An unprofitable yoga chain is Wall Street’s latest failed IPO

Lululemon yoga
A handful of yoga enthusiasts pray for the resurrection of YogaWorks’ pulled IPO. Lululemon Athletica/Flickr

This one didn’t even make it to market.

YogaWorks, a chain of 50 studios spread across six US metropolitan areas, pulled its initial public offering on Thursday, the day it was originally expected to price, citing market conditions.

The offering’s underwriters — led by Cowen, Stephens and Guggenheim — set a range of $US10 to $US12 a share in a regulatory filing on July 10. A pricing at the top of the range would have marked a valuation of roughly $US70 million.

It’s certainly an interesting rationale for pulling the deal, considering multiple US equity benchmarks closed at record highs on Wednesday. Not to mention the CBOE Volatility Index — or VIX — which serves as a gauge for investor fear, is locked near its lowest levels on record.

While some might cite a difficult IPO environment that most recently saw meal kit maker Blue Apron limp to the finish line, it’s also possible potential investors just weren’t sold on the company at that valuation. After all, the company is unprofitable at the moment, posting net losses in each of the last two years, as well as in the first quarter of 2017.

Blue Apron is also not the best basis for comparison, because its severely dented IPO price and subsequent weak trading was spurred by Amazon encroaching on its competitive territory through its blockbuster acquisition of Whole Foods. YogaWorks has no such excuse.

In a frantic final week before going public, Blue Apron cut its range by more than 30%, and now trades about 34% below its final IPO price of $US10 a share.

Meanwhile, recently-IPOed social media player Snap has showed that a successful IPO doesn’t even necessarily translate to success in the open market. After pricing at $US17 a share on March 1, the company’s stock has taken a beating, falling 12% to $US14.97 through Wednesday’s close.