Resideo IPOs, Then Plunges

By: Dan Gelinas, Published on Oct 31, 2018

ADI and Honeywell Homes management have been touting their spinout and IPO for months, including appearing on Wall Street as they widely shared on social media:

And:

However, the stock is down 29% from the start of when-issued trading, as shown below:

[Update: it fell again on day 3, falling as far as $19.40 but finishing the day down just another 3.79% at $21.08.

What is happening? What is the outlook for the newly independent company?

In this note we look at:

  • Strong Optimism from Resideo
  • Resideo's IPO
  • Steady Decline Over First Two Days
  • Valuation
  • Bull and Bear Case from Financial Experts

*** *** ********* ***** management **** **** ******* their ******* *** *** for ******, ********* ********* on **** ****** ** they ************ ** ****** *****:

***:

*******, *** ***** ** down **% **** *** start ** ****-****** *******, as ***** *****:

[******: ** **** ***** on *** *, ******* as *** ** $**.** but ********* *** *** down **** ******* *.**% at $**.**.

**** ** *********? **** is *** ******* *** the ***** *********** *******?

** **** **** ** look **:

  • ****** ******** **** *******
  • *******'* ***
  • ****** ******* **** ***** Two ****
  • *********
  • **** *** **** **** from ********* *******

[***************]

Strong ******** **** *******

*** ******* ******* *** announced ** ******* **** and **** *** ********* year, *** ******* ******** for *** ************ ******** ********** **** in *** **** **** on ******* **, ****, **** ***** *** Joe ***** ********** ********** that *** ******* ***** launch, **** *** *** create ***** *** ************:

***** ***, **'** ******* to *** *** **** executed ****. ****'* ********* number *. ***** ***, it's ***** ******* *** of *** ***** *** being ******. **** ** not * ***** ** company ****'* ****** ** figure *** *** ** get *** ******** **** he ***********. ** **** a ****** ******* ***** and **** **** ****. We **** **** **** top *** ****** *****. I’m ********* **** *** team **’** *** ********. We’re ****-********** ** ***** shareholder ****** **** *** future.

** *** ******** ****, Resideo ****** ******* ** company ***** ******* *** opening **** ** *** New **** ***** ******** on ******* ****, ********** with *** ***:

Resideo's ***

*** ***** ***** "****-****** *******" ** ******* ** at $** *** ** fell *** *** **** 2 ***** ** **** officially **** ******* ******* at ~$**, * **** of ***** **%:

Steady ******* **** ***** *** ****

*******'* ***** *** * steady ******* **** *** first *** **** ** trading *** ******** ********* under $**:

*********

*** *******'* ****** ********* is *** ~$*.* ******* USD (*** ******* ****** x ~$** *** *****) compared ** ******* ** ~$4.5 *******. ** ** low ******** ** *****.

***** **** ************ / **** distributor ******* ***** ********* but **** **** ****, it ** *** ***.

************ **** ** *** significantly ***** ********** ******** to ***** ***** ***** those businesses ******** ***** ****** relative ** ***** **** manufacturers. *** *******, ******* does ****** ~$ * billion ** ******* *** only *** * ****** market ************** ** ~$* billion. ** * ******* ratio, *** *** **** of *******'* ******** ***** ***** at ~$*** *******.

*** ********* **** **** of *** ******** ** significantly **** ********** **** the *** ****, **** though ***** *** ******** less *******. *************, **** with ****** ****** ***** like ********* ***** **** to ***** ** ** revenue ** ******.

********, **** ***** ************** put ******* ** * $3.2 ******* *********.

Analyst *****

** ******* ** ************.*** had **** *********** ****** to *** ***** *** Resideo *** [**** ** longer *********] *** *** it ********* ** ** did, claiming **** *** **** can ** ********** *** factors. *****, **** ***** investors *** ***** ******** to ****:

****-**** *** *********** ** investors (*** **** **** in ** ***) *** so ***** ** **** little ********* ********* *** new *******. *********, ** or *** ******** ***** the ***** *** ** it ** *** ******** to ************* *********. *******, the ****-*** ** ******* much ******* **** *** parent *******, *** **********, institutional ********* *** ********** **** ****** shares ** *** ****-***. Let ** *******. ** a ***** *** ****** fund ******* **** * large *** ******* ***** distributes * ***** *** spin-off, **** ****** **** manager’s ********** ******* ******** the ******* **** ******* the ****-***. *** ***** reasons, **** ********* **** their ****** ** *** spin-off ********** ** ***** or ********** *****.

