El Pollo Loco Holdings, Inc. (NASDAQ: LOCO) was on fire after the grilled chicken franchise came public. Its $15.00 per share initial public offering rose to $19 and then kept on going up, and up even further. Now it seems as though reality has started to set in.

This stock has only had fourteen trading sessions as of Wednesday. After peaking at $41.70 on August 1 and then peaking at $41.46 on August 4, things have gone south. 24/7 Wall St. had asked over the first weekend of August when El Pollo Loco shares would finally cool off. Perhaps by shear luck, they did so almost immediately.

This Monday we featured several hot IPOs which were trading higher in the secondary market. At that time, El Pollo Loco shares were up almost 1.5% at $37.46 and had been as high as $38.53 that morning – only to close at $35.79. Trading has not gone well since, with the stock now on its fourth consecutive day of losses.

With close to 60 minutes until the close, El Pollo Loco shares were down more than 1.4% at $33.57 in very dull trading  of only 1.45 million shares.

A concern that investors will have, which is actually not all that unusual, is that the trading volume has started to cool off handily. The first six trading sessions did not have fewer than 10 million shares trade on any day, but now the volume has slid down to what seems like a normalized rate of 2 million to 3 million shares – except for today’s  record low in trading volume for the stock.

Another consideration to make for now is that none of the underwriting firms have been able to initiate analyst coverage of this casual dining chain. That means that no firm can technically defend the stock with any serious authority. Jim Cramer did recently pan El Pollo Loco, for whatever that is worth.

Is El Pollo Loco going to be the next Chipotle or the next Potbelly? Regardless of the answer, what does seem pretty clear is that a lot was left on the table for its IPO pricing.

Stay tuned.

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