Smart for Life (SMFL) stock tanks on debut. What's next for investors?

Published on February 17, 2022 03:08 AM EST

Smart for Life (SMFL) stock tanks on debut. What's next for investors? — Image source: © Pookpiik | Megapixl.com

Highlights:

On Wednesday, February 16, Smart for Life announced the pricing of its shares and went public in the US equities market.

SMFL stock began trading on the Nasdaq Capital Market and tanked on debut.

Smart for Life is a marketer and manufacturer of nutritional products, and it received approval to list its shares on February 16.

Since the beginning of this year, the equities markets have remained volatile, and it appears to be affecting the initial public offering (IPO) plans of companies.

So far, IPOs have received a mixed response from investors as some remained skeptical due to market conditions. Meanwhile, few private companies delayed their public debut plans, probably to avoid an unsuccessful start in an equity market.

On February 4, it was reported that Ebanx, a financial technology (fintech) firm delayed its IPO plan. Notably, Ebanx's services have been used by companies like Amazon, Uber, and Spotify.

Also Read: Is Mark Cuban Cost Plus Drug Company IPO happening?

Meanwhile, an HR software company postponed its IPO plans in January, citing market conditions. Due to the Federal Reserve's uncertainty over interest rates hikes, markets have witnessed increased volatility.

What happened with Smart for Life (NASDAQ:SMFL) stock?

On Wednesday, February 16, Smart for Life announced the pricing of its shares and went public in the US equities market. Notably, the company offered 1.4 million shares for gross proceeds of around US$ 14.4 million.

Smart for Life is a marketer and manufacturer of nutritional products, and it received approval to list its shares on the Nasdaq Capital Market.

The nutritional products marketer started trading under the stock symbol SMFL and began trading during midday on February 16.

The SMFL stock was priced at US$ 10 per share. However, it opened at US$ 3 apiece when the trading session began. During the day, it declined 70.2 per cent to US$ 2.68 per share.

Bottom line

As IPOs have received a mixed response, it is advisable for interested investors to remain cautious. Smart for Life aims to use the money raised from its public debut to pay off all debt.

In addition, the company could use the gross proceeds for general corporate purposes and working capital.

Smart for Life expects that through buy-and-build and acquisition strategies, the company could generate a minimum of US$ 300 million in revenues in the next three years.

The nutritional products company is engaged in developing proprietary products and acquiring profitable companies to drive growth and earnings.

Also Read: NVIDIA-SoftBank deal collapses. When is Arm IPO happening now?

Raza Naqvi

Author

Raza Naqvi - Financial Journalist
998 Posts
Raza comes from a hard-news background and is an experienced writer with a demonstrated history of working in reputed organizations like the United Nations, Indian Express, and Hindustan Times. Currently, he is exploring the financial world!...

Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Incorporated (Kalkine Media), Business Number: 720744275BC0001 and is available for personal and non-commercial use only. The advice given by Kalkine Media through its Content is general information only and it does not take into account the user’s personal investment objectives, financial situation and specific needs. Users should make their own enquiries about any investment and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media is not registered as an investment adviser in Canada under either the provincial or territorial Securities Acts. Some of the Content on this website may be sponsored/non-sponsored, as applicable, however, on the date of publication of any such Content, none of the employees and/or associates of Kalkine Media hold positions in any of the stocks covered by Kalkine Media through its Content. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used in the Content are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used in the Content unless stated otherwise. The images/music that may be used in the Content are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated or was found to be necessary.