After NASDAQ listed, Robinhood fell below the offer Reuters

(Reuters)-Online brokerage company stocks Robinhood market Inc (NASDAQ:) fell below the issue price shortly after its Nasdaq debut on Thursday, disappointingly one of the most anticipated listings this year.

The stock price fell 5% to US$36.07 in early trading. Based on the opening price of 38 US dollars, the value of the brokerage business is approximately 31.75 billion US dollars.

The company can be said to be a breakthrough financial technology startup of its generation. On Wednesday, it priced its IPO at the low end of the range of $38 to $42 and raised $2.1 billion.

A few months ago, it was caught in a standoff between a new generation of retail investors and Wall Street hedge funds.

Earlier this year, after its clearinghouse deposit requirements increased tenfold, the company decided to restrict the trading of some popular stocks, which angered U.S. lawmakers and users of its app, which is owned by retail investors. Preferred destination.

Its easy-to-use interface has made it popular among young investors who trade at home during the restrictions caused by the coronavirus, and its popularity has soared in the past 18 months

Jeff Zell, a senior research analyst at IPO Boutique, said that at this level of valuation, there are more doubters than believers about the company.

“That said, there is a ray of hope for this performance or underperformance because it set’expectations’ at the low end of the scale when Robinhood reported its first few quarters, Zell said.

“But overall, the company still has a lot to prove.”

Due to the so-called meme stock trading frenzy, Robinhood’s revenue increased fourfold in the March quarter. But this comes at a price, making it the center of multiple regulatory investigations.

Due to the sharp rise in retail transactions, the company’s finances were tight, and it was forced to raise US$3.4 billion in emergency funds.

The company was founded in 2013 by roommates Vlad Tenev and Baiju Bhatt of Stanford University. The two will have a majority of voting rights, with Bhatt holding approximately 39% of the outstanding shares and Tenev holding approximately 26.2%.

It had planned to reserve 20% and 35% of its products for users of its trading platform, allowing users to conduct unlimited commission-free transactions in stocks, exchange-traded funds, options, and cryptocurrencies.

Robinhood Chief Financial Officer Jason Warnick told Reuters that he expects the IPO to demonstrate the benefits of allocating large stocks to retail investors.

The company revealed on Tuesday that it has received inquiries from U.S. regulators asking employees whether to conduct transactions. Game stop company (NYSE:) and AMC Entertainment (NYSE:) before the online broker publicly announced restrictions on the trading of these and other meme stocks on January 28.

The company also said that it is investigating whether it meets the personnel registration requirements.