Chowdhry: Twilio And Nutanix Are Marching In The 'Junk IPO Parade'

Cypress Semiconductor Corporation CY, a technology company that supplies the automotive, industrial and networking platforms, announced earlier this week it will eliminate 500 jobs across the world.

The company said its reduction amounts to 7 percent of its global workforce as part of a cost-cutting plan.

According to Trip Chowdhry of Global Equities Research, Cypress' layoff announcement has broader implications. The analyst suggested that the company doesn't have a "durable and sustainable business."

Related Link: Global X Adds To Thematic With 3 New ETFs

A Barrage Of 'Junk' IPOs

Meanwhile, several recent IPOs can be put in the same category as Cypress as operating a company that is not durable and sustainable. The companies include Nutanix Inc NTNX, Twilio Inc TWLO and Apptio Inc APTI; all three stocks could "collapse by more than 70 percent" within the next eight to 12 months, if not sooner.

In fact, Chowdhry suggested that Nutanix, Twilio and Apptio will "be joining the previous junk IPO's" including Zynga Inc ZNGA, Groupon Inc GRPN, Fitbit Inc FIT, GoPro Inc GPRO, Twitter Inc TWTR and Box Inc BOX.

Finally, Chowdhry expects around 369,000 technology sector workers to lose their job throughout 2016. These individuals unfortunately have "obsolete skills" and "will remain unemployable" and merely join the tens of thousands of technology professionals who have already permanently dropped out of the employment pool.

Full ratings data available on Benzinga Pro.

Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!
Market News and Data brought to you by Benzinga APIs
Comments
Loading...
date
ticker
name
Price Target
Upside/Downside
Recommendation
Firm
Posted In: Analyst ColorAnalyst RatingsTechGlobal Equities ResearchIPOIPO BubbleTechnology BubbleTechnology Job CutsTrip Chowdhry
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!