initial public offerings (IPOs) trading on American exchanges

Saturday, August 23, 2014

Jumei (JMEI) dives after Q2 earnings

China's Jumei International (NYSE:JMEI) illustrated the risks that high-flying IPOs often bear. The recent new issue on Tuesday posted its biggest single-day drop since June 12, following its report of second-quarter results after Monday's close.

Earnings per share minus items rose 23% to 16 cents and beat views by 4 cents. But after-tax margin slimmed to 14% vs. 14.5% in the year-ago quarter.

The online retailer of beauty products said Q2 revenue rose 42% from the year-earlier quarter to $154.4 million, beating the consensus by $4.8 million, as polled by Thomson Reuters. Active customers in Q2 rose 43% to 5 million. Total orders rose 39% to 11 million.

Jumei debuted May 16, priced at 22 and raised $425 million. Including all share classes, the company has a market value of $4.8 billion.

Before reporting Q2 earnings late Monday, Jumei stock hit an all-time high of 39.45, up 59% from its IPO pricing. But on Tuesday, shares dived 4 points, or 11%, to 33.10 in nearly quadruple average volume. The stock has an average daily volume of 1.14 million shares, which is ample.

Jumei had cleared a 31.70 cup-with-handle buy point on Aug. 7 and muscled nearly 20% higher in the six sessions. But the stock made a negative reversal ahead of Monday's report, off 2% to 37.10.

For 2014, the company expects earnings minus items of $81 million to $87 million, up 40% to 50%.

Jumei is part of the Retail-Internet group, which has rallied within IBD's daily rankings of 197 industry groups and subgroups in recent weeks. As of Tuesday's IBD, the group ranked 60th for six-month relative price performance, up from 94th six weeks ago. The group is led by Vipshop (NYSE:VIPS) and (NYSE:WUBA), which hold Composite ranks of 99 and 98, respectively.

No comments:

Post a Comment