a.k.a. Brands Aims For $250 Million IPO

seekingalpha2021-09-22

Summary a.k.a. Brands Holding has filed proposed terms for a $250 million IPO. The firm acquires and operates apparel sellers via a direct-to-consumer [DTC] and mobile-first approach. While the IPO ...

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lee1234
2021-09-22
lee1234
Like
Chrissssy
2021-09-22
Chrissssy
I’m here to clear my mission
- e13v3n:
  same
- MarcO:
  great
fernandes
2021-09-22
fernandes
Ok

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Brands Holding has filed proposed terms for a $250 million IPO.\nThe firm acquires and operates apparel sellers via a direct-to-consumer [DTC] and mobile-first approach.\nWhile the IPO ...</p>\n\n<a href=\"https://seekingalpha.com/article/4455224-ipo-update-aka-brands-aims-for-250-million-ipo\">网页链接</a>\n\n</div>\n","source":"seekingalpha","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>a.k.a. Brands Aims For $250 Million IPO</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\na.k.a. Brands Aims For $250 Million IPO\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-09-22 20:36 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4455224-ipo-update-aka-brands-aims-for-250-million-ipo><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\na.k.a. Brands Holding has filed proposed terms for a $250 million IPO.\nThe firm acquires and operates apparel sellers via a direct-to-consumer [DTC] and mobile-first approach.\nWhile the IPO ...</p>\n\n<a href=\"https://seekingalpha.com/article/4455224-ipo-update-aka-brands-aims-for-250-million-ipo\">网页链接</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"AKA","symbol_name":"a.k.a. Brands Holding Corp.","start_time":0,"source_url":"https://seekingalpha.com/article/4455224-ipo-update-aka-brands-aims-for-250-million-ipo","article_id":"1184855575","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=1184855575","pubTimestamp":1632314204,"columns":[],"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"Summary\n\na.k.a. Brands Holding has filed proposed terms for a $250 million IPO.\nThe firm acquires an","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"AKA":"a.k.a. Brands Holding Corp."},"translate_title":"又名。Brands拟IPO 2.5亿美元","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"AKA":0.9},"content_text":"Summary\n\na.k.a. Brands Holding has filed proposed terms for a $250 million IPO.\nThe firm acquires and operates apparel sellers via a direct-to-consumer [DTC] and mobile-first approach.\nWhile the IPO isn't cheap, AKA is growing through acquisition and appears well positioned for its target demographic, so the IPO is worth a close look.\n\nQuick Take\na.k.a. Brands Holding Corp. (AKA) has filed to raise $250 million from the sale of its common stock in an IPO, according to an amendedregistration statement.\nThe company acquires consumer apparel brands and focuses on a direct-to-consumer business model.\nAlthough the IPO isn’t cheap, I believe AKA has significant room to grow and continue executing its business model approach, so the IPO is worth consideration.\nCompany & Technology\nSan Francisco, California-based a.k.a. Brands was founded to develop a portfolio of digitally-focused, DTC consumer apparel and fashion brands with a global reach.\nManagement is headed by Chief Executive Officer Jill Ramsey, who has been with the firm since May 2020 and was previously Chief Product and Digital Revenue Officer at Macy's.\nThe company’s primary offerings include:\n\nPrincess Polly\nCulture Kings\nPetal & Pup\nRebdolls\n\nBelow is the a.k.a. platform as it currently stands:\na.k.a. Brands has received at least $330 million in equity investment from investors including New Excelerate, Beard Entities and Bryett Enterprises Trust.\nCustomer Acquisition\nThe company focuses its marketing efforts on Millennials and Gen Z consumers who 'seek fashion inspiration on social media and primarily shop online and via mobile devices.'\nSo, a.k.a. leverages its data to provide relevant social content and make other digital marketing strategy efforts to reach consumers directly online.\nSelling expenses as a percentage of total revenue have risen as revenues have increased, as the figures below indicate:\nThe Selling efficiency rate, defined as how many dollars of additional new revenue are generated by each dollar of Selling spend, was stable in the most recent reporting period, as shown in the table below:\nFor a.k.a.’s largest property, Princess Polly, user engagement measured by average number of pages per visit on that website has remained relatively flat over the last two years, with a recent slight increase to a current blended average desktop/mobile of 7.28 pages per visit, as the chart shows below:\n\n(Source:Similarweb)\nAccording to a marketresearch reportby BlueCart, the global market for DTC (direct-to-consumer) sales is expected to reach $20 billion globally in 2021.\nThis represents a forecast potential increase of 15% over results in 2020.\nThe main drivers for this expected growth are an increase in consumer openness to hearing directly from manufacturers via online channels.\nAlso, there is a growing desire by businesses to gain an edge through greater data-driven insights stemming from direct relationships with their customers rather than working through 3rd party distributors and retail outlets.\nMajor competitive or other industry participants by type include:\n\nEcommerce companies\nIn-person stores\n\nFinancial Performance\na.k.a. Brands’ recent financial results can be summarized as follows (includes 55% stake in Culture Kings Group):\n\nSharply growing topline revenue\nGrowing gross profit\nIncreasing gross margin\nUneven operating profit and margin\nVariable cash flow from operations\n\nBelow are relevant financial results derived from the firm’s registration statement:\nAs of June 30, 2021, a.k.a. Brands had $34.3 million in cash and $277.8 million in total liabilities.\nFree cash flow during the twelve months ended June 30, 2021, was $28.7 million.\nIPO Details\nAKA intends to sell 13.9 million shares of common stock at a proposed midpoint price of $18.00 per share for gross proceeds of approximately $250 million, not including the sale of customary underwriter options.