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SoftBank-backed Lemonade jumps 86% in U.S. debut

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Markets summary

The Maltese market closed in the red on Thursday with the MSE total index ending the session 0.212% lower at 8,306.078 points. The best performer was Bank of Valletta plc, by adding 1.50% to close at 1.015, followed by 1.27% increase of Simonds Farsons Cisk plc with a closing price of 8.00. The biggest fall was seen from Mapfre Middlesea plc, 9.09% drop to 2.00, followed by 2.04% slid of BMIT Technologies plc with a closing price of 0.48. HSBC Bank Malta plc, Malta International Airport plc and PG plc were active but closed unchanged.

European stocks finished sharply higher following the release of better-than-expected US non-farm payrolls figures for June. By the end of trading the benchmark Stoxx 600 had put on 1.97% to 368.29. The German Dax jumped by 2.84% alongside to reach 12,608.46 while the FTSE Mibtel added 2.88% to 19,886.88.

Wall Street stocks closed higher on Thursday as market participants digested a slew of data from the Department of Labor and some positive news regarding a coronavirus vaccine candidate. At the close, the Dow Jones Industrial Average was up 0.36% at 25,827.36, while the S&P 500 was 0.45% firmer at 3,130.01 and the Nasdaq Composite saw out the session 0.52% stronger at 10,207.63.

SoftBank-backed Lemonade jumps 86% in US$319M U.S. debut

Lemonade Inc., the online home insurance provider backed by SoftBank Group Corp., jumped as much as 86% after raising USD 319 million in its U.S. initial public offering.

Shares of the company opened at USD 50.06 and rose as high as USD 53.96 in New York trading Thursday. It sold 11 million shares at USD 29 a piece on Wednesday after marketing them at USD 26 to USD 28 each.

Lemonade was trading at USD 53.36 at 11:45 a.m., giving it a market value of about USD 2.9 billion, based on its number of outstanding shares.

Lemonade has been unprofitable since its inception in 2015 and it reported a USD 36.5 million net loss in the three months ended March 31 compared to a net loss of USD 21.6 million during the same period last year. Its sales have more than doubled in that period.

SoftBank led a USD 300 million funding round in Lemonade last year, valuing the company at USD 2.1 billion at the time, and it will own a 21.8% stake in the company upon the IPO.

Goldman Sachs Group Inc., Morgan Stanley, Allen & Co. and Barclays Plc led the offering and Citadel Securities was designated market maker for the listing.

This article was issued by Nadiia Grech, Junior Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article are being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investment Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.