Box Inc, a cloud storage company founded in 2005, had its IPO this morning and shares surged soon after the debut. Just a few minutes into the IPO, the stock (with the appropriate ticker of BOX) gained well over 50% of its original price of $14/share. The stock also peaked with a gain of about 76%, and is currently experiencing resistance close to $24/share.
Apple’s very own Tim Cook had this to say about the company’s IPO:
Receiving recognition from the head of Apple (AAPL - Analyst Report) isn’t too bad for a first day’s work. Not to mention the massive stock surge, of course.
BOX IPO in Focus
The company sold 12.5 million shares for $175 million in its initial public offering. Box Inc. looks to use part of the funds from the sale of shares to reach more potential customers through sales and marketing.
Most of Box’s customers are businesses, as opposed to individual customers. An overwhelmingly large majority of Box customers are those in the Fortune 500 group, so it will be important for BOX to continue to grow its base in this segment.
Despite the positive news, it is important to note that the company doesn’t make a profit. This is primarily due to the losses incurred because of sales and marketing expenses. Hopefully Box inc. can use the capital to surge to profitability in the near term and make its business more efficient.
Either way though, this kicks off what looks to be a very exciting year for the IPO market as a number of popular companies from Uber to Pinterest are expected to make their debuts at some point later this year. Hopefully, those can see the same type of first day pop that we saw right out of the gate for the newly public BOX.
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