Starting today, investors will get their first bite of Crocs Inc.
The Niwot shoemaker set an initial price of $21 a share late Tuesday, slightly above the company’s recently revised forecast of $19 to $20 apiece.
Shares of the much sought-after company will begin trading today on the Nasdaq Stock Market under the ticker symbol CROX.
“The expectation is that the retail public will trip over themselves in the aftermarket” to scoop up the shares, said David Menlow, head of IPOFinancial.com in New Jersey.
The share price could double because of strong investor demand, other impressive initial stock sales recently and Crocs’ growth, he said.
For the nine months ending Sept. 30, Crocs earned $12.6 million on $75 million in revenue, up from a net loss of $627,000 on $8.1 million in revenue during the comparable period in 2004.
Crocs, whose brightly colored rubber clogs have achieved a cult following among teenagers, hospital workers and movie stars, raised more than $207.9 million through the offering.
The company sold 4.95 million shares, raising net proceeds of at least $87 million. The current shareholders, including the trio of Boulder entrepreneurs who launched the company in 2002, also sold 4.95 million shares.
The lead underwriters, Piper Jaffray and Thomas Weisel, were in charge of doling out shares. The largest recipients were the firms’ wealthiest and longest-standing clients, as well as large institutional investors such as mutual and hedge funds.
Most individual investors can snap up shares only on the secondary market.
“You never can tell what will happen, but I’ll use my savings to buy 500 to 1,000 shares,” said retired aerospace engineer Jack Spurlin, 82, a former Boulder resident who lives in New Mexico. “I’ve been following that little company for two years.”
If Crocs’ shares double, they would match Chipotle Mexican Grill, the Denver burrito chain that sold stock publicly for the first time last month. As a result, “individual investors may be getting in at levels that are too high,” Menlow said.
Even so, recent initial stock sales by apparel companies, including those for athletic-apparel maker Under Armour Inc. and casual clothier Volcom Inc., have doubled since their debuts.
Renaissance Capital, a Greenwich, Conn.-based firm that tracks IPOs, selected Crocs as its IPO of the week “because of the tremendous consumer demand for its shoes and strong potential for growth – at least near term,” a research report said.
Staff writer Will Shanley can be reached at 303-820-1260 or wshanley@denverpost.com.
