Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Why Blyth's Shares Got Crushed

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of home fragrance direct seller Blyth (NYSE: BTH  ) were stinking it up today, falling as much as 23% in intraday trading after its ViSalus subsidiary announced the withdrawal of its initial public offering.

So what: The plan had been for ViSalus to sell up to $175 million of stock in an IPO and Blyth, which owns 73% of ViSalus, would turn around and pay its shareholders a nice special dividend. Now, if that's still going to happen, it's going to happen at some unknown time in the future. Citing "uncertain market conditions," ViSalus pulled the IPO today.

Now what: Investors may have reason to be upset simply because they're not going to get that special dividend -- the August announcement of that payout caused Blyth's stock to climb 17%.

But I can't help wondering whether there's more to be concerned about here. It's true that this isn't an ideal time for IPOs. However, not only are IPOs getting done, but some -- like Kayak (Nasdaq: KYAK  ) and, more recently, Trulia (Nasdaq: TRLA  ) -- are even getting priced above the expected offering range. The worry, then, is that despite ViSalus' 450% first-half 2012 revenue growth, institutional investors don't see the company worth as much as Blyth and ViSalus insiders do.

To be sure, it's tough to keep a good company down, and if ViSalus keeps growing like that, it'll become very difficult for the IPO market to pooh-pooh it. However, current Blyth investors may want to revisit their assumptions about how much ViSalus is worth.

Want to keep up to date on Blyth? Add it to your Watchlist.

Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Matt Koppenheffer has no financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter, @KoppTheFool, or on Facebook. The Fool’s disclosure policy prefers dividends over a sharp stick in the eye.

Read/Post Comments (1) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On September 26, 2012, at 10:23 PM, philsie1 wrote:

    Vacuous and lacking in depth, typical MF of late. Why even bother?

    The special div is only to pre-ipo holders, ie Blyth but not holders of BTH, and to senior Visalus folks.

    Plus, BTH owes $270mil or greater in performance payments to Vi by April of next year.

    The CC today was the biggest load of crap ever in s CC. Did you at least listen to that before cranking out this article?

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2033072, ~/Articles/ArticleHandler.aspx, 10/26/2016 8:07:36 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 10 hours ago Sponsored by:
DOW 18,169.27 -53.76 -0.30%
S&P 500 2,143.16 -8.17 -0.38%
NASD 5,283.40 -26.43 -0.50%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

12/31/1969 7:00 PM
BTH.DL $0.00 Down +0.00 +0.00%
Blyth CAPS Rating: **
KYAK.DL $0.00 Down +0.00 +0.00%
Kayak Software CAPS Rating: *