Robinhood Markets tumbled on Thursday after early investors filed to sell nearly 100 million of their Class A common shares less than a week after its initial public offering.
The trading platform’s stock sank 28 per cent to $50.97 as investors proposed to sell up to 97.88 million of shares over time.
None of the proceeds will be received by Robinhood, with the selling stockholders getting all of the funds from the sales, according to a filing with the US Securities and Exchange Commission.
The listed sellers are a group of investors who in February took part in a $3.55 billion convertible debt sale by Robinhood as a frenzied surge in meme stocks left it facing a potentially massive margin call.
Thursday’s filing allows for those involved in the first tranche of convertible debt to sell half their shares, while the remaining 50 per cent need to be held until August 25.
The largest of those holders, Venture capital firm New Enterprise Associates, could trim its roughly 10 per cent stake by about 3.9 per cent or 2.9 million shares. Other sellers named in the filing include entities affiliated with Andreessen Horowitz, Iconiq Capital and Ribbit Capital.
Such early selling by major investors highlights another unusual quirk of Robinhood’s IPO. While most public offerings these days are accompanied by a six-month lock-up period where insiders are barred from touching their holdings, employees and directors at Robinhood were able to sell a portion of their shares as soon as the first day of trading.
The latest filing comes just a day after shares in the zero-fee trading platform soared 50 per cent as a flood of retail traders joined larger investors, such as Cathie Wood’s flagship ARK Innovation exchange-traded fund, in buying the stock.
Individual investors were a key driver of Wednesday’s volatility with Robinhood being the fourth most traded stock on the day across retail trading platforms, according to data compiled by Vanda Securities. Retail traders exchanged $467 million worth of shares with $50.5m in net purchases, the data show.
The spike in interest from individual investors despite Robinhood’s underwhelming IPO is a departure from companies like Coinbase Global or DiDi Chuxing, which saw huge retail demand that quickly waned, according to Vanda’s Ben Onatibia. “After a poor listing, retail demand is surging, something extremely rare with IPOs,” he said in an email.
Some analysts are staying cautious. “We cannot in good faith recommend investors get involved in HOOD on either the long or short side,” Wolfe Research analyst Steve Chubak wrote in a note, initiating coverage on Robinhood with a hold-equivalent rating and a share price target of $45.
After a poor listing, retail demand is surging, something extremely rare with IPOs
Ben Onatibia,
Vanda Securities
Shares fell more than than 8 per cent on their first day of trading last week after Robinhood priced its IPO at the low end of its expected range. They then went on to rally for four straight days, including Wednesday’s surge that at one point reached as much as 82 per cent and ballooned Robinhood’s market capitalisation to a peak of $65bn.
COMPANY%20PROFILE
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Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
Planes grounded by coronavirus
British Airways: Cancels all direct flights to and from mainland China
Hong Kong-based Cathay Pacific: Cutting capacity to/from mainland China by 50 per cent from Jan. 30
Chicago-based United Airlines: Reducing flights to Beijing, Shanghai, and Hong Kong
Ai Seoul: Suspended all flights to China
Finnair: Suspending flights to Nanjing and Beijing Daxing until the end of March
Indonesia's Lion Air: Suspending all flights to China from February
South Korea's Asiana Airlines, Jeju Air and Jin Air: Suspend all flights
The specs
Engine: 4.0-litre, twin-turbocharged V8
Transmission: nine-speed automatic
Power: 630bhp
Torque: 900Nm
Price: Dh810,000
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
GOLF’S RAHMBO
- 5 wins in 22 months as pro
- Three wins in past 10 starts
- 45 pro starts worldwide: 5 wins, 17 top 5s
- Ranked 551th in world on debut, now No 4 (was No 2 earlier this year)
- 5th player in last 30 years to win 3 European Tour and 2 PGA Tour titles before age 24 (Woods, Garcia, McIlroy, Spieth)
Springsteen: Deliver Me from Nowhere
Director: Scott Cooper
Starring: Jeremy Allen White, Odessa Young, Jeremy Strong
Rating: 4/5
Result
Arsenal 4
Monreal (51'), Ramsey (82'), Lacazette 85', 89')
West Ham United 1
Arnautovic (64')
The specs
Engine: 1.5-litre, 4-cylinder turbo
Transmission: CVT
Power: 170bhp
Torque: 220Nm
Price: Dh98,900
COMPANY%20PROFILE
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COMPANY%20PROFILE
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Cricket World Cup League Two
Oman, UAE, Namibia
Al Amerat, Muscat
Results
Oman beat UAE by five wickets
UAE beat Namibia by eight runs
Fixtures
Wednesday January 8 –Oman v Namibia
Thursday January 9 – Oman v UAE
Saturday January 11 – UAE v Namibia
Sunday January 12 – Oman v Namibia
%E2%80%98FSO%20Safer%E2%80%99%20-%20a%20ticking%20bomb
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GIANT REVIEW
Starring: Amir El-Masry, Pierce Brosnan
Director: Athale
Rating: 4/5
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UAE currency: the story behind the money in your pockets
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
Islamophobia definition
A widely accepted definition was made by the All Party Parliamentary Group on British Muslims in 2019: “Islamophobia is rooted in racism and is a type of racism that targets expressions of Muslimness or perceived Muslimness.” It further defines it as “inciting hatred or violence against Muslims”.
