GoPro IPO on Loyal 3

Matt

Matt

Administrator
Staff member
I wouldn't advise touching an IPO until you have at least 1m in disposable assets.

The problem with loyal3 is that making it accessible to people with lower assets just puts more not smart money for the smart money to collect.

I haven't reviewed the IPO but every single one I have seen involved over priced stocks that small investors get burned on. The lure of a huge payday gets people every time.

If you like GoPro as a company, and have money to invest then wait it out, let the big money slaughter it and buy in later on.

Just my opinion on IPOs
 
ushdadude

ushdadude

Level 2 Member
Matt said:
I wouldn't advise touching an IPO until you have at least 1m in disposable assets.

The problem with loyal3 is that making it accessible to people with lower assets just puts more not smart money for the smart money to collect.

I haven't reviewed the IPO but every single one I have seen involved over priced stocks that small investors get burned on. The lure of a huge payday gets people every time.

If you like GoPro as a company, and have money to invest then wait it out, let the big money slaughter it and buy in later on.

Just my opinion on IPOs
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just tell us when it's ready for picking:p
 
S

Spencer

Level 2 Member
This is a risky proposition but if you are trying to get into a hot IPO with a credit card, check out Loyal3.

I received an email from Loyal3 yesterday about the upcoming GoPro IPO. I am not sure how many GoPro IPO shares Loyal3 will actually distribute to us small retail investors, but it is worth a shot.

You can buy IPO's at Loyal3 with a credit card ($10K max), most of them are garbage, but many think the GoPro IPO will be a big winner (including me).

Here is one of my Loyal3 accounts set up for an $8K GoPro IPO reservation. Note that $350 will be applied toward your shares immediately. I have a $350 temp authorization on this Arrival as of yesterday:

06/11/2014GoPro$8,000.00 IPO reservation($350.00)
06/11/2014GoProFunds Transfer from Credit Card *****8386 for $8,000.00 IPO reservation

$350.00

GoPro will price between $21 and $24 in 13 days. In theory you could lose your entire investment so don't play with money you can't lose. But if you are an IPO investor this is a good way to MS.
 
S

Spencer

Level 2 Member
I just don't understand the risk aversion, this is not a buy and hold strategy. If you are lucky enough to receive shares from the subscription, you can sell them whenever you want. You will most likely be getting these shares at a deep discount to market open. The average IPO first day return in 2014 is 14%. There were tons of naysayers with the TWTR offering, also with strong individual investor following. Up 73% first day from IPO pricing. Zoes Kitchen in April 2014: +107 first day%, Coupons.com March 2014: +62%. No risk=no reward.
 
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Matt

Matt

Administrator
Staff member
Spencer said:
I just don't understand the risk aversion, this is not a buy and hold strategy. If you are lucky enough to receive shares from the subscription, you can sell them whenever you want. You will most likely be getting these shares at a deep discount to market open. The average IPO first day return in 2014 is 14%. There were tons of naysayers with the TWTR offering, also with strong individual investor following. Up 73% first day from IPO pricing. Zoes Kitchen in April 2014: +107 first day%, Coupons.com March 2014: +62%. No risk=no reward.
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Actually, when calculating risk and reward there is indeed a risk free rate of return, it is typically T Bills. Certainly not a lot of return, but in better line with the risk. I was first offered IPO action back in 2009 with Citi. In order to access them at the time they asked me for $100K in Fees. Not in AUM, fees...

Now they are letting people in with zero assets and just credit cards and you don't think this is a disaster waiting to happen?
 
ed1chandler

ed1chandler

Level 2 Member
If you're doing this because you're already an IPO investor, then this is really just "S", ... not "MS."
Nevertheless, this is awesome out of the box thinking. Thanks for sharing.
 
S

Spencer

Level 2 Member
Matt said:
Actually, when calculating risk and reward there is indeed a risk free rate of return, it is typically T Bills. Certainly not a lot of return, but in better line with the risk. I was first offered IPO action back in 2009 with Citi. In order to access them at the time they asked me for $100K in Fees. Not in AUM, fees...

Now they are letting people in with zero assets and just credit cards and you don't think this is a disaster waiting to happen?
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Overall, yes, a disaster. But the GoPro IPO, no.
 
