Six US IPOs were able to raise $970 million last week including two $330 million + deals. Three IPOs offered double-digit first-day pops, including e-commerce platform ChannelAdvisor (32%), which continued a streak of ten consecutive enterprise software companies that have had a double-digit return on their first day (38% average). With last week's six pricings, 2013 now has the second most pricings through May (72) since 2000 (2007 had 86 through May and finished the year with 213). With two more deals slated to price before the month ends, May could reach 30 IPOs, a feat that has only been accomplished three times since 2003. The US IPO pipeline also remains active as four companies set terms and 12 submitted initial filings, including fast-casual restaurant chain Noodles & Company (NDLS) and former Icahn-backed WCI Communities (WCIC).
| IPO Pricings (week of May 20, 2013) | ||||
| Company (Ticker) | Business | Deal Size ($mm) | Price vs. Midpoint | Return |
| Alcobra (ADHD) | Early-stage biotech | $25 | -27% | -9% |
| ChannelAdvisor (ECOM) | E-commerce platform | $81 | 8% | 34% |
| Constellium (CSTM) | Aluminum manufacturer | $333 | -17% | -1% |
| Global Brass and Copper Holdings (BRSS) | Brass and copper distributor | $77 | -31% | 18% |
| Ply Gem Holdings (PGEM) | Exterior building products | $332 | 11% | 12% |
| Portola Pharmaceuticals (PTLA) | US homebuilder | $122 | 0% | 11% |
IPO pricing activity remains robust; enterprise software and housing’s strong returns continue
Six companies priced their IPOs last week, including Constellium (CSTM) and Ply Gem Hodlings (PGEM), which were both able to raise more than $330 million. Enterprise technology companies continues produce the strongest IPO returns with ChannelAdvisor (ECOM) returning 34% last week. ChannelAdvisor's on-demand platform, which enables customers to automate and manage sales across hundreds of online channels, processs over $3.5 billion in gross merchandise value. Global Brass and Copper (BRSS) was able to generate the week’s second best trading, up 18%, but only after pricing 31% below the midpoint.
Ply Gem Holdings, which has approximately 50% of revenue tied to new home construction, delivered a 12% return. Enterprise software and housing-related IPOs continue to be some of the best-performing with year-to-date. Enterprise software average return of 42% is well above the 2013 average total IPO return excluding enterprise software of 14%.
| IPOs setting terms (week of May 20, 2013) | |||
| Company (Ticker) | Business | Deal Size ($mm) | LTM Sales ($mm) |
| Aratana Therapeutics (PETX) | Pet medication biotech | $51 | $0 |
| Epizyme (EPZM) | Early stage biotech | $60 | $48 |
| LightInTheBox (LITB) | China-based online retailer | $79 | $236 |
| Regado Biosciences (RGDO) | Early stage biotech | $75 | $0 |
Chinese online retailer LightInTheBox and three biotechs added to calendar
Three companies set terms this week, including Chinese online retailer LightInTheBox (LITB). LightInTheBox has $236 million in LTM revenue ended March 31, 2013 and would mark the first Chinese company to list in the US since YY (YY) went public in November 2012. YY and Vipshop (VIPS) were the only two Chinese companies to list in the US last year, and are up 130% and 418% from their offer price, respectively. Three biotechs also set terms this week including, Artana Therapeutics (PETX), Regado BioSciences (RGDO) and Epizyme (EPZM). Epizyme has partnerships with Celgene, Eisai Co. and GlaxoSmithKline potentially worth $991 million.
| New IPO filers (week of May 20, 2013) | |||
| Company (Ticker) | Business | Deal Size ($mm) | LTM Sales ($mm) |
| Evoke Pharma (EVOK) | Early stage biotech | $23 | $0 |
| GDC Technology (GDCT) | Digital cinema server | $75 | $117 |
| Luxoft Holding (LXFT) | Software development services | $80 | $315 |
| NanoString Technologies (NSTG) | Diagnostic systems | $86 | $24 |
| Noodles & Company (NDLS) | Fast-casual restaurant | $75 | $312 |
| Physicians Realty Trust (DOC) |
Healthcare property REIT | $115 | $0 |
| Prosensa Holding (RNA) |
Early stage biotech | $60 | $11 |
| Rexford Industrial Realty (RXIR.RC) | Industrial REIT | $300 | $35 |
| Tremor Video (TRMR) | Video ad solutions | $86 | $113 |
| Waypoint Homes Realty Trust (WAY) | Single-family REIT | $100 | $0 |
| WCI Communities (WCIC) |
Florida home builder | $150 | $262 |
12 new filers brings May total to 23, sets a monthly high for 2013
Twelve companies filed initial registration statements for an IPO last week, bringing the total to 22 new filers for the month of May, easily surpassing the 11 new filers from May 2012. The combined 44 filers in April and May are the largest total for consecutive months since July and August of 2011, which had 56.
The week's notable filers included fast-casual restaurant chain Noodles & Company (NDLS), which operates over 300 fast-casual restaurants serving pasta bowls inspired by regional and worldwide cuisine. The company filed for a $75 million IPO on Thursday and has $312 million in LTM revenue. Its Chairman and CEO Kevin Reddy has extensive experience with casual restaurants, having served in senior management roles at McDonald's before joining Chipotle Mexican Grill as COO. Tremor Video (TRMR) also filed on Thursday and is looking to raise as much as $86 million. Tremor Video provides video advertising solutions to leading brand advertisers for Internet-connected devices. The company’s ad solutions are used on over 