With many of the IPOs producing slam-dunk returns in 2013, Renaissance Capital would like to present the inaugural IPO Madness. The Renaissance Capital analyst team has selected sixteen of this year’s IPOs from the NYSE, Nasdaq, Private Equity and Venture Capital regions to compete against each other over the next four weeks in a single-elimination tournament. To qualify, a company had to go public in 2013 and complete its listing by March 22. Whichever stock has the greater weekly return will survive to fight in another round until there is only one IPO left standing. We will publish recaps and previews of the matchups each week, so make sure to check on how your favorite IPOs do throughout the tournament. Let us introduce the 2013 IPO Madness bracket!
NYSE Region
#1 Zoetis vs. #4 TRI Pointe Homes
Zoetis (ZTS), a spin-off of Pfizer's global animal health medicines and vaccines business, raised $2.2 billion on January 31. The company recorded a first day pop of 19% and is up 29% since its debut. It is the largest IPO since Santander (BSMX) listed in September 2012. TRI Pointe Homes (TPH) designs, constructs and sells single family homes in California. The company raised $233 million on January 31. It rose 12 % on its opening day of trading and currently stands at 17% above its offer price. Barry Sternlicht’s Starwood Capital holds a 45% stake in the company.
#2 CVR Refining vs. #3 Artisan Partners Asset Management
Artisan Partners Asset Management (APAM), an independent investment management firm focusing on US and global equities with $74 billion under management, raised $332 million on March 6. Its stock shot up 29% on its first day of trading and its total return sits at 26%. Its first-day gain was the best in at least 15 years for a pure-play, traditional asset manager. CVR Refining (CVRR), an LP with petroleum refining operations in Kansas and Oklahoma, raised $600 million on January 16. The company remained flat on its first day of trading but its total return is 42%. Aside from Zoetis, CVR is the largest IPO to-date in 2013.
Private Equity Region
#1 – Norwegian Cruise Line vs. #4 West Corp
Norwegian Cruise Line (NCLH), the third largest cruise line operator in North America, raised $447 million on January 17. Its stock recorded a first day pop of 31% and its total return is 58% since its debut, making it the fourth best return of 2013. Its private equity backers include Genting HK, Apollo, and TPG Capital. West Corp (WSTC) is a leading conferencing and call center provider. It raised $426 million on March 21, making it the fourth largest deal of the year. Its customers include 84% of the Fortune 500. Its private equity backers are Thomas H. Lee and Quadrangle.
#2 – Boise Cascade vs. #3 Bright Horizons Family Solutions
Bright Horizons Family Solutions (BFAM) is the leading provider of employer-sponsored child care with nearly 800 centers in the US and the UK/Netherlands. The company raised $222 million on January 24. It initially traded up 29% on its opening day and its total return stands at 61%, good for the second best total return in 2013. Bain acquired Bright Horizons in 2008. Boise Cascade (BCC) is a vertically integrated wood product manufacturer and building materials distributor. It raised $247 million on January 30. The stock had a first day pop of 25% and is up 60% since its debut, making it the third best IPO of 2013. Madison Dearborn is the primary private equity backer.
NASDAQ Region
#1 CyrusOne vs. #4 LipoScience
CyrusOne (CONE), a data center REIT carve-out from Cincinnati Bell, raised $314 million on January 17. CyrusOne had a first-day pop of 12% and its total return stands at 16%. To-date, it is the best performing REIT IPO. LipoScience (LPDX), a provider of LDL diagnostic test to assess cardiovascular disease risk, raised $45 million on January 24. Its first-day pop was 16% and that is also where its total return currently sits. It is the first diagnostics company to go public in over two years.
#2 ExOne vs. #3 Health Insurance Innovations
Health Insurance Innovations (HIIQ), which offers web-based short-term medical insurance for the uninsured and the underinsured, raised $65 million on February 7. It had a negative first-day return of -2%, and today it stands at a total return of -1%. ExOne (XONE), which provides 3D printing machines and printed products to industrial customers, raised $95 million on February 6. It had a first day pop of 47% and its total return stands at 70%. It is the best performing IPO in 2013 to-date.
Venture Capital Region
#1 Model N vs. #4 Marin Software
Model N (MODN), which provides revenue management software to the life science and technology sectors, raised $104 million on March 19. It had a first day pop of 29% and its total return sits at 24%. It was the first enterprise software company to go public in 2013. Marin Software (MRIN), which provides a cloud-based digital ad management platform that enables advertisers to analyze, automate and optimize primarily search ad campaigns, raised $105 million on March 21. Venture backers include Benchmark Capital Partners, DAG Ventures, Temasek Capital, Focus Ventures and Crosslink Ventures.
#2 Xoom vs. #3 Silver Spring Networks
Xoom (XOOM), an online and mobile money transfer company, raised $101 million on February 14. The company traded up 59% in the first-day but has had negative aftermarket performance resulting in a total return of 44%. It is the best performing VC-backed IPO in 2013 to-date. Silver Spring Networks (SSNI), which provides smart grid products and services to utilities, raised $81 million on March 12. The company had a first day pop of 29%, but traded down in the aftermarket, generating a total return to-date of 24%. The company only floated 10% of its proposed market value.
