Reportedly, GrubHub Seamless Inc. has made a confidential
filing with the Securities and Exchange Commission for an initial
public offering (IPO).
GrubHub Seamless is a mobile and online food-ordering company
with a catalogue of more than 26,500 take-out restaurants in
roughly 600 U.S. cities and London. It was formed when
Chicago-based Grubhub and New York-based Seamless - two of the
leading U.S. online food ordering services - merged in May
The combined entity processes about 150,000 customer orders on
a daily basis. In 2012, the company generated sales of more than
$100 million. GrubHub Seamless' filing can be kept confidential
as that the law allows any company with less than $1 billion in
revenues in the past fiscal year can initially file an IPO
secretly with regulators.
The company is expected to launch the IPO in the first half of
the year. No details were made available beyond the confidential
announcement. Given the lack of details, it is reasonable to
assume that a GrubHub Seamless IPO still might be some way off,
but it is worth speculating whether the company will be a good
GrubHub Seamless is making great progress to improve revenues,
thanks mostly to a surge in mobile users and increasing demand
for online food ordering services. The frequent use of tablets
and smartphones has fueled the growth in the online food ordering
market. According to a new study by the Interactive Advertising
Bureau (IAB) and Viggle, approximately 69% of consumers order
food online using a mobile device. They use their mobile devices
to find out restaurant locations, check out menus and read
Most recently, GrubHub Seamless announced a partnership with
Foursquare that will allow Foursquare users to order takeout
directly through the app available on all iOS and Android
devices. Considering Foursquare's user base of over 45 million,
we believe that this significantly expands GrubHub's reach.
The 2013 IPO market delivered its best performance in more
than a decade. As per IPO research intelligence Renaissance
Capital, 2013 was the banner year for the IPO market, as 222
companies completed their IPOs, raising nearly $55 billion. Most
of the companies that went public last year have outperformed the
broad markets and many generated triple-digit returns. These
), up 82.0% since its IPO,
), up 26.1%, and
), up triple-digits.
This trend will likely continue this year given a surging
stock market, improving economic fundamentals and increasing
consumer confidence. Other companies which are expected to
go public this year include Coupons.com Inc. and GoPro Inc.,
which have also filed confidentially for their IPOs. Online
storage company Box Inc. and web home-goods retailer Wayfair LLC
have also hired banks to ready potential IPOs.
This is clearly a great environment to bring a fresh consumer
technology stock to market, but pricing is hard to predict given
the lack of available details.
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