YogaWorks (YOGA) has announced the purchase of 2 Tranquil Space yoga studios in the D.C. metro area; including their Dupont Circle location, which was named one of the Top 25 yoga studios in the world. YOGA will retain all Tranquil Space teachers/staff and continue to offer existing programming at both locations. The acquisition, which comes less than 30 days after the company’s $35 million IPO took place (Aug. 11), brings the yoga instruction company to 52 studios in 7 markets.
Fan Marino: The yoga market is growing. 20 million participated in 2012, 36 million practiced in 2016 and that number is expected to grow to 55 million by 2020.
Howie Long-Short: YOGA has gone from $13 in a preliminary offering to $5.50 at time of IPO to $3.80 at the time of print, with $2/share in cash. Why are revenues down if the yoga market is growing?
YogaWorks Expands East Coast Presence With Acquisition of Premier Studios in Virginia and Washington, D.C.
YogaWorks (YOGA) finally made its public debut, pricing 7.3 million shares at $5.50/per, while raising $40.2 million in the process. The company had previously tried and failed to sell 5 million shares at $12-14/per, citing “market conditions” while postponing its July 20th scheduled debut. While those bullish on YOGA cite a subscriber base that is 40% millennials and has 60% earning $75,000 or more, the nationwide yoga chain has posted net losses two years in a row. In the filing, the company which currently owns 50 studios, announced it is in deep negotiations on 14 more at a cost of $5-6 million.
YogaWorks (YOGA) Completes Its Discounted IPO, Raises $40.2 Million
Howie Long Short: “Market conditions” is code for lack of interest. In this case, the shares were simply overpriced.
Fan Marino: The company cited 30 million visits last year. If Millennials are making 12 million of those trips (40%), perhaps it isn’t avocado toast killing their chance of home ownership… Doesn’t anyone work anymore?!?
YogaWorks (YOGA), the boutique fitness studio chain, was scheduled for an IPO on the NASDAQ exchange Thursday, but chose to postpone citing “market conditions”. Valuation appears to be the issue here. At $13/share, the company would have had a public market cap of $187 Million, 3.4x its 2016 revenue, while not yet profitable. In fact, losses increased in 2016, up from $9.2 Million to $9.4 Million. No timeframe has been given on if/when the IPO will occur.
YogaWorks IPO pulled on valuation concerns, not market conditions
Howie Long-Short opines: Count this one as a win for retail investors, who were likely saved from future losses. Not so much for Stephens and the other second-tier bankers.
Fan Marino says: You can’t say Howie didn’t call this one.
YogaWorks, which owns and operates 50 yoga studios within 6 U.S. markets, has plans to raise $65 Million by offering 5 Million shares between $12-$14. The yoga chain, which plans to list on the NASDAQ Global Market under the symbol YOGA, is not currently profitable, losing $9.4 Million in 2016. Net Revenues however, are growing, and the company says it’s been deferring revenue by converting members from a subscription based to class pass model.
YOGAWORKS, A US YOGA STUDIO CHAIN, SETS TERMS FOR $65 MILLION IPO
Howie Long-Short opines: Dare I say it’s a stretch to call this a hot IPO? Oh God. Sorry. Really though, a yoga studio roll-up sounds even worse than a golf club roll-up (MYCC). This one smells.
Fan Marino says: I’m not convinced stretching can be considered a workout. If you have to crank up the heat to 95 degrees to work up a sweat, are you actually working up a sweat?