Eutelsat
After its first five trading days, Eutelsat finds its stock trading above the 12-euro ($14.16) initial public offering (IPO).
The stock fell below its IPO price on its opening day Dec. 2 and continued to drop throughout the next two trading days. Eutelsat matched its IPO price Dec. 7 and climbed to 12.36 euros ($14.59) the following day. Given that the stock suffered only a slight drop below its IPO price before rising, it would appear that investors agree with Eutelsat on the valuation of the stock.
In comparison with the three major satellite operators that launched IPOs this year — Panamsat (March 17), New Skies (May 10) and Inmarsat (June 20) — Eutelsat should be satisfied with its early performance. Of those three, only New Skies was able to close above its IPO price ($16.50) on its first day of trading. It took Panamsat 33 trading days to close at its IPO price of $18 and Inmarsat four trading days to close above the 2.85 pounds ($5) it opened at on its first day of trading.
LORL
New shares of Loral Space & Communications Inc. began trading Dec. 8 on the Nasdaq exchange as part of the company’s bankruptcy reorganization. The company issued 18.7 million shares, or about 94 percent of the 20 million new shares of Loral, while its Loral Skynet unit issued 987,000 shares of preferred stock, representing about 99 percent of the new shares of preferred stock issued. The balance of stock is being held in reserve pending the resolution of outstanding claims against Loral.
Loral shares opened Dec. 8 at $30 and climbed as high as $30.41 during the first day of trading before closing the day at $28.61. The closing price also was less than the Dec. 7 closing price of $29.10 for Loral stock on the over-the-counter market under the ticker LRALV. Those shares have been canceled by Loral.
WSRP
It looks as though things might be starting to turn around for satellite radio service provider Worldspace. The company’s stock, which has been trading well below its IPO price of $21 since the company went public Aug. 4, ended the review period for this issue on a rally, driven by Worldspace hitting 100,000 subscribers.
“Reaching 100,000 subscribers is an important milestone for Worldspace, and it reflects the effective implementation of our strategic plan, which is to leverage attractive market opportunities for our subscription service,” Worldspace CEO Noah Samara said in a statement.
On Dec. 7, the day the milestone announcement was released, Worldspace shares jumped 60 cents to close at $11.78. The upward momentum carried to the next trading day, with shares closing at $12.25.
While the news is good for Worldspace, we expect the stock to linger below the IPO price for a while longer. If Worldspace can demonstrate an ability to pick up its next 100,000 subscribers faster than the more than six years it took to hit the first 100,000 subscribers, investor interest should pick up, which should in turn help drive the value of the stock.
