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Don Dion
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Don Dion (donalddion@gmail.com) is the owner and Chief Investment Officer of DRD Investments, LLC, based in Naples, FL. and Williamstown, MA., a family office focused on managing a long/short hedge fund, real estate assets and various other financial assets for the Dion family. Don no longer... More
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  • Levy Acquisition IPO Is A Wild Card

    Levy Acquisition Corp (LEVYU), a blank check firm that intends to acquire businesses in its management team's areas of experience-restaurants and hospitality-plans to raise $150 million in its upcoming IPO this week. The Chicago, IL-based firm will offer 15.0 million shares at a price of $10 per share. If the IPO is successful, LEVYU will command a market value of $188 million. See
    http://www.sec.gov/Archives/edgar/data/1585583/000114420413054104/v355877_s1.htm
    LEVYU filed on October 7, 2013.
    Lead Underwriters: Citigroup Global Markets Inc.
    Underwriters: I-Bankers Securities, Maxim Group LLC, National Securities Corp.

    Summary
    LEVYU is a blank check company that intends to acquire businesses in the restaurant and hospitality sectors. The firm will be led by Chairman and CEO Lawrence F. Levy, who built Levy Restaurants from the ground up and also founded Levy Family Partners, a somewhat similar investment firm that has invested in numerous successful restaurant and hotel businesses. LEVYU will essentially function as a vehicle for Mr. Levy and his management team to make larger investments than the $25 million maximum that Levy Family Partners generally runs under. The firm has not yet targeted or discussed any specific potential investments.

    Valuation
    LEVYU offers the following figures in its S-1 balance sheet:

    Revenue: $0.00
    Net Loss: ($5,169.00)
    Total Assets: $89,925.00
    Total Liabilities: $70,094.00
    Stockholders' Equity: $19,831.00

    LEVYU does not have especially meaningful financial figures at this point, since it intends to acquire the funds to begin doing business through the IPO.

    Management
    Chairman and CEO Lawrence F. Levy is a Co-Founder and Chairman of the Chicago-based Levy Restaurants, an international food service company that Mr. Levy co-founded with his brother in 1978. As Executive Chairman and CEO, Mr. Levy was responsible for all aspects of operations, strategy, growth, and various other functions of the firm. During his time as Executive Chairman and after he became non-executive chairman in 2006, Mr. Levy has continued to actively participate in significant company initiatives and to advise senior management on all aspects of the company, including strategy, operations and corporate development.

    Mr. Levy is also the Founder and a Managing Partner of Levy Family Partners, a family investment office that oversees a broad portfolio of public and private investments, including hospitality, real estate, and technology companies. Mr. Levy received his B.S. and M.B.A. from Northwestern University.

    Conclusion
    Investors in LEVYU will essentially be betting on the investment and management ability of Mr. Levy and his team. It should be noted that neither Mr. Levy nor his team have previously been involved in an investment enterprise of this magnitude; however, we believe that his significant experience in evaluating and investing in restaurants and hospitality businesses will give LEVYU a strong possibility of success.

    We rate this IPO neutral at the $10 price target and we will wait and see what they acquire and how those investments perform before considering buying this stock.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Tags: ipo-analysis
    Nov 12 12:20 PM | Link | Comment!
  • JGW IPO Update

    We are hearing that the JGWPT Holdings IPO (JGW) scheduled for tomorrow with an original price range of $19 to $22 has been reduced to $15 to $17 and the number of shares to be sold has been reduced from 12.2M to 9.75M

    See http://seekingalpha.com/article/1814902-jgwpt-holdings-ipo-should-reduce-price-range-to-15-to-17

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Tags: JGW, IPO, Financial
    Nov 07 5:59 PM | Link | Comment!
  • Twitter IPO Will Fly

    Twitter (TWTR) burst onto the scene at a time when social media was still a novelty, and many people doubted whether there was room for yet another site for personal interaction. However, TWTR has become one of the foremost Internet sites, drawing tweets from such diverse personalities as Pope Francis, Lady Gaga and Warren Buffett (BRK.B)

    Twitter came into being a mere six years ago, designed by Jack Dorsey and Evan Williams. It offered users many of the same features as Facebook but with a fast-paced "micro-blogging" system that allowed people to interact both immediately and on-the-go. The popularity of smartphones only increased its use and made "tweets" one of the primary means of communication for the Internet community.

    Today, Twitter has 230 million monthly users, and is one of the most quoted media site in media. Although many people use Twitter to stay on top of activities of their favorite celebrities, it has also become a force in the political realm. The 2012 election was instrumental in showing the power of its "micro-blog" feature, allowing users to comment on debate performances, question pundits' commentary and interact with others on a variety of topics.

    The IPO of this highly visible company has been awaited with some anticipation by investors. The site clearly has longevity and will be a force in American culture for some time, providing many opportunities for marketing to a broadly diverse population. In October of 2013,

    Twitter announced its intention to sell 70 million shares at $17 to $20 each, significantly lower than the company's expected value. Even in the middle range of that price, the company will bring in $10 billion along with what will be raised from the exercise of the options. The company has also recently moved up the pricing date to November 6th of 2013.

    Twitter has been showing considerable growth over the past months, making the low initial price a bit of a surprise to many of us. In August, the company valued itself at $20.62 per share, and analyst Robert Peck of Suntrust Robinson Humphrey already expects the stock to reach $50 a share by the end of 2014.

    The conservative offering appears to be a reaction to the ill-fated May 2012 IPO of Facebook (FB), whose $38 stock immediately plummeted and remained below offered levels for some time before slowly recovering. The sluggish start of both Groupon (GRPN) and Zynga (ZNGA), increased doubts about success of Internet IPOs. Twitter is taking a more cautious approach with its lower price, hoping investors will cast a more favorable eye on the offering at this level. See also http://seekingalpha.com/article/1738662-twitter-ipo-avoids-the-facebook-pump-and-dump

    CONCLUSION AND RATING
    Investors who have been waiting for Twitter to initiate its IPO will be happy to get allocations at the $17 to $20 level and we continue to rate the IPO a buy at that price range.

    Although the company has yet to make a profit, the site's continued popularity makes it a good bet for future gains in the price of the Twitter stock.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Oct 27 3:01 AM | Link | Comment!
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