You couldn't get much more different than the two deals coming off of lockup expirations this week. One,
, is an ice-cold investment for restricted shareholders, while the other,
, is red-hot.
Briazz makes and sells breakfasts and lunches for people on the go, and was introduced to the public markets on May 2. The company priced 2 million shares at $8, the bottom of the expected price range. The first day of trading was uneventful, with Briazz seeing a first-day premium of only 0.37%. Since then, the stock has seen little daylight and very little interest. As of Wednesday morning, Briazz was trading at slightly more than a buck, or about 88% less than the issue price, with a trading volume of 3,000 shares.
Maintaining a close eye on trading volume will serve you well when following lockup expirations. The highest trading volume day the stock has seen was June 29, when volume soared to more than 600,000 shares and the stock fell $1.69, a hefty chunk for one trading under $5. Briazz is scheduled to report earnings Nov. 9.
The other name on the list, Simplex Solutions, boasts a much better track record on the brink of its lockup expiration. Falling in line with other chip companies like
, Simplex Solutions soared 77% on its first day of trading, the biggest first-day gain for an IPO this year.
The company wound up bringing home $44.6 million after underwriting discounts and commissions, a healthy sum in a relatively stagnant IPO market. Better yet, Simplex Solutions is still trading well above its IPO price, closing on Tuesday at $16.79, still more than 35% above the issue price.
Now, let's take a closer look at the historical trading volume for Simplex. In the past, Simplex has performed well on high-volume days. On June 1, trading volume was more than 320,000 shares, and the stock shot up 4.2 points. On the next trading day, June 4, the volume skyrocketed to more than 3 million shares and the stock soared 10.2 points.
The stock began to lose ground in the following days, but the fact that it went up in heavy volume indicates that there was significant interest. Be on the lookout for buyers on the sideline if the stock sinks drastically. The company's earnings report comes out Oct. 23.
Keep in mind that the key factor to this equation is heavy trading volume. If there are no sellers, there is no game.
Here's the list for this week:
Michael Falbo is an analyst for
ipoPros.com, a Boulder, Colo.-based research boutique (now a wholly-owned subsidiary of TheStreet.com) specializing in the analysis of equity syndicate offerings. This column is not meant as investment advice; it is instead meant to provide insight into the methods of new and secondary offerings. Neither Falbo nor his firm has entered indications of interest in any of the companies discussed in this column. This Week in IPOs column appears Sundays, This Week's Secondaries appears Tuesdays, Upcoming Lockup Expirations appears Wednesdays and The Quiet Period appears on Fridays. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Falbo appreciates your feedback at