LifeLock shares price at $9.00, which was already under the $9.50 to $11.50 expected price range from the underwriters. Shares have an official post-IPO high of $9.04 but the debut trading day closed at $8.36. Now shares are down almost 4% more at $8.04 on the day.
One additional negative here is a Seeking Alpha article detailed more of the same observation we had on the matter. The company’s promotional expenses are off the chart at 46% of revenues. It also showed that the company is spending 18 months of revenues to acquire each new customer and customer acquisition costs are rising faster than revenues.
The market has voted that LifeLock is a maturing or less valuable business model than what the company is trying to represent. Its ad and marketing budget pretty much speaks for itself. When shares were still private we saw that some expected valuations were close to $1 billion for this identity protection service. Based upon a prospectus share count of 83,379,068 common shares, the market cap is closer to $760 million now.
JON C. OGG
The Average American Is Losing Their Savings Every Day (Sponsor)
If you’re like many Americans and keep your money ‘safe’ in a checking or savings account, think again. The average yield on a savings account is a paltry .4% today, and inflation is much higher. Checking accounts are even worse.
Every day you don’t move to a high-yield savings account that beats inflation, you lose more and more value.
But there is good news. To win qualified customers, some accounts are paying 9-10x this national average. That’s an incredible way to keep your money safe, and get paid at the same time. Our top pick for high yield savings accounts includes other one time cash bonuses, and is FDIC insured.
Click here to see how much more you could be earning on your savings today. It takes just a few minutes and your money could be working for you.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