\nNo existing shareholders have indicated an interest to purchase shares at the IPO price.\nAssuming a successful IPO at the midpoint of the proposed price range, the company’s enterprise value at IPO (ex- underwriter options) would approximate $2.3 billion.\nExcluding effects of underwriter options and private placement shares or restricted stock, if any, the float to outstanding shares ratio will be approximately 10.72%. A figure under 10% is generally considered a ‘low float’ stock which can be subject to significant price volatility.\nPer the firm’s most recent regulatory filing, it plans to use the net proceeds as follows (in conjunction with a planned new senior secured credit facility):\n\n(Source)\nManagement’s presentation of the company roadshow isavailable here.\nRegarding outstanding legal proceedings, management believes that any legal claims against it would not be material to its operations or financial condition.\nListed bookrunners of the IPO are BofA Securities, Credit Suisse, Jefferies and other investment banks.\nValuation Metrics\nBelow is a table of the firm’s relevant capitalization and valuation metrics at IPO, excluding the effects of underwriter options:\n\nCommentary\nAKA is going public to pay down debt and for its future expansion plans.\nAKS’ financials show sharply growing topline revenue and gross profit, increasing gross margin but uneven operating profit and margin and variable cash flow from operations\nFree cash flow for the twelve months ended June 30, 2021, was $28.7 million.\nSelling expenses as a percentage of total revenue have risen as revenue has increased and its Selling efficiency rate was stable at an impressive 2.3x.\nThe market opportunity for selling fashionable clothing direct to consumer [DTC] aimed at younger demographics is large and expected to grow substantially in the years ahead.\nBeing a mobile-first DTC firm, AKA is well-positioned to adjust to a market that is focused on using online, mobile-phone app purchase modalities.\nBofA Securities is the lead left underwriter and IPOs led by the firm over the last 12-month period have generated an average return of 11.5% since their IPO. This is a mid-tier performance for all major underwriters during the period.\nThe primary risk to the company’s outlook is the high rate of change in consumer tastes and preferences, which can make it challenging and costly to react to changes in a compressed time period.\nAs for valuation, compared toa basketof publicly held Apparel companies complied by noted valuation expert Dr. Aswath Damodaran which as of January 2021 had an average EV/Sales multiple of 2.03x, AKA is seeking an EV/Revenue multiple of 5.03x.\nAKA is growing topline revenue sharply, in part due to its acquisition activities but its operating margin was 4.6% in the most recent six-month period versus the public basket of an average of 5.93%.\nSo AKA is growing quickly through acquisition but has a lower operating margin than its public peers.\nHowever, I favor DTC companies for things like apparel, as the firm can adjust its offering much faster and more accurately as a result of its direct relationship with customers.\nAlso, AKA’s mobile-first approach combined with DTC business model also positions the firm well for its target demographic of younger consumers.\nAlthough the IPO isn’t cheap, I believe AKA has significant room to grow and continue executing its business model approach, so the IPO is worth consideration.","kind":"news","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[{"id":869428710,"gmtCreate":1632318124330,"gmtModify":1632801290772,"author":{"id":"3579516715925048","authorId":"3579516715925048","name":"lee1234","avatar":"https://static.tigerbbs.com/c1a0ecabeae2d32250fce1eb7e612d3d","vip":1,"crmLevel":4,"crmLevelSwitch":0,"authorIdStr":"3579516715925048","idStr":"3579516715925048"},"htmlText":"Like","listText":"Like","text":"Like","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/869428710","repostId":1184855575,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":869437938,"gmtCreate":1632315476824,"gmtModify":1632801319506,"author":{"id":"3581992421704233","authorId":"3581992421704233","name":"Chrissssy","avatar":"https://static.tigerbbs.com/670519b0df7f01f6802e6a220a6fc578","vip":1,"crmLevel":2,"crmLevelSwitch":0,"authorIdStr":"3581992421704233","idStr":"3581992421704233"},"htmlText":"I’m here to clear my mission","listText":"I’m here to clear my mission","text":"I’m here to clear my mission","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":2,"commentSize":2,"repostSize":0,"link":"https://laohu8.com/post/869437938","repostId":1184855575,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":5959542,"gmtCreate":1632316139764,"gmtModify":1634789096945,"authorId":3565819252889467,"author":{"id":3565819252889467,"idStr":"3565819252889467","authorId":3565819252889467,"name":"e13v3n","avatar":"https://static.tigerbbs.com/387ab24895655e32d7ddaf87ded7da37","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":869437938,"type":1,"supId":0,"prevId":0,"content":"same","text":"same","html":"same"},{"id":5959580,"gmtCreate":1632316356699,"gmtModify":1634789094749,"authorId":3579404034455974,"author":{"id":3579404034455974,"idStr":"3579404034455974","authorId":3579404034455974,"name":"MarcO","avatar":"https://static.tigerbbs.com/be5697566d0f1acd47a2c200cbfe60f0","vip":1,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":869437938,"type":1,"supId":0,"prevId":0,"content":"great","text":"great","html":"great"}],"langContent":"EN"},{"id":869437003,"gmtCreate":1632315471802,"gmtModify":1632801319628,"author":{"id":"4089969261759080","authorId":"4089969261759080","name":"fernandes","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":2,"crmLevelSwitch":0,"authorIdStr":"4089969261759080","idStr":"4089969261759080"},"htmlText":"Ok","listText":"Ok","text":"Ok","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://laohu8.com/post/869437003","repostId":1184855575,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"}],"isCommentEnd":false,"newsSizeData":{"likeSize":47,"commentSize":3,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; 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