Zillow Plummets In IPO debut, Yet Reported As 'Soaring'


By Patrick   Follow   Wed, 20 Jul 2011, 5:19pm   5,445 views   7 comments
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Zillow plummeted from $60/share down to about $36/share at the end of the trading day:

Yet this was strangely reported as "soaring":

http://www.thefiscaltimes.com/Articles/2011/07/20/Real-Estate-Website-Zillow-Soars-in-IPO-Debut.aspx?source=patrick.net#bodyContent

The explanation given is that this was much higher than the theoretical IPO price of $20, but neither you, me, nor anyone in the general public ever had a chance buy it at $20/share. According to that Yahoo graph, the first price any of us could have got it for was about $46, and it would have been a horrible loss for a single day.

http://caps.fool.com/Blogs/fades-of-the-day/617033 has this more honest assesment:

The stock was originally priced at $20.00 a share, however, the stock opened at $60.00 a share. The shares of Zillow stock plummeted as investors took profits right away when the stock began trading at 10:30 am EST.

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  1. HousingWatcher


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    1   6:36pm Wed 20 Jul 2011   Share   Quote   Permalink   Like   Dislike  

    The article says that ZIllow "soared."

  2. bill


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    2   9:46pm Wed 20 Jul 2011   Share   Quote   Permalink   Like   Dislike  

    You are so right. The only people who get the $20 price are the super-insiders and very preferred customers of the brokerage houses that issue the shares. However, Zillow seems a lot more real to me than Facebook. Look what happened to Myspace...

    Maybe Google+ will be the new "king of the hill?!"

  3. darrellsimon


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    3   8:31am Thu 21 Jul 2011   Share   Quote   Permalink   Like   Dislike  

    Good catch Patrick, this is very amusing indeed. Zillow and Trulia, fantastic as they might be are essentially useless for any real professional real estate work. Yes its the MLS Nars monopoly problem....

    Wanna know why Zillow will never fly too high? Craigslist is more useful as a real estate tool.... with craigslist one can actually do a pretty good comp analysis on rentals.

  4. Cautious1


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    4   8:45am Thu 21 Jul 2011   Share   Quote   Permalink   Like   Dislike  

    After reading the article with its positive diction ("Zillow Soars," "shares have doubled," "investors are bidding up Zillow Inc. stock," "Zillow had risen to $38.80 after trading as high as $60,"), I can only conclude it is Opposite Day. The chart above was flipped, and 4 pm is actually 10 am. Remember, Albert Einstein said that a man doesn't fall off a roof, he stays in place while the earth rushes up to meet him.

    Glad I could clear that up for you.

  5. sean7825


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    5   9:17am Thu 21 Jul 2011   Share   Quote   Permalink   Like   Dislike  

    I doubt anyone at Zillow is disappointed about a $36 close. At nearly double the offering price I think it is fair to say that it "soared". Actually when you compare their market cap at the close to LPS or CoreLogic I think it is safe to say that they "sky rocketed"... a veritable moon shot. Regardless of what happens to the stock price from here they now have a significant war chest that insures their presence for years to come.

  6. sfbubblebuyer


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    6   9:55am Thu 21 Jul 2011   Share   Quote   Permalink   Like   Dislike  

    They SHOULD be disappointed. They could have IPO'd at 36 bucks and made twice as much money.

  7. Done!


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    7   11:27am Thu 21 Jul 2011   Share   Quote   Permalink   Like   Dislike  

    It must have been a glitch.

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