Just two companies went public this week, and one postponed hours before pricing. Five companies and two SPACs submitted initial filings.
The story of the week was Peloton (PTON); the fitness equipment retailer broke issue, opening at $27 after pricing at the high end of their range. It traded further down, ending the week down 13%. It raised $1.2 billion at a $9.6 billion valuation and raised an additional $100 million through a private placement with existing shareholder TCV.
Non-prime lender Oportun Financial (OPRT) priced its $94 million deal at the low end for a $425 million valuation. The company’s use of fair value accounting makes it appear priced at a discount to its peer group, but with amortized cost accounting would likely be near or above the group pricing median. However, the stock
finished the week up 8%.
| 2 IPOs During the Week of September 23rd, 2019 | |||||
|---|---|---|---|---|---|
| Issuer Business |
Deal Size |
Market Cap at IPO |
Price vs. Midpoint |
First Day Return |
Return at 09/27 |
| Oportun Financial (OPRT) | $94M | $425M | -6% | +8% | +8% |
| Provides loans to low- or moderate-income consumers with limited credit history. | |||||
| Peloton (PTON) | $1,160M | $9,554M | 5% | -11% | -13% |
| Sells connected home fitness equipment and monthly class subscriptions. | |||||
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Chinese health and wellness retailer Ecmoho (MOHO) filed for an estimated $150 million US IPO. Insurance platform BRP Group (BRP), fertility benefits provider Progyny (PGNY), and gene-editing biotech Beam Therapeutics (BEAM) all filed for $100 million IPOs. Chinese trucking logistics company MingZhu Logistics (YGMZ) filed for a $13 million US IPO. Two SPACs filed as well.
| 7 Filings During the Week of September 23rd, 2019 | |||
|---|---|---|---|
| Issuer Business |
Deal Size |
Sector | Lead Underwriter |
| Beam Therapeutics (BEAM) | $100M | Health Care | JP Morgan |
| Early stage biotech developing genetic medicines for a variety of diseases. | |||
| MingZhu Logistics (YGMZ) | $13M | Industrials | ViewTrade |
| Provides trucking services and logistics in China. | |||
| Progyny (PGNY) | $100M | Financials | JP Morgan |
| Provides fertility solutions and benefit programs for employer health plans. | |||
| Stable Road Acquisition (SRACU) | $150M | SPAC | Cantor Fitz. |
| Blank check company focused on companies within the cannabis industry. | |||
| Union Acquisition II (LATNU) | $175M | SPAC | Cantor Fitz. |
| Blank-check company targeting businesses in Latin America | |||
| Ecmoho (MOHO) | $150M | Technology | UBS |
| Operates an online retail platform for non-medical health and wellness products in China. | |||
| BRP Group (BRP) | $100M | Financials | JP Morgan |
| Provides insurance brokering and risk management services. | |||
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Global entertainment company Endeavor Group (EDR) slashed its valuation by 17% the day it was set to price, then immediately postponed its $398 million IPO, citing market conditions.
After delaying its IPO last week to the 4Q19, The We Company (WE) continued its fall from grace with Adam Neumann stepping down as CEO and ceding majority control of the company. The company will reportedly trim ranks significantly in preparation to tap public markets.
IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 9/26/19, the Renaissance IPO Index was up 23.9% year-to-date, while the S&P 500 had a gain of 18.8%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Spotify (SPOT) and VICI Properties (VICI). The Renaissance International IPO Index was up 12.2% year-to-date, while the ACWX was up 11.9%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include Meituan-Dianping and SoftBank.
