Sunday, August 13, 2017

HAS THIS STOCK REALLY SNAPPED?

Dear readers, Snap Inc, the company behind Snapchat saw its stock (NYSE: SNAP) headed south by 14.09% on Friday 11 Aug 2017 to reach a close of USD 11.83. Compare this price with its IPO price of USD 17 and we can see that this current price is really a 30% discount off its IPO price. SNAP even traded at a high of around USD 27 before. I could still remember reading that there was some kind of excitement over this tech stock when it debut on IPO but now we know that this IPO might have really snapped if its price does not go back north.

In Singapore, I still could recall Hutchison Port Holdings IPO had its debut in year 2011 at USD 1.01 amidst excitement at the mega size of its IPO. Look at Hutchison Port Holding Trust price now: the price is at USD 0.45, a decline of more than 56% from the IPO price.

The lesson for investments is to always know what we are investing. IPOs are always attractive as investors thought that IPOs are always priced at baseline for which the price will develop north. But in many cases, at least for the two examples shown here, that is not always true. Join the emailing list to receive regular Financial and Singapore stocks newsletters too! Like" me on Singapore Stocks Investing Facebook page to receive all posts on your Facebook as well as read more articles. Follow me on Twitter too.
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