When I selected the interesting IPOs, I knew I would encounter surprises. Nothing was checked in advance to be able to tell a smooth story. I just went step by step. This time there was a surprise indeed, or actually two.
Photo by loilamtan on Pixabay
Beyond Meat, the IPO with a very high return on its shares had a negative equity! Earlier, I already encountered negative equity (meaning that the Total Liabilities are higher than the Total Assets and if such a firm would be liquidated, a debt would remain). Because I thought AnRep3D would not be able to handle this, I kept those (rare) cases out.
This time I had no choice, so during the preparation of this post (mostly while brushing my teeth and shaving) I was thinking about a solution. For now I decided it for now it would be best to just set the negative equity to zero. The next step could be to change the colour of the whole building to e.g. blue, just like a green roof changes to a red one when the profit is negative (usually referred to as a loss). This can be done manually, but it should be a part of the generator, of course.
Then another surprise came in. I prepared my input-file during the evening and put the negative equity in without thinking. Today I forgot about the negative equity and generated the 3D-graph. To my surprise the AnRep3D-generator was quite able to deal with a negative equity after all. The “buildings” with a negative equity somehow became transparent. From some angles they are black, as if they don’t really exist. From other angles the loss (red roof) is visible.
I decided to create the other graph, with the negative equity set to zero as well and present both versions this time.
Double click a screenshot to open the real 3D-graph first and manipulate its position: Clicking the right mouse-button, moving the mouse up and down will zoom the graph in and out. Clicking left and moving the mouse will tilt the graph in different directions (or move the observer’s viewpoint around a fixed graph – it’s relative of course). Double clicking in the graph translates it and moves the centre at the same time. As a result the way the graph tilts will change. Just try it. If you don’t know how to get the normal position back, just refresh the graph.
Again I could not get hold of a form 10Q for Q4 2018 for Beyond Meat, so I did the same as last time for Sonim: I took the Annual Report (form 10K) 2018. Equity and Total Assets are OK since those values represent the end of December. For Revenue and Profit I divided the annual total by four. Because of this the “2018 Q4” label is still presented with quotes.
Fortunately the IPO went well for Beyond Meat – and also for the buyers of the shares. At this moment the return is still nearly 230 percent, although most of the increase was already observed at the closing of the day of the IPO.
Looking at the graph we see a lot of red roofs, for both Sonim and Beyond Meat. Only Sonim managed to show a real profit in 2018, before the IPO. It is presented as the Q4-value in the graph, but we cannot be sure about it, as it’s the quarterly average for 2018, presented as the Q4-value.
If you want to know more about the AnRep3D-geneator, please have a look at our website or visit our youtube-channel, showing all details of AnRep3D in short videos of a couple of minutes. Do you want to try it yourself? Download the free 3D-graph generator package.