Smithfield Foods' IPO priced below expectations, reflecting volatile earnings and numerous risks, making the stock appear cheap, but caution is warranted. Learn more on SFD stock here.

Smithfield Foods ( SFD, Financials) launched its IPO on Tuesday, starting trading at $21.05 before falling to $20.18 by midday. On Wednesday, shares were priced at $19.29 as of 3:34:43 PM EST, reflecting a 3.5% drop from the previous close.

This story incorporates reporting from Virginia Business, Investopedia on MSN.com and MSN.Smithfield Foods successfully raised $522 million through its initial public offering listed on the Nasdaq Global Select Market.

Hedgeye recommends Smithfield Foods (SFD) as a long idea post-IPO, citing potential 50% upside and undervaluation compared to peers.

Smithfield will not receive any proceeds from the sale of the shares by the selling shareholder. Acting joint lead book-running managers for the proposed offering include Morgan Stanley, BofA Securities and Goldman Sachs & Co.

Smithfield Foods, Inc., an American food company with a leading position in packaged meats and fresh pork products, debuted on the Nasdaq Global Select Market under the ticker symbol (NASDAQ:SFD). The initial public offering (IPO) opened at $21.