Oaktree Capital Group in its first day of trading Thursday fell short of its expected $43 to $46 per share price range the company had predicted in regulatory filings.
The stock, priced at $43 a share on Wednesday, opened trading on the New York Stock Exchange under the symbol OAK Thursday morning at $41 a share; it closed at $42.35.
Oaktree Capital Management, whose parent is Oaktree Capital Group, is the first money management firm to go public this year.
The distressed debt manager sold 8.84 million of its 11.3-million-share IPO and raised $380.3 million, less than the almost $600 million it could have realized if the IPO had been more successful.
“The shares were badly priced,” said Scott Sweet, senior managing partner of IPO Boutique, a research firm. Mr. Sweet said investors weren't confident about Oaktree's future earnings and that the stock should have been priced lower by investment bankers. Goldman Sachs Group and Morgan Stanley were the lead underwriters for the IPO.
Mr. Sweet said the poor performance of other money managers that have gone public over the last few years has also not inspired confidence in the money management sector.
Howard Marks, Oaktree Chairman and founder, did not return phone calls.