3 New Issues IPO Investors Need to Know About for This Week

Seven new companies will make their market debuts in the coming days. We take a look at an IT company, an Asian cosmetics purveyor, and an online car-buying service.

May 12, 2014 at 8:56AM

For the second week in a row, investors will be spoiled for choice in the IPO space. Between now and Friday, seven issues are slated to make their market debuts, and nearly all are poised to take in more than $50 million in proceeds. This week's new stocks are mixed not only in terms of sector, but also in nation of origin (one of our picks, Jumei International Holding, hails from China).

Before we turn the spotlight onto our selections, though, we need to emphasize that IPO investing carries above-average risk, as initial stock prices can be far from the value the market eventually puts on the company's shares. This provides great upside potential for the chosen stock, but it also carries the risk of losing the bulk of an investment.

And with that out of the way, let's take a look at our candidates for this week:

This IT company with a memorable name aims to provide a Zen-like sense of calm to its clients, who utilize the company's slate of software offerings that automate a range of customer service functions. Zendesk provides those solutions through a subscription model, and at the moment it says there are over 42,000 customer accounts on its customer service platform. As is expected of a young tech company, Zendesk has posted consistent losses, although it reduced last year's shortfall to $23 million from 2012's $33 million. Revenue, meanwhile, has advanced nicely, coming in at $25 million in Q1 of this year against $14 million in the same period of 2012.

Zendesk (ticker symbol: ZEN) is scheduled to hit the New York Stock Exchange on Thursday. Slightly more than 11.1 million shares of the company will be sold for $8 to $10 apiece in an issue lead-underwritten by Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS), and Credit Suisse (NYSE:CS).

Jumei International Holding
China is an immense market, so it's no small thing to claim to be the No. 1 online domestic retailer of beauty products, as Jumei International Holding does. According to the company's figures, it held around 22% of that market last year. That was enough to bring in net revenues of $483 million, more than double the 2012 tally. The company was also profitable both 2013 (to the tune of $25 million) and in the preceding year ($8.1 million).

The Chinese company will make its American market debut on Friday, with the sale of 9.5 million American Depositary Shares on the NYSE. The lead underwriters of the flotation are Goldman Sachs (Asia), Credit Suisse, and JPMorgan Chase (NYSE:JPM) unit J.P. Morgan, and the issue price is to be $19.50 to $21.50 per ADS. The ticker symbol will be JMEI.

As its name implies, this operator of a popular online auto-buying platform aims to provide its customers with the fairest price for a car. It's been in business since 2009, growing its top line at a strong clip since then. It hasn't managed to turn this into bottom-line profitability, but the eternal and unbreakable love affair between Americans and automobiles gives it a big, lucrative market to benefit from, as does the company's partner network of more than 7,700 "TrueCar Certified Dealers" throughout the country.  

Just under 7.8 million shares of TrueCar will make their way to the Nasdaq on Friday under the ticker symbol TRUE, priced at $12 to $14 per share. The lead underwriters are Goldman Sachs, J.P. Morgan, and Royal Bank of Canada's (NYSE:RY) RBC Capital Markets.

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Eric Volkman has no position in any stocks mentioned. The Motley Fool recommends Goldman Sachs, and owns shares of JPMorgan Chase. 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. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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