Prior to Thursday, investors in online music and software distributor Navarre (Nasdaq: NAVR), a subsidiary of NetRadio (Nasdaq:NETR), had long been anticipating the initial public offering of NetRadio’s online broadcasting company. The thinking was that a strong IPO could help boost Navarre’s struggling stock price.
Well, NetRadio went public at $11 on Thursday and closed down a point. Navarre investors felt the pain as shares of Navarre tumbled 2-1/8 to 8-3/16, a loss of more than 20 percent. Navarre stock, which has been as high as 27 this year, might be oversold at this point, but what happened Thursday underscores the fact that there’s no certainty of success when investors buy into the parent of a company that’s about to go public.