******, **** ********** ******* a *** ******** ***** price:

*** ********** **** ** the *** ****-*** *** very ****** ********* ** promote *** ******* *********. In ****, *** ********** team ** ************ ** *** ******* the *****. ***? ******* management ***** ******* *** usually ****** ***** ** the ***** ****** ***** of *******. *** ***** the ***** ****** *********, the ******* ***** ********* the ******* ****.

********

******,* **-**** ********************* & **. ***** *** **** **** *** stock ***** **** **** **** 12-18 ****** ** $** (or ** ********* ********* of $*.* *******):

*** ****** ******** *** forecast, ******** **** * shift ****** ****** ****** products *** *** **** win *** ***:

**** ****** ****** *** categories, *** * ******** mix ***** ****** ******-****** Products ******** *** ********* revenues, ** ***** **** is ** *********** ********** opportunity. *** ** ** spun *** **** ****** Honeywell, ******* ** ******* on *** ************ ******* and ****** ******* ****** shares ** ********, ******* & **** *** ************. Its ***** *** *** line ****** *** ********* from *** ***** ****** “connected” *******, *** ******** could ***** ************. *** spin-off ** *** *** October **. ** ******** coverage **** ** ********** and $** ***** ******.

Bear ****

*************.*** ******* ***** *** **** ****, *********** that ******* *** ** pay ********* ** ** $140 ******* ******** *** the **** ** *****:

******* **** **** ******** to ********* ***** ******** indemnification *** ************* ********** that ******* ****** *********'* related ****** ********* ********, including *** ****** ******** liability **** ****** **** the ********** ** *** legacy ************** ******* ********... Given **** ***** ** no ***** ********* ****** and *** **** **** the ******* ** ** the **** *** *** next ** *****, ***** that ***** ** ******* visibility ********* *** ********* future **** ******, ****** it **** **** ********* to ********* ** ***** intrinsic *****. ***** *** maximum ********* **** *** company *** *** ** any ***** **** ** $140 *******, ** ** unclear ** **** *** magnitude ** ***** ******** will **.

**** ******** **** ***** $1.2 ******* **** *** risk **** ******** ******** could **** ** * recession:

********, ***** **** *** company ******* **** ** will ***** **** * limited ****** ** **** and *** ***** *** $1.2 ******* ******* ** loans ** **** *** financing *****, ** ***** that **** ******* ******** is *********. ** * prospective ********, *** ****** that ******* ************ ***** face ****** *********** ** over $*** ******* **** its ****** *********** *** interest ******** ******** ***** me ******* **** *** company ***** **** ** face ******* ******* ** there ** **** * sharp ******** ********. **** risk ******* ************ ********* when *** ******* **** the ******** ******** **** the ******* ****** **** is ******* *************.

Challenges ** ***** ******

***** ****** ***** ** magnify **** *** *** cycles *** *********, ********* to **** ******* **** Honovich:

***** ******* ** * small **** ** * publicly ****** ******* (** Resideo ********** ***) *** the ********* ** ******** information ***** * *******’* performance *** ********. **** things *** ***** ****, employees *** ***** *** brag ***, *** **** side ** **** **** do ***, ******** *** find ***. ********, *.*., lived ******* **** ***** of ****. ******* ** very ******* ****** *** good *** *** ** this.

******,*********'* *** **** ******* * ****** **** picked ***** ******** ** Canon **** ***** ******, noting:

[*****] ******, *** ********** would ** ****** ************, and **’* ********** ** under ******** ** ***********. To ** ******* ******, it ****’* ********* * was ******* ******* **.

******* ** *** ******* is ******* ******* ** this, **** *** ****. And *** **** **** is **** **** **** low ***** *****, **** do **** *** ********* to ****.

Poll / ****

Comments (20)

***, **** ****.

***, ***, **'* **** again *****, *** ***** $21:

$**, ** * *** a ***** ** ***********, or * ***** ** Resideo? ***** ****. *'** probably **** *** * few ***** ***** **** my *****, ****** ** yield * ****** ***, depending ** **** *** free **** *** ** the ***** **** **** week.

****** ****. * ****. It's **** ** * slide. ** **** ** interesting ** *** ** they *** ******** ********** ******** ******** *********** ** the ************ *****. 

***** *** *** *** their *** ***** ** one ** ***** ***** sales...

**** ******* ***. ****’* why *** ***** ***** going ****. 😂😂

**** ** **** *****!!!  Funny, *** *****.

*******'* ******** **** * have **** ** ***** Home ** ********* ****. As **** ********* ***** the **** *******, ********** is ******** ****** ***********. How ** ************* ** the ********** ***** **** about ****? *** **** to *** ******** ****, the *************' ** ********** systems *** *** ** seeing *** "****" *** of ***. *** *** Expo's **** *** ** miss **** **** **** more ******* ** ** a ****.  *** **** WhiteBox ***** ** ****** as * ********** ** other *************' ** *******, monitors, ***. ***'* ********* now ** ***** ************? I **** ***** ********** is ** ****** ** ADI.  * **** ********* don't *** **** *********** but **** *** ** be ********* ** **** sales. ** ** *** growing ** ***** ***** that ** ***** ** for **** ***** ** video, ******, ***. ** there *** * ******** Confidence ***** ** *************' Confidence ***** *** ***, what ***** ** **** like?