Matt

Matt

Administrator
Staff member
Spencer said:
Overall, yes, a disaster. But the GoPro IPO, no.
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Could you share your analysis as to how this one specifically won't be a disaster? Leaving aside if you like the company or not. Just based upon pricing, book to value, subscription price that you will be offered at IPO, ability to exit trade via Loyal3 platform etc?
 
S

Spencer

Level 2 Member
Sure. I believe that in this market the projected $3B market cap is too low for a disruptive technology like GoPro. Note that I said "in this market". The market is greatly overvalued but there is nowhere else for cash to go. In the end individual investors will be left holding the bag as usual. In different times $3B for an untested company with one product would be ludicrous. But we are talking about an era in which a taxi cab company, Uber, is valued at $18B. Amazon and Netflix trade for 20x book value. Book value is meaningless for analysis of growth companies.

I think that the market agrees and will will blindly drive up the valuation on Day 1, similar to recent IPO's. It will price above the range, probably $26+. I do not believe that Loyal3 will distribute many shares, and that this is basically a big publicity stunt to gain new Loyal3 customers. If I get 100 shares I will be pleasantly surprised. I would try to get IPO shares from Loyal3 or any other brokerage that would sell them to me at IPO price. I would sell Day 1 at Loyal3's batch price.

If I lose, I lose. I am a turtle trader. Get in and ride the trend, get out when it changes. Keep emotions low. IPO's do not fit my investing strategy but I think this one is a winner.

As an aside, I did MS $22K/month through Loyal3 when it was $2,500 credit card limit. Lost an average of $70 per month total on low beta stocks BRK-B, HSY, MCD, etc. But the loss bought $440/mo in travel on Arrival.
 
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Matt

Matt

Administrator
Staff member
Spencer said:
Sure. I believe that in this market the projected $3B market cap is too low for a disruptive technology like GoPro. Note that I said "in this market". The market is greatly overvalued but there is nowhere else for cash to go. In the end individual investors will be left holding the bag as usual. In different times $3B for an untested company with one product would be ludicrous. But we are talking about an era in which a taxi cab company, Uber, is valued at $18B. Amazon and Netflix trade for 20x book value. Book value is meaningless for analysis of growth companies.

I think that the market agrees and will will blindly drive up the valuation on Day 1, similar to recent IPO's. It will price above the range, probably $26+. I do not believe that Loyal3 will distribute many shares, and that this is basically a big publicity stunt to gain new Loyal3 customers. If I get 100 shares I will be pleasantly surprised. I would try to get IPO shares from Loyal3 or any other brokerage that would sell them to me at IPO price. I would sell Day 1 at Loyal3's batch price.

If I lose, I lose. I am a turtle trader. Get in and ride the trend, get out when it changes. Keep emotions low. IPO's do not fit my investing strategy but I think this one is a winner.

As an aside, I did MS $22K/month through Loyal3 when it was $2,500 credit card limit. Lost an average of $70 per month total on low beta stocks BRK-B, HSY, MCD, etc. But the loss bought $440/mo in travel on Arrival.
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OK, well I'm not your mother, so I can't tell you what to do, but I hope that anyone who tries this is doing it with money they can afford to lose and not just manufacturing spend. I also wish you the best of luck with it. Despite the IPO not being advisable I do want you to get incredibly rich and hope this helps that.
 
Y

yuneeq

Level 2 Member
Spencer said:
I do not believe that Loyal3 will distribute many shares, and that this is basically a big publicity stunt to gain new Loyal3 customers. If I get 100 shares I will be pleasantly surprised. I would try to get IPO shares from Loyal3 or any other brokerage that would sell them to me at IPO price. I would sell Day 1 at Loyal3's batch price.
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Loyal3 is underwriting 1.5% of GoPro's shares, according to the prospectus. That amounts to 133,500 shares. At the low end of $21 a share, they are selling 2.8mm worth, good for 280 investors at 10k. Or at $26 a share, 3.47mm, good for 347 investors at 10k a piece.
 
sriki

sriki

Level 2 Member
Good thing I searched the forum before posting. Whew.

