The 180-day lockup period for Americold Realty Trust (COLD) ends on July 18, 2018. When this six-month period ends, the company's pre-IPO shareholders will have the opportunity to sell their 109 million currently restricted shares. With just 45.3 million shares currently trading pursuant to the IPO, the potential for a sudden increase in the volume of shares traded on the secondary market when the lockup expires is significant. Significant sales of these currently-restricted shares could negatively impact the stock price of COLD.

(Source: S-11/A)

Currently, COLD trades in the $22 to $23 range. COLD has a return from IPO of 38.8%. Shares of Americold Realty Trust had a first-day return of 11.1%. The shares climbed steadily to reach $22.30 on May 11 and dropped to $20.60 by May 31.

Business Overview: Owner of Temperature-Controlled Warehouses

Americold is the largest owner of temperature-controlled warehouses in the U.S. and internationally. The company owns and operates 158 warehouses with close to 934 million cubic feet of temperature-controlled storage in the United States, Canada, New Zealand, and Australia. Their warehouses are a critical link in the supply chain that connects food producers, distributors, processors, and retailers to consumers.

(Source: COLD website)

The company uses a strategy of owning rather than leasing property for its warehouses, and it believes its business benefits from the tax advantages afforded to REITs. Americold also uses this strategy to make value-added improvements to its properties that benefit its clientele without the need for a lengthy approval process from third parties.

Americold has approximately 2,400 clients. The company keeps its headquarters in Atlanta, Georgia, and has approximately 11,000 employees worldwide.

Business overview was sourced from the firm's S-11/A.

Financial Highlights

For the fiscal year ended December 31, 2017, Americold reported the following financial results:

• Revenue increased 3.6% to $1.54 billion. The Global Warehouse revenue grew 6.0% to $1.15 billion, when compared to the previous year.
• Total contribution increased 8.2% to $374.1 million. The Global Warehouse contribution was up 10.9% to $348.3 million over the previous year.
• Net loss was $0.6 million in contrast to net income of $4.9 million for the previous year.
• Core EBITDA of $287.1 million, an increase of 9.9% over prior year.
• Global Warehouse same store revenue grew 6.1% for a total of $1.12 billion.

Financial highlights were sourced from the firm's website.

Management Team

President and CEO Fred Boehler originally joined Americold in 2013. He was promoted to his current positions in December 2015. His previous experience comes from positions at SUPERVALU and Newell Rubbermaid. Mr. Boehler earned a bachelor's degree from Wright State University and a master's degree in International Business from Northern Illinois University.

EVP and CFO Marc Smernoff has served in his position since 2013. His previous experience comes from positions held at KPMG, Wells Fargo Securities, and Ernst & Young. He earned a bachelor's degree from University of California, Santa Barbara, and an MBA from UCLA Anderson School of Management. Mr. Smernoff is a Certified Public Accountant.

Competition: United States Cold Storage, Preferred Freezer Services and Others

Americold may be the largest operator of temperature-controlled warehouses globally, but the company does face competition from Swire Cold Storage, PolarCold, AGRO Merchant Group, Henningsen Cold Storage, Preferred Freezer Services, United States Cold Storage, and Lineage Logistics.

Early Market Performance

The underwriters for Americold Realty Trust priced its IPO at $16 per share, at the high-end of its expected price range of $14 to $16. Its six-month performance on the NYSE has been a steady climb. The stock closed on its first day of trading at $17.77 and then rose to a high of $22.30 on May 11.

Conclusion

When the COLD IPO lockup period expires on July 18th, pre-IPO shareholders and company insiders will be able to sell large blocks of currently-restricted stock for the first time. We believe that they will be motivated to do so - COLD has a return from IPO of 38.8%. With just 45.3 million shares of COLD trading pursuant to the firm's IPO, sales of the 109 million currently-restricted shares could flood the secondary market and cause a sharp, short-term drop in share price.

Aggressive, risk-tolerant investors should short shares ahead of the July 18th lockup expiration. Interested investors should cover these short positions during the July 19th trading session.