* ******* **** ************* on *** ******** ******, is **** ** **** where *** *** "**** VC *****" ****. ******* will **** *** *** of *****-********** ********* *** a **** ****.

* *** *** **** Nest ********** ** ******* coming *****, **** ****** software, ******** *********, *** the ******* ** **** to * ******* ****** at *****-**** ******* ** a ****, ********** ****** their ***** ** *** residential ****.

**********: *** ****** **** be **** *** ** a ****.

*** **** *** **** is * ********. ***** all **'* *** *** Honeywell. *** **** ******* I ***** *** ** worse **** ***** *** is *******.

**** ****** ** ******** in *** ***** ***** as **** ** **** in ********:

** ******* ** ************.****** **** *********** ****** to *** ***** *** Resideo ****** *** ** ********* as ** ***, ******** **** the **** *** ** attributed *** *******. *****, that ***** ********* *** being ******** ** ****:

****-**** *** *********** ** investors (*** **** **** in ** ***) *** so ***** ** **** little ********* ********* *** new *******. *********, ** or *** ******** ***** the ***** *** ** it ** *** ******** to ************* *********. *******, the ****-*** ** ******* much ******* **** *** parent *******, *** **********, institutional ********* *** ********** **** ****** shares ** *** ****-***. Let ** *******. ** a ***** *** ****** fund ******* **** * large *** ******* ***** distributes * ***** *** spin-off, **** ****** **** manager’s ********** ******* ******** the ******* **** ******* the ****-***. *** ***** reasons, **** ********* **** their ****** ** *** spin-off ********** ** ***** or ********** *****.

******, **** ********** ******* a *** ******** ***** price:

*** ********** **** ** the *** ****-*** *** very ****** ********* ** promote *** ******* *********. In ****, *** ********** team ** ************ ** *** ******* the *****. ***? ******* management ***** ******* *** usually ****** ***** ** the ***** ****** ***** of *******. *** ***** the ***** ****** *********, the ******* ***** ********* the ******* ****.

******* ***** ***** ****, a ***** *****, *** despite * **** ** the ***** **** ** November, ***** ** ***** $21:

******* **** *% ******* for ***** *** ********* brand, ***** *** ******* annual ******* ** $** million, *** *** *****, CFO, ** ******** ******* investor **********.

******* ** ***** $***??? ($30M ** *% ** $3BN).

*** *********** #*, **** valuation ** **** ** determined ** *** ********* in *** ******** *****:

*********

*** *******'* ****** ********* is *** ~$*.* ******* USD (*** ******* ****** x ~$** *** *****) compared ** ******* ** ~$4.5 *******. ** ** low ******** ** *****.

***** **** ************ / half *********** ******* ***** valuation *** **** **** that, ** ** *** low.

************ **** ** *** significantly ***** ********** ******** to ***** ***** ***** those ********** ******** ***** income ******** ** ***** than *************. *** *******, Anixter **** ****** ~$ 8 ******* ** ******* but **** *** * public ****** ************** ** ~$2 *******. ** * similar *****, *** *** side ** *******'* ******** would ***** ** ~$*** million.

*** ********* **** **** of *** ******** ** significantly **** ********** **** the *** ****, **** though ***** *** ******** less *******. *************, **** with ****** ****** ***** like ********* ***** **** to ***** ** ** revenue ** ******.

********, **** ***** ************** put ******* ** * $3.2 ******* *********.

*****, *** ****'** ****** the *% ** *******, not *********. * *** assuming *** ********* *** a ****** *** ** future-looking ****/***** ** **, but **** **** ****'** basically ****** ** **. Guess * *******'* ** too *********, *** ****** considered.

******* ************** ** ********** *** the ***** **** **%:

***** * ******* *****? Place **** ****!

**** ******* **** *** past * ******:

******: ******* ***** *** plunged **********, **** ~**% to ~$** ***:

*** ******* '*** **********' *******************-********** ************* ***** *********** ********.

********* ** ***** *******, looks **** *** ** fine *** *** ***** business ***** **** ********:

** *** ***** *******, the *** ****** ************ business ********* ** **** as *******. *** ******** & ********* ******* *********** revenue ******* ** ******* product ******** ** *** Comfort ******** *** ** its *********** ******* ********* (RTS) *** ********** ********. We ******* *** *** slowdown *** ****** ** certain ****** ********** ******* and * ******* ******** across ***** *** ********* in *** ******.

