Last week, Tim Hortons (TSE: THI, NYSE: THI) went IPO at $27 and opened trading at $36, though there were rumours about bids for as much as $70. The stock has mostly been falling ever since, trading at just over $31 today. The people who got hurt are most likely retail investors who bought into the media hype and believed they are getting in on the next Google.
Tim Hortons is a well-managed business with a wide moat here at home and I love their coffee and donuts (though I think the hot smoothie is disgusting). At some price, THI would be attractive, which for me is below the IPO price. As Bill Cara notes in this post, it is sad to see small retail investors getting hurt.
Note: I contributed two posts to the Carnival of Personal Finance and the Carnival of Investing.
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1 response so far ↓
1 Average Joe // Mar 30, 2006 at 7:21 pm
It is unfortunate for those people that got excited and bid the price up. But I don’t think it is the end of the world.
If they are in it for the long term, I am sure that Timmy’s stock price will continue to climb slowly. It just might be awhile before they see that $36 price again.
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