Bombshell
Director: Jay Roach
Stars: Nicole Kidman, Charlize Theron, Margot Robbie
Four out of five stars
Company Fact Box
Company name/date started: Abwaab Technologies / September 2019
Founders: Hamdi Tabbaa, co-founder and CEO. Hussein Alsarabi, co-founder and CTO
Based: Amman, Jordan
Sector: Education Technology
Size (employees/revenue): Total team size: 65. Full-time employees: 25. Revenue undisclosed
Stage: early-stage startup
Investors: Adam Tech Ventures, Endure Capital, Equitrust, the World Bank-backed Innovative Startups SMEs Fund, a London investment fund, a number of former and current executives from Uber and Netflix, among others.
Common OCD symptoms and how they manifest
Checking: the obsession or thoughts focus on some harm coming from things not being as they should, which usually centre around the theme of safety. For example, the obsession is “the building will burn down”, therefore the compulsion is checking that the oven is switched off.
Contamination: the obsession is focused on the presence of germs, dirt or harmful bacteria and how this will impact the person and/or their loved ones. For example, the obsession is “the floor is dirty; me and my family will get sick and die”, the compulsion is repetitive cleaning.
Orderliness: the obsession is a fear of sitting with uncomfortable feelings, or to prevent harm coming to oneself or others. Objectively there appears to be no logical link between the obsession and compulsion. For example,” I won’t feel right if the jars aren’t lined up” or “harm will come to my family if I don’t line up all the jars”, so the compulsion is therefore lining up the jars.
Intrusive thoughts: the intrusive thought is usually highly distressing and repetitive. Common examples may include thoughts of perpetrating violence towards others, harming others, or questions over one’s character or deeds, usually in conflict with the person’s true values. An example would be: “I think I might hurt my family”, which in turn leads to the compulsion of avoiding social gatherings.
Hoarding: the intrusive thought is the overvaluing of objects or possessions, while the compulsion is stashing or hoarding these items and refusing to let them go. For example, “this newspaper may come in useful one day”, therefore, the compulsion is hoarding newspapers instead of discarding them the next day.
Source: Dr Robert Chandler, clinical psychologist at Lighthouse Arabia
RACECARD
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The specs: 2018 Nissan Patrol Nismo
Price: base / as tested: Dh382,000
Engine: 5.6-litre V8
Gearbox: Seven-speed automatic
Power: 428hp @ 5,800rpm
Torque: 560Nm @ 3,600rpm
Fuel economy, combined: 12.7L / 100km
THE NEW BATCH'S FOCUS SECTORS
AiFlux – renewables, oil and gas
DevisionX – manufacturing
Event Gates – security and manufacturing
Farmdar – agriculture
Farmin – smart cities
Greener Crop – agriculture
Ipera.ai – space digitisation
Lune Technologies – fibre-optics
Monak – delivery
NutzenTech – environment
Nybl – machine learning
Occicor – shelf management
Olymon Solutions – smart automation
Pivony – user-generated data
PowerDev – energy big data
Sav – finance
Searover – renewables
Swftbox – delivery
Trade Capital Partners – FinTech
Valorafutbol – sports and entertainment
Workfam – employee engagement
