{"id":3919,"date":"2017-03-07T00:43:44","date_gmt":"2017-03-07T00:43:44","guid":{"rendered":"https:\/\/www.rsoftsolution.com\/blog\/snap-tumbles-12-on-day-three-erases-gains.html"},"modified":"2017-03-07T00:43:44","modified_gmt":"2017-03-07T00:43:44","slug":"snap-tumbles-12-on-day-three-erases-gains","status":"publish","type":"post","link":"https:\/\/www.rbsitsoftwaresolution.in\/blog\/snap-tumbles-12-on-day-three-erases-gains.html","title":{"rendered":"Snap tumbles 12% on day three, erases gains"},"content":{"rendered":"


\n<\/p>\n

Snapchat parent Snap Inc. debuted on the stock market Thursday\u00a0and immediately saw substantial gains<\/a>\u00a0on its first two days.\u00a0But the excitement has already worn off, with shares tumbling more than 12 percent on day three.<\/p>\n

After finishing Friday at $27.09 per share, Snap closed\u00a0at $23.77 on Monday, beneath the $24 where it opened on its first day of trading. This is still above the $17 IPO price, but only select institutional investors and high-net worth individuals<\/a>\u00a0were able to buy it that low.<\/p>\n

\u201cSome of the air is coming out of the stock,\u201d said Kathleen Smith, principal at Renaissance Capital. \u201cThe stock had really run up beyond the expectations of most people who look at fundamentals,\u201d she said, referencing Snap\u2019s sub par financials.\u00a0<\/a><\/p>\n

Smith, who also manages IPO-focused ETFs, was surprised by the company\u2019s market cap, which is already about $35 billion (fully diluted). \u201cThe company has to basically cure cancer or something with its app,\u201d to justify that kind of value, she quipped.<\/p>\n

Snap is already\u00a0considered to be\u00a0worth more than American Airlines, Hershey\u2019s and Hilton Hotels, with its sky-high market cap.<\/a>\u00a0With the stock trading down today, it seems that some\u00a0investors are starting to wonder if Snap\u2019s app warrants it. (They also have a hardware product, Spectacles)<\/a>.<\/p>\n

But the IPO was generally regarded as a success, with the offering raising $3.4 billion for the company. The strong investor appetite suggests that they could have priced their IPO even higher and raised more than $4 billion.<\/a><\/p>\n

It\u2019s considered a good sign for other potential tech IPOs that the company was greeted with such enthusiasm. There are many highly valued \u201cunicorns\u201d like Airbnb and Uber\u00a0that have been sitting on the sidelines.<\/p>\n

Many pipeline companies have been afraid to go public because they could have a market cap that\u2019s beneath their last private round. Square was a notable example of this, but is finally trading at\u00a0its private market valuation of $6 billion.<\/p>\n

Time will tell whether Snap will be more like Facebook, which has done great in the public markets, or Twitter, which has had a volatile ride.<\/p>\n

<\/p>\n

Featured Image: Michael Nagle\/Bloomberg via Getty Images<\/small><\/p>\n

Article source: http:\/\/feedproxy.google.com\/~r\/techcrunch\/social\/~3\/6sAS9NYXCxA\/<\/p>","protected":false},"excerpt":{"rendered":"

Snapchat parent Snap Inc. debuted on the stock market Thursday\u00a0and immediately saw substantial gains\u00a0on its first two days.\u00a0But the excitement has already worn off, with shares tumbling more than 12 <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[3],"tags":[10,7,14,15,6,12,11],"class_list":["post-3919","post","type-post","status-publish","format-standard","hentry","category-latest-update","tag-computer-news","tag-downloads","tag-microsoft-download-news","tag-networking-updates","tag-technology-update","tag-wordpress-plugin-download","tag-wordpress-theme-download"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t