WIKIFX REPORT: Robinhood id one of the worst IPOs since the start of the pandemic

Robinhood Markets Inc. shares are in a tailspin that‘s placed them among the worst high-profile global stock market debuts since the onset of the pandemic, joining the likes of China’s Didi Global Inc. and Londons THG Plc.

Robinhood Markets Inc. shares are in a tailspin that‘s placed them among the worst high-profile global stock market debuts since the onset of the pandemic, joining the likes of China’s Didi Global Inc. and Londons THG Plc.

The retail brokerage has plunged 67% since its July initial public offering, making the stock one of the worst performers among companies that raised $2 billion or more on global exchanges since early 2020. Earlier Friday, the drop was even more pronounced as the stock initially sank after the company reported fourth-quarter revenue and losses that were worse than analysts expected. However, it stormed back for its best day in four months to rise 9.7% on the day.

For Robinhood, the hits came from all directions: net loss was steeper than anticipated, monthly active users dropped about 8% from the previous quarter and average revenue per user tanked. And a broader rout in stocks with frothy valuations isnt helping either.

Its stock selloff has delivered big gains on paper for investo7rs who have bet against the brokerage. Short sellers had seen more than $700 million in mark-to-market gains since its debut through trading Thursday evening, according to data compiled by financial analytics firm S3 Partners. And skeptics have continued to be active with roughly 10 million new shares shorted, worth $127 million, over the last thirty days, S3 said in an email to Bloomberg.

“Were seeing a change in IPO performance, which often you see after a bull market,” said James Congdon, who runs the Quest research unit at broker Canaccord Genuity. “Before the blue-chip selloff, you see the concept stocks being valued on successful execution strategies being sold off.”

In the U.S., last years IPO class is now trading more than 20% below their offering prices on average, according to data compiled by Bloomberg. The Renaissance IPO ETF, which holds stocks that went public over the past several years, is having its worst month ever with a 26% loss so far.