Planet Fitness opened to disappointing trading during its IPO on Thursday. The company, which touts its $10 per month fitness memberships, launched at the top of its $14 to $16 IPO price. Shares at the company quickly slid to $13.75 before recovering to its $16 IPO price.
NYSE trader Peter Tuchman told FOXBusiness, “While it opened at a discount to the initial deal price of $16, the amazing price discovery system still in place on the floor of the NYSE for over 100 years found the right level to open the stock at $14.50, a price where public buyers saw value and wanted to get involved,”
The company raised $216 million through the sale of 13.5 million shares. That price excluded an overallotment option which gave underwriters the ability to sell additional shares if certain circumstances were met.
“In a very volatile down session this IPO has performed well after its potentially disappointing open, having steadily risen in a very negative tape to a high of $16.17 and settling in for a fine overall performance,” adds Tuchman.
The company, which started franchising in 2003 has risen to more than 1,000 locations and seven million members. The company’s CEO says the IPO will allow the company to expand.
Planet Fitness has risen to the top of its competition by promoting an atmosphere where members are never judged. The company even uses an alarm system that will call out people for judging other members or for letting out “workout style” grunts during a workout.