Investors noticed the drop in the NASDAQ index (by 1.2%) in the last week. The hot returns in initial public offerings in that time outshined the sector. At a $60-billion valuation, the newcomer has a market cap that is half that of Starbucks (NASDAQ:SBUX). That run-up is admirable from a stock price accomplishment, only.
DoorDash (NYSE:DASH) operates in a competitive space. Consumers have plenty of alternatives. This includes Uber Eats, Zomato, GrubHub, Postmates, and Waitr (NASDAQ:WTRH). DoorDash happened to improve its operational costs and efficiencies, helped by its staff.
Lucky investors who bought the stock at the $39-billion valuations will have earned around 80% in a single day. Anyone else buying days after the listing is at risk of holding the stock on the way down.
Airbnb (NASDAQ:ABNB) more than doubled on its opening day of trade. At 51.32 shares offered, it already has positive ratings from Wall Street firm Atlantic Equities and D.A. Davidson. These firms are hardly as reputable as that of Goldman Sachs or JP Morgan. Still, the upbeat report assisted in ABNB’s spectacular performance.
Investors who experienced the Y2K bubble in 1999 will know these are trading stocks. Get out of them if they correct to the downside. For now, trading them on the way up will earn easy profits.
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