Sonos Incorporated is an audio company that sells speakers & other components- namely portable speakers, headphones, home audio systems etc. It’s kept up to date with modern tech trends such as wireless/Bluetooth connectivity, voice-enabled functions and internet connectivity.
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Sonos estimates net proceeds from sale of common stock to be approximately $90.5 million at an estimated price of $18/share (which is considered the mid-point of share price value estimates). These numbers come after deductions of underwriting discounts and offering expenses are paid.
Sonos leaves room for a $1 increase or decrease in share price, which could change net proceeds by $5.2 million in either direction — assuming number of shares offered does not change.
Sonos also leaves room for a 1.0 million increase or decrease in number of shares offered, which would change net proceeds by $16.9 million in either direction.
Purposes for offering include: obtaining additional capital, create a public market for private stock, facilitate future access to public equity markets, increase awareness of customers for the company, and improving competitive position.
Plans for net proceeds include: sales & marketing activities, research & development, and general/administrative expenditures. If there are leftover funds available, Sonos plans to use them for the acquisition of, or investment in complementary businesses, products, services, technologies, or other assets.
As far as stock price is concerned, I think the cited estimated range of $17-$19 is a fair price for what Sonos plans to do. It is a recognizable company that has been around for 16 years– and it seems like the reason for the IPO now is to expand and improve its standing in a competitive market. ~$18/share (to me) is a fair price to pay for potential growth, but also not terribly expensive if investors take a loss. A few things that concern me are that Sonos has not yet determined its estimated future expenses, so it cannot provide a budget for IPO proceeds yet. Also, Sonos has no plans/agreements for any acquisitions or investments– so it could either be waiting for the ‘right’ deal(s), but the IPO proceeds being used to fund/expand normal operations raises concerns about company leadership. All in all, however, I don’t think this would be a terrible investment for someone with the money to see what happens.
An upcoming IPO that i find to be interesting is for Sonos, a high end speakers company. I was at first surprised that Sonos had not already gone public, or been acquired by a larger technology company., since they have been around for a long time. In my experience with Sonos speakers, I have learned that they are a top quality product, and with ease they are connected to bluetooth devices and can be played by separate sources in different rooms of a house. So, overall i believe in their product and have high hopes for the company and its IPO. According to Nasdaq, Sonos aims to price its share between $17 and $19, which I feel may be a bit on the high side, as they are not as big a company as I first thought. It will raise approximately $105 million after selling its more than five and a half million shares. Sonos has announced last year they brought in a billion dollars in revenue, a steep 10% increase over the previous year, and I believe these numbers are sure to go up after its IPO< especially considering the increasing popularity of in home entertainment systems and voice assistants. Overall, I am confident in Sonos and believe it may be a good investment at its IPO coming this August.