By Jacob Wolinsky. Originally published at ValueWalk.
- Last week Deliveroo set the range between £3.90 to £4.60 valuing the company at up to £8.8 billion.
- Today it narrowed the range to £3.90 and £4.10 valuing the company at up to £7.85 billion
Deliveroo Narrows Its IPO Target Range
Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown
"By narrowing its IPO target range, Deliveroo is trying to make sure it doesn’t hit a bump in the road as it begins its journey on the stock market. It's likely initial orders for the IPO have come in nearer the bottom of the target range, and by setting its sights nearer those prices, it is managing expectations on its ride to listed status.
It may be blaming volatile market conditions for the move, but the rejection of the IPO by a slew of institutional investors is likely to also have caused some concern at the delivery company.
Whereas Doordash and AirBnB benefited from sustained euphoria among shareholders after they went public at the end of last year, review site Trust Pilot has seen its share price slide after the initial pop. It priced its offering at the very top of the range. Doordash listed in New York has also seen its valuation slide sharply from its February high.
Clearly Deliveroo, already facing criticism over the working conditions of its riders, doesn’t want to puncture the prospects of a successful launch."
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The post Deliveroo Narrows Its IPO Target Range In ‘Volatile’ Trading Conditions appeared first on ValueWalk.
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