Credit: Shutterstock photoShiftPixy ( PIXY ) popped 66% on Wednesday after it issued a press release stating that its business is a prime use case for implementing blockchain.
Poor post-IPO performance
The company offers a platform for restaurants to fill shifts with temporary workers. Its June 2017 Reg A+ IPO raised $12 million at a market cap of $180 million. Since then, its stock fell from an offer price of $6.00 to $2.57 at Tuesday's close (-57%). The stock rallied 66% after the announcement, closing Wednesday at $4.27 (-29% from IPO).
A new scheme for recording data
ShiftPixy's IPO prospectus did not mention blockchain, or how distributed ledger technology could help it take advantage of the Gig Economy. The press release states that it is currently recording human capital data in its blockchain ledger.
Operating losses widen in MRQ
In January, ShiftPixy reported quarterly revenue of $6.5 million (+15%). Gross profit declined to $1.2 million (19% margin) from $2.0 million (34%). Operating cash flow dropped to -$3.1 million; at period-end, ShiftPixy had $2.8 million in cash.
Third instance of a blockchain pop
Long Island Iced Tea Corp. , a 2016 IPO, announced in December that it would shift from ready-to-drink beverages to blockchain and cryptocurrency technology, and changed its name to Long Blockchain ( LBCC ). Since spiking 180%, its stock has since settled to pre-announcement levels, and is once again at risk of being delisted from the Nasdaq. Longfin ( LFIN ), a 2017 Reg A+ IPO with a low float, went from about $5 to $72 (+1,243%) in December after it announced a blockchain acquisition; it now trades around $35 with low volume.
Reg A+ IPOs have underperformed
ShiftPixy's -29% return gives it the #2 spot among the 9 Reg A+ IPOs, behind only Longfin.
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The article Another blockchain hail mary: 2017 IPO ShiftPixy pops 66% on press release originally appeared on IPO investment manager Renaissance Capital's web site renaissancecapital.com.
Investment Disclosure: The information and opinions expressed herein were prepared by Renaissance Capital's research analysts and do not constitute an offer to buy or sell any security. Renaissance Capital, the Renaissance IPO ETF (symbol: IPO) or the Global IPO Fund (symbol: IPOSX) , may have investments in securities of companies mentioned.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
