Cardlytics Could Crumble With Lockup Expiration

The 180-day lockup period for Cardlytics Inc. (CDLX) ends on August 31st, 2018. When this period concludes, the company’s pre-IPO shareholders have the opportunity to sell large blocks of currently-restricted securities. The potential for a sudden increase in the volume of shares traded on the secondary market could negatively impact the stock price of CDLX in the short term when the IPO lockup expires.

(Source: S-1/A)

Currently, CDLX trades in the $20 to $21, significantly higher than its IPO price of $13. CDLX had a first-day return of 2.8%. Since IPO, shares have climbed steadily to reach $18.82 on February 23, but they dropped to $13.41 on April 27. CDLX has a return from IPO of 58.6%.

Please Note:

While the 180-day IPO lockup expiration for CDLX was scheduled for August 8th, 2018, this date is usually delayed when the company reports earnings within close proximity to the IPO lockup expiration. SAIL reported Q1 results on August 14th.

In our seven-year study of IPO lockup expirations, we have found this period of delay to be 17 calendar days from the date of earnings, making the adjusted lockup expiration for CDLX 8/31/18.

Business Overview: Business Intelligence Platform Focused on Purchasing Data

Cardlytics operates a platform that analyzes purchasing data in the United States and the United Kingdom. The company has two segments: Cardlytics Direct and its Other Platform Solutions. The Cardlytics Direct solution is a proprietary native advertising channel, which enables marketing agents to reach consumers via mobile and online banking channels. It also enables marketing companies to utilize the purchasing intelligence through other channels.