Why the Airpin is worth $ 101 billion and the Door Dash is worth $ 66 billion will end badly and quickly
Airbnb (ABNP) And Door Dash (DASH) Should come out of the financial burst as public companies, given the borderline crazy ratings, the worst investors will be given to both on their respective IPO days.
In other words, with such valuable ratings from the tab for untested war rental and food delivery businesses – expect street sky and moon from co-founders and CEOs Brian Cesky (Airbnb) and Tony Sue (Door Dash) each earnings day, perhaps, for the next five years.
Good luck living up to those expectations every three months.
“These companies [Airbnb and Doordash] We need to create decisions that meet or win investors’ expectations, ”said Kathleen Smith, chief of Renaissance Capital. Yahoo told Accounting Live. “The menu is set to be the highest by looking at one-day performance.”
You don’t play about wild one day shows.
Airbnb finally opened for business At 6146 per share on Thursday, the initial public offering price was $ 68. Airbnb’s initial trading value was $ 101.6 billion.
For some perspectives on real-life market mania, this is $ 80 billion more than the combined market caps of Airpin’s established rivals Marriott, Hilton and Hyatt. This is more than the $ 62 billion market of 112-year-old auto company General Motors (which sits on some sport-transforming electric vehicle technology. GM CEO Mary Barra recently told Yahoo Accounting Live).
The Market Welcome to Tortosh’s IPO Nothing to sneeze on Wednesday.
Shares of the food delivery service rose about 80% on the first day of trading on the New York Stock Exchange. Shares of Turdash returned 8% on Thursday The $ 66 billion north market cap is playing. This is more than the 6 18.6 billion market value of Burger King and Bobai-owned restaurant brands.
“There’s a lot of excitement about companies that are well known to the mass consumer. Tortosh and Airpin are very familiar names, and they get a warm welcome when they come out,” Smith said of the exciting market introductions. Over the next couple of months we’re going to look back and see if Kee can tell if they had so much money on the table or not. We’ll see. “
Why this could end badly for investors in both companies – at least those who chase IPO-day momentum – downplays what Smith said about sky-high expectations and financial realities.
Since its inception in 2008, Airpin has suffered a total loss of $ 2.1 billion. It recorded a loss of $ 697 million in the first nine months ending Sept. 30. Whose guess is that this could turn a profit post into an epidemic.
But the street wants to see a clear path for airline profits on its first revenue day (unlike Uber) Endure since its 2019 IPO from Wall Street) Due to its crazy market introduction. There is no quick path to profits from Cesky and his management team making a profit for the thirsty Wall Street, and stocks can easily be placed in the penalty box.
The same is true for the Zoo Over in Turdash, which oversees a business that lost $ 149 million in the first nine months of 2020. Large parts of the country order food from home during COVID-19 epidemics.
Congratulations to these two executives on that first revenue call. The menu will be high.
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