(Bloomberg) -- Poshmark Inc.'s sliding stock performance since its stunning debut may see a reversal if the banks that underwrote its initial public offering issue bullish analyst ratings on Monday when a quiet period ends.
The company's stock has shed roughly a third of its 142% pop on the first day of trading in January. At the time, it was one of the best debuts of the past year, extending a hot streak of IPOs. But with the shares in decline since then, investors will be eager to see if underwriting banks, which tend to be more positive, defend the company.
Poshmark, an online marketplace of secondhand goods, raised $277 million in the IPO after it priced shares at $42, above the marketed range of $35-$39. Underwriters subject to the quiet period include Morgan Stanley, Barclays Bank, Cowen, Goldman Sachs, JMP Securities, Raymond James, Stifel and William Blair.
Earlier this week, MKM Partners, a bank not subject to the quiet period, initiated coverage with a buy rating. Unlike peers Thredup and The RealReal, Poshmark is the only online marketplace without inventory ownership, which allows for lower operating expenses and fewer challenges, analyst Roxanne Meyer wrote. It's “the most seamless path to profitability,” she said.
Its other strengths include its community, proprietary technology, “visionary” leadership and sustainability, which is important to Gen Z and Millennials, Meyer said. Her price target on the stock is $88, about 31% above Thursday's close.
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