I had setup my loyal3 GoPro IPO for $3000. This morming, I got an email that I got allotted only $350 worth of stock which has a little disappointing but this is my first IPO (after missing facebook). How much did you get assigned?
 
Matt

Matt

Administrator
Staff member
Final price was $24. I signed up for this (as much as I don't advise it...) so I could research the process, asked for $5K and they allotted me $500. I was under the impression that there would be a 'decision window' where I would get the chance to opt out of the shares, but I never really saw the opportunity to do so and I bought in at the $24 level.

Price at close was $31.34 so about 30% daily gain.

Highly unadvised...
 
I

incendia

Level 2 Member
Matt said:
Final price was $24. I signed up for this (as much as I don't advise it...) so I could research the process, asked for $5K and they allotted me $500. I was under the impression that there would be a 'decision window' where I would get the chance to opt out of the shares, but I never really saw the opportunity to do so and I bought in at the $24 level.

Price at close was $31.34 so about 30% daily gain.

Highly unadvised...
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The window is if the price is outside the original range, in this case it was at the high end of the range.
 
sriki

sriki

Level 2 Member
I think you can still back out if its within the price range they mentioned. It probably is not available online (call in only)
 
Matt

Matt

Administrator
Staff member
sriki said:
I think you can still back out if its within the price range they mentioned. It probably is not available online (call in only)
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I'm kinda busy this week, so I may not of tracked it properly, but I feel that the announcement and updates came rather early (for me) which is a little awkward to back out of. I have to say I didn't love the way it went down, i'll be out tomorrow at whatever rate the market offers at noon, and will stick with Loyal3 for the monthly drip into Apple and Berkshire.
 
I

incendia

Level 2 Member
Matt said:
I'm kinda busy this week, so I may not of tracked it properly, but I feel that the announcement and updates came rather early (for me) which is a little awkward to back out of. I have to say I didn't love the way it went down, i'll be out tomorrow at whatever rate the market offers at noon, and will stick with Loyal3 for the monthly drip into Apple and Berkshire.
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If you give the sell order now at 9am or noon it shouldn't make a difference because they batch buy and sell, or am I missing something?
 
Matt

Matt

Administrator
Staff member
incendia said:
If you give the sell order now at 9am or noon it shouldn't make a difference because they batch buy and sell, or am I missing something?
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That's correct- my comment was direct towards the buy side of the equation- I was expecting a clearer opt in rather than what happened.

I put the sell order in last night and it will batch at noon today.
 
I

incendia

Level 2 Member
Matt said:
That's correct- my comment was direct towards the buy side of the equation- I was expecting a clearer opt in rather than what happened.

I put the sell order in last night and it will batch at noon today.
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I thought they batched at ~2:30ET
 
Matt

Matt

Administrator
Staff member
incendia said:
I thought they batched at ~2:30ET
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Perhaps- frankly it's not something I'm watching that closely. In hindsight selling was dumb too, but I just wanted simplicity.

I'm sure they will be sold at some point today, providing the market stays open :)
 
tjs198

tjs198

Level 2 Member
Was toying with buying the GoPro IPO when Matt's post came out, but never jumped in. Funny thing is I'm interested in a GoPro camera now, anyone know when the new version 4 comes out? I also just started the Loyal3 - Berkshire $50/month investment. Anyone else profit? I see matt did very well after a day
 
Matt

Matt

Administrator
Staff member
tjs198 said:
Was toying with buying the GoPro IPO when Matt's post came out, but never jumped in. Funny thing is I'm interested in a GoPro camera now, anyone know when the new version 4 comes out? I also just started the Loyal3 - Berkshire $50/month investment. Anyone else profit? I see matt did very well after a day
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I did ok, but I only bought in so I could review them for the blog (I've already reviewed loyal3 but wanted to explore their IPO execution)

I wouldn't recommend doing what I did.

As for the camera, not sure, but I would imagine one is due soon, they typically release new technology the day after I buy the old one.
 
sriki

sriki

Level 2 Member
I did the GoPro IPO through loyal3. I made a 50% profit on a one day investment, though my allotment is very small. I have a few stock on auto buy for 50$ every month. That's a form of investment for me. I will probably get out of the market soon though.
 
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