Luckin leaves bitter aftertaste, now trading below IPO price
The Chinese Coffee chain successfully completed its highly anticipated offering roughly a week ago, raising more than $550 million after pricing at $17 per share, the high end of its $15-$17 per share range.
Luckin was met with a warm reception from the markets, with the stock skyrocketing roughly 20% to a greater than $5 billion market cap in its first day of trading. However, concerns over the company’s lofty valuation, major cash burn and uncertain path to profitability have caused the stock to nosedive since.
Luckin has dropped around 25% since closing its debut trading day at $20.38 per share, and 40% from its intraday peak of $25.96. As of Friday’s open, Luckin stock sat at $15.44, now well below its IPO price.
Leading into the IPO, Luckin had already been the topic of much debate. Luckin had filed for its public offering just a year and a half after its founding. And prior to its filing, Luckin had raised more than $500 million in venture capital through four fundraising