HO HUM

Stitch Fix’s highly anticipated IPO was ¯\_(ツ)_/¯

Obsession
Fashion
Obsession
Fashion

After announcing its long-awaited IPO in October, Stitch Fix officially began trading on the Nasdaq stock exchange Friday (Nov. 17).

It wasn’t exactly a blockbuster debut. Shares did pop a bit, opening at $16.90 apiece, slightly above the $15 it had priced at, and jumped around above $17 through the morning. But when it first set IPO terms earlier this month, Stitch Fix planned to sell 10 million shares at $18 to $20 each.

The company revised down that target range last night amid concerns from its investors over competition and its long-term growth prospects, according to the Wall Street Journal (paywall). Ahead of its opening, Stitch Fix sold just 8 million shares at $15 each.

Though the startup’s sales have shot up quickly since it launched in 2011, reaching $977.1 million last year, it just isn’t clear at this stage how big the company’s data-driven styling service can get. Stitch Fix is also competing against forces such as Amazon, which launched a similar clothing-box option earlier this year. Onlookers can’t help but compare Stitch Fix to food-box service Blue Apron, which has faced some struggles since its IPO and saw its stock plunge this summer as Amazon seemed to be eyeing the meal kit business.

It’s also uncertain whether Stitch Fix can be profitable in the long term. The company turned a profit in 2015 and 2016, but recorded a loss so far through 2017, according to its IPO filing.

Still, Stitch Fix has been a worthwhile investment for those who backed it. In 2014, when it last raised venture capital, it was valued at $300 million. Today, even with the downsized opening price, its value is about $1.5 billion.

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