Worst IPOs of 2009: Biggest Stock Flops
Vitacost.com (VITC), an online retailer that sells health and wellness products, priced 11 million shares of common stock at $12 each, in the middle of its expected range.
However, since it began trading on Sept. 24, the stock has tumbled 29% to close at $8.50 on Dec. 8.
In the past four years, Vitacost's sales have grown by an average of 48%, according to Morningstar, while its operating margin improved to 13% in the first quarter of 2008 compared with just 2% in the year prior.Still, investors worry about Vitascost's long-term prospects. "We think larger companies like Amazon (AMZN), Drugstore.com (DSCM) and GNC can use their scale advantages to offer lower prices in the long run," Morningstar wrote in a note.
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