US IPO Weekly Winners & Losers

It’s said that the Fed raises rates until something breaks. Something broke, and this week the Fed showed it may be willing to break some more.

The Federal Reserve raised interest rates a quarter of a percentage point, as it tries to thread the needle and battle inflation amid a banking crisis. It was largely expected, and the IPO market eked out a +1.1% gain, vs. +1.4% for the S&P 500.

This feels like “the beginning of the end” of the bear market. That should be good news, but I believe investors are still on guard for some event that causes widespread capitulation.

For now, there are no new bank failures or financial panics. String together enough of these weeks, and larger IPOs will come back.

Four small IPOs priced on the Nasdaq this week, all at $4 per share. The two largest raised about $15 million apiece and included a Singapore real estate platform (OMH) and a Malaysian ship refueling company (BANL).

The consumer sector led the Renaissance IPO Index this week, as shoe brand On went on a run, up +46.5% after a Q4 beat on growth and margins. Oil & gas play ProFrac was again the bottom performer, off -23.1% amid mediocre Q4 results and near-term headwinds from lower gas prices.

We’ve also seen filings from a few consumer-facing names in the IPO pipeline, with updated financials from Brazilian steakhouse Fogo Hospitality and car-sharing platform Turo.

Also: Low-float SPACs may be the new low-float micro-caps. This week, two SPACs approved their proposed mergers, JATT Acquisition and DiamondHead, and had single-day gains of +314% and +83% respectively. Caveat emptor.