***** *** ****** "***", some ****** ***** ** a *** ****** ****.....~$**.** now ***** ** >**%...

Read this IPVM report for free.

This article is part of IPVM's 6,385 reports, 860 tests and is only available to members. To get a one-time preview of our work, enter your work email to access the full article.

Already a member? Login here | Join now

Related Reports

ADI Sales Down 21% in April on May 14, 2020
ADI sales were down 21% in April, the company disclosed, as the pandemic hits the security industry. Inside this note, we examine: ADI...
Pivot3 Mass Layoffs on Mar 27, 2020
Pivot3 has conducted mass layoffs, the culmination of grand hopes, a quarter of a billion dollars in VC funding, and multiple failures to gain...
Dahua Revenue Plunges, 3 Execs Resign on Apr 29, 2020
Dahua's sales dropped by 19.47% in the first quarter of 2020 amid the coronavirus pandemic, while three senior executives resigned, including its...
Fever Camera Sales From Integrators Surveyed on Jun 01, 2020
Fever cameras are the hottest trend in video surveillance currently but how much are integrators selling them? 220 integrators answered the...
Integrators Rising Against Coronavirus on May 27, 2020
IPVM integrator statistics make it clear - Coronavirus's impact on business is lessening and many are anticipating even better news in weeks...
Convergint Outlook Turns Negative on Apr 16, 2020
Convergint's outlook has turned negative, according to bond rater Moody's, released shortly after IPVM's report about Convergint's billion dollars...
Bottom: Integrators Start To Stand Vs Coronavirus on Apr 20, 2020
Good news - IPVM integrator statistics show that while coronavirus has hit integrators hard, it is now bottoming out and starting to...
Intersec 2020 Final Show Report on Jan 21, 2020
IPVM spent all 3 days at the Intersec 2020 show interviewing various companies and finding key trends. We cover: Middle East Enterprise...
Hikvision And Dahua Now Blocked From Conforming ONVIF Products on Apr 03, 2020
Dahua and Hikvision, sanctioned for human rights abuses, are now blocked from submitting products for ONVIF conformance, a blow to the mega China...
Terrible Convergint Coronavirus Thermal Camera Recommendation on Apr 01, 2020
A week after Convergint disclosed falling revenue, pay and job cuts, Convergint is touting 'extensive research' that is either grossly incompetent...

Most Recent Industry Reports

Uniview Deep Learning Camera Tested on Jul 14, 2020
Uniview's intrusion analytics have performed poorly in our shootouts. Now, they have released their Prime Series Deep Learning cameras, with an...
Drako's Companies (Brivo, Eagle Eye) Take $4+ Million in PPP Funds on Jul 14, 2020
While centimillionaire Dean Drako is the owner of two of the largest SaaS businesses in the security industry (Brivo and Eagle Eye), Drako's...
Defendry Presents AI Active Shooter Security System on Jul 14, 2020
Defendry presented its Active Shooter security system at the May 2020 IPVM Startups show. A 30-minute video from Defendry including IPVM...
Ban Rules Released: Use Dahua or Hikvision, No Government Contracts on Jul 13, 2020
The US government has released the rules implementing the "Prohibition on Contracting with Entities Using" Dahua, Hikvision, and Huawei based...
JCI Sues Genetec For Patent Infringement on Jul 13, 2020
Surprisingly, security giant JCI has sued their partner, security software developer Genetec, for patent infringement. Inside this note,...
Remove Dahua and Hikvision Equipment "Immediately" Or Else Banned From US Government Contracts on Jul 10, 2020
The US government has directed contractors to remove covered equipment, such as Dahua, Hikvision, and Huawei Hisilicon products, "immediately." If...
ZeroEyes Presents Firearm Detection Video Analytics on Jul 09, 2020
ZeroEyes presented its Firearm detection Video Analytics system at the May 2020 IPVM Startups show. A 30-minute video from ZeroEyes...
Directory of 164 "Fever" Camera Suppliers on Jul 09, 2020
This directory provides a list of "Fever" scanning thermal camera providers to help you see and research what options are available. There are...
Clinton Public View Monitor (PVM) Mask Detection Tested on Jul 09, 2020
Face mask detection, or more specifically not wearing one, is expanding amidst the pandemic. Clinton Electronics has added this capability to their...
These Florida Real Estate Agents Are Now Selling "SafeCheck USA" Temperature Detectors on Jul 09, 2020
The "Kakon Brothers", William and Nathan, are self-described "south Florida Power Agents specializing in Luxury Real Estate" who "have closed over...