An IPO With No Fancy
By Fri, Apr 24, 2020
Hey Scoopers,
The stock market indices barely moved despite an ever-increasing unemployment rate. — More on that in the “Overall Market” section.
Beyond the overall market, one underperforming company made investors happy by raising more money while another well-performing company annoyed investors by withdrawing its 2020 forecast. — More on that in the “What’s Up?” and “What’s Down?” sections.
Oh, by the way, did you notice the first fantasy sports’ IPO that went through without any fancy? — More on that in the “Water Cooler” section.
But, first, here is a recap of what happened in the market yesterday:
Market Recap
- U.S. markets: The three indices didn’t agree on the direction of the market but also didn’t budge much either. Scroll down to the “Overall Market” section to read more.
- Cryptocurrency: Contrary to the stock market, Bitcoin’s price surged to the mid-$7,000 range. The surge in the price was mostly associated with the higher volatility in preparation for the expiration of the Bitcoin futures contract on Friday.
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Two Opposing Forces
Stock market indices barely moved on Thursday as opposing forces balanced each other out. On the one hand, more than four million additional people claimed unemployment. On the other hand, Congress passed another round of economic relief package. Ultimately, investors couldn’t decide which direction to go, and the stock market indices finished Thursday barely budging.
Higher Chance Of Survival
So, what happened?
Shares of Expedia (Ticker: EXPE) were up more than 3% on Thursday. As a result of COVID-19’s interruption in global travel, the stock had lost more than 40% of its value year-to-date. However, the company announced that it has managed to secure more than $3 billion cash to fund its operations through the rough waters of the COVID-19 pandemic thanks to a combination of investment and debt financing agreements with Silver Lake Investment and Apollo Investment groups. Cash is one of the most important tools the companies would need to survive the COVID-19 storm, and Expedia just drastically increased its survival chance.
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Have No Forecast 2020
So, what happened?
Shares of Intel (Ticker: INTC) were down more than 7% on Thursday. The company announced its quarterly earnings report and shared more than a 20% increase in its revenue during the quarter. Despite the noteworthy performance, the company withdrew its earlier forecast for 2020, sighting the economic uncertainty fueled by the COVID-19 pandemic as the reason.
Fantasy Sports IPO Without Any Fancy
So what happened here?
DraftKings, one of the pioneers of fantasy sports in the U.S., went public without any fancy. The company took the same route as Virgin Galactic (Ticker: SPCE) to go public and merged with an already public special-purpose company known as Diamond Eagle.
It’s a strange time to go public, and it’s only such a special arrangement that has allowed the company to be able to close the transaction without worrying about an IPO roadshow and other fancy bells and whistles that typically go with initial public offerings. The company will be available under ticker DKNG, and we will be covering it soon when there is some data becomes available.
Let us know whether you have any plans to be a DraftKings’ investor?. Our email is members@tradestocks.com.
About the Author
The authors of this Scoop are the editorial team at Stock Card, led by Hoda Mehr. Hoda Mehr is CEO and Co-founder of Stock Card and the host of Renegade Investors podcast. She runs a community of 40,000 stock market investors and manages Stock Card's successful flagship portfolio, Roll with Our CEO, on Stock Card Portfolio Store. Hoda is an Economist with an MBA from Concordia, John Molson School of Business. She applies behavioral economics, data journalism, and storytelling to all aspects of her work. Before starting Stock Card, Hoda worked as a strategy and insights lead at technology companies including Symantec, Aimia and Sony. Create a free account to do your stock market research easily and mistake-free: Stock Card Stock Card
