and eBay put together.
    • Jack Ma's letter to Alibaba investors may revolutionize the way companies think about their culture and regard shareholders (not first or second, but third priority).
    • There are more voices in the press than one can shake a stick at, and this article shows you where to focus.
  • El Pollo Loco: Taking A Chance On The Crazy Chicken
    LOCO Sun, Sep. 7, 12:19 PM Khurram Aziz 13 Comments

    Summary

    • El Pollo Loco posted a profit of $6 million in the first quarter after IPO.
    • Currently, El Pollo Loco has 400 restaurants, they are planning to add three more by year's end, 9 to 11 during this fiscal year and eventually have 2,300 locations.
    • Net income per share has risen to $.21 from April to June. Compare that to $.01 per share for the quarter in the previous year.
  • Goldman Sachs, Yahoo Stand To Get The Gold In Alibaba IPO
    BABA Sun, Sep. 7, 7:02 AM Don Dion 27 Comments

    Summary

    • GS won the role of stabilization agent for Alibaba’s IPO, which allows them to handle early trading, and glean a significant portion of Alibaba’s anticipated $20 billion influx.
    • Yahoo also stands to gain, with a ~24% stake, roughly valued at $45 billion.
    • Goldman recently posted record quarterly net revenues, building on an already strong foundation, and is in a favorable environment for its businesses; while Yahoo should become a stronger tech competitor.
    • These are two important ripple effects of Alibaba's impending IPO.
  • Short-Term Losses, Trading Opportunity In Sight For Paylocity Holding Corp.
    PCTY Sat, Sep. 6, 8:20 AM Don Dion 1 Comment

    Summary

    • September 14 will mark the end of the 180 day lockup period initiated with the March 18, 2014 IPO of PCTY.
    • Recent research shows price declines of between (-2%) and (-5.5%) in the time period surrounding a company's lockup expiration.
    • Although PCTY has performed relatively well since bottoming out in May, the supply shock in sight with the freeing up of 41.9 million shares suggests a short opportunity ahead.
  • GoDaddy IPO S-1 Teardown
    DADDY Fri, Sep. 5, 10:29 PM IPO Candy 2 Comments

    Summary

    • An early read of the partial S-1 suggests a market cap of $2.8B to $4B post IPO.
    • Ownership by private equity firms complicates the structure and story a bit – could impact valuation.
    • Company strategy to increase ARPU using value-added services has had limited success so far.
    • Investors should expect an active M&A program post-IPO.
  • E-Commerce Home Goods Store One Kings Lane In IPO Pipeline
    KINGS Fri, Sep. 5, 6:10 PM Sramana Mitra Comment!
  • Q2 Holdings - With Apparent Volatility, Lockup Expiration Could Unleash A Short Opportunity For Aggressive Investors
    QTWO Fri, Sep. 5, 4:41 AM Don Dion 3 Comments

    Summary

    • September 15 will conclude the 180-day lockup period of over 24 million shares of QTWO, held by its pre-IPO shareholders, directors, and executives.
    • While QTWO does provide important services, the firm has shown a penchant for volatility on the market; while it continues to expand revenues, mounting losses are apparent.
    • We believe that the upcoming QTWO lockup period expiration may present a significant short opportunity for aggressive investors.
    • Recent research shows declines of -5.5% for firms in the time period surrounding their lockup expiration.
  • VC Firms, Including Goldman Sachs, Could Help Create A Short Opportunity For Amber Road At Expiration Of Lockup Period
    AMBR Thu, Sep. 4, 11:27 AM Don Dion 1 Comment

    Summary

    • The lockup period on AMBR will come to an end on September 17; at this point, AMBR's pre-IPO shareholders, executives, and directors will be able to sell their shares.
    • AMBR's price could decline by 5.5% around the time of the event, according to recent research, particularly given holdings by powerful VC firms, encompassing Goldman Sachs.
    • AMBR has shown revenue growth in recent years, but its losses have also ballooned; it isn't clear AMBR has the chops to compete with its heavyweight competitors.
    • We see a significant short opportunity ahead for investors, keen for an aggressive play, on AMBR.
  • Continental Building Products: A Multi-Year Bull Run Story
    Editors' Pick CBPX Thu, Sep. 4, 9:19 AM Dallas Salazar 13 Comments

    Summary

    • CBPX is currently trading at a significant discount to a peer group.
    • CBPX is positioned for strong FCF for at least the next three years.
    • CBPX has several strategic advantages that make it defensive in bad economic environments and offensive in good ones.
  • Significant Sell-Off Could Occur For Akebia Therapeutics At Lockup Expiration
    AKBA Wed, Sep. 3, 5:50 PM Don Dion 4 Comments

    Summary

    • ~13.5 million shares of Akebia Therapeutics are scheduled to become available for public sale on September 15, the end of the 180-day lockup period that began with the March IPO.
    • Akebia has fared inconsistently on the market since its debut in March; we are also concerned about its long-term prospects, given that it is far from commercializing any products.
    • Recent research shows price declines of between (-2%) and (-5.5%) in the time period surrounding a company's lockup expiration -- particularly if it has strong VC backing, as Akebia does.
    • The upcoming lockup period expiration could see significant sell-offs, however, given the substantial venture backing that Akebia has relied on.
  • E-Commerce Home Goods Store Wayfair Files For IPO
    W Wed, Sep. 3, 4:09 PM Sramana Mitra 1 Comment
  • Pre-IPO Shareholders Of A10 Networks Could Be Eager To Sell At IPO Lockup Expiration
    ATEN Wed, Sep. 3, 3:51 PM Don Dion 3 Comments

    Summary

    • September 16 will mark the end of the 180 day lockup period on ATEN that began with the application networking technologies firm's March 20 IPO.
    • At this point, the firm’s pre-IPO shareholders, directors and executives will likely begin selling their 46.5 million shares in the company-- nearly four times ATEN’s IPO shares.
    • ATEN had a disappointing performance post-IPO; we suspect that shareholders will be eager to sell off their shares of the ailing stock with the conclusion of the lockup period.
    • With negative abnormal returns in 2014 shown to be (-5.5%) in the days surrounding a firm's IPO lockup expiration, we see ATEN's upcoming event as a short opportunity.
  • Is Emaar's IPO Worth A Look?
    Wed, Sep. 3, 9:51 AM Khurram Aziz 2 Comments

    Summary

    • Emaar Properties owns EMG. EMG is the developer of The Dubai Mall and the Burj Khalifa, the world's tallest building.
    • EMG has shown revenues of $340 million so far this year.
    • The government of Dubai is a major investor in Emaar.
    • Dubai needs an infusion of cash.
    • EMG is a solid company that may be helping to bring Dubai out of its financial crisis.
  • Alibaba: The Breakout IPO Of 2014
    BABA Wed, Sep. 3, 8:05 AM Khurram Aziz 38 Comments

    Summary

    • Alibaba is the largest ecommerce site in China.
    • Alibaba is expected to raise up to $20 billion on its first day of trading.
    • Although not well-known in the United States, Alibaba is China's largest ecommerce site and does everything that PayPal, eBay and Amazon.com do, but is twice the size.
    • As opposed to the Facebook IPO, Alibaba's value is expected to continue rising.
  • TubeMogul: Buy The Dips
    TUBE Tue, Sep. 2, 5:51 PM Dallas Salazar 4 Comments

    Summary

    • TubeMoghul has a unique platform and a unique distribution and sales method.
    • TUBE's organic platform growth has helped to smooth out quarterly revenue growth and should help surprise to the upside at earnings.
    • All the financials at TUBE are bullish and are accelerating in a bullish direction.
  • Catalent Quiet Period Expiration Could Be Catalysts For Upward Move
    CTLT Tue, Sep. 2, 1:55 PM Don Dion Comment!

    Summary

    • The 40-day quiet period on CTLT will come to an end September 8, allowing the firm's IPO underwriters to publish analyses of the Blackstone-backed drug delivery firm on September 9.
    • Recent research shows above-market returns in the (-5, +2) days surrounding a firm's quiet period expiration.
    • Though CTLT got off to a slow start on the market, we remain optimistic given its very strong underwriters and backing by The Blackstone Group.
  • Zhaopin Limited: An Online Professional Networking Website Worth Buying Into
    ZPIN Mon, Sep. 1, 10:37 AM Daniel Lynch 1 Comment

    Summary

    • Zhaopin had its IPO on June 12, 2014, and has not yet experienced an IPO run.
    • ZPIN provides a convincing argument for potential for growth investors and chart traders alike.
    • The company has been featured on TheStreet.com.
    • ZPIN announced its first quarterly earnings as a publicly traded company.
    • The company currently trades below the low, median, average, and high yearly price targets.
  • Transocean Partners Had A Great First Month, But Can It Keep Up The Pace?
    RIGP, RIG Mon, Sep. 1, 9:39 AM Anthony Ruben 21 Comments

    Summary

    • RIGP is up over 30% from its IPO price.
    • Three "Buys" and one "Hold" from initial analyst reports.
    • "Parent" RIG is the biggest loser in this transaction.
  • What Effect Might Alibaba Have On Other Chinese Stocks?
    BABA Mon, Sep. 1, 8:53 AM Cabot 10 Comments

    Summary

    • China’s Singles Day bests Black Friday and Cyber Monday.
    • Alibaba generates 80% of China’s entire online sales.
    • How Alibaba’s IPO could affect other Chinese stocks.
  • Alibaba's Ma Tops Rich List As Profits Leap
    BABA Fri, Aug. 29, 7:37 AM Doug Young 4 Comments