Aramco IPO

The world’s most profitable company plans to do the world’s biggest IPO in early December. The giant delayed its official announcement of a rekindled IPO as it waited for its third-quarter results, and recovered from the attacks in its oil facilities. 

It’s expected that the shares will be priced in early December and begin trading on the Riyadh-based Tadawul exchange on the 11th of December. 

Aramco’s market cap has been a concern for the Saudi prince, who isn’t willing to budge on the $2 trillion mark for the firm. I mean Aramco made $111 billion last year, and a 20x multiple of earnings isn’t really that astounding, but still, its in the trillions. It’s presently unclear about the price at which the IPO will happen, but I do think there’s a cautionary tale in place when it comes to gunning for high stakes IPOs. WeWork, Uber, Lyft, Fitbit are the nightmares that prevent bankers from sleeping peacefully at night.

Grub ($GRUB) Stuff

Shares of the food delivery company lost 40% of their value in a single trading day, with the stock closing at $33.11.

$GRUB reported revenue of $322.10 million, well below analysts’ estimates of $330.50 million, and a net income of $1.01, a 95.56% drop from $22.75 million in the third quarter of 2018.

The company reported earnings today and was just shy of meeting analyst expectations. What shot the stock down, however, wasn’t just relatively poor performance with regard to expectations, but the firm lowering its guidance for the upcoming quarter. 

GrubHub has more than one competitor, all of whom have deep pockets. From DoorDash to Uber Eats, the food delivery space is becoming more competitive by the day. However, GrubHub still boasts a first-mover advantage that has set in place formal contracts with a partnered set of restaurants as opposed just offering a courier service for food. Moreover, GrubHub is profitable, which is a lot more than one can say for its competitors who are currently bathing in venture money. 

Trading Tracker*

I haven’t put in a position yet this week, because I think the market might currently be too hot, but I might be doubling down on my $VIX calls tomorrow given that the market closed today with low volatility and we have the Fed announcement and the impeachment vote this week. 

Moreover, some big firms are set to release their earnings this week, including Apple, Facebook, Starbucks, Pinterest, and Alibaba. 

HBO also recently announced that HBO max will be priced at $14.99, and I imagine this news will affect $NFLX and $AAPL. $AAPL stock is one to watch out for as they report earnings tomorrow and launch their streaming service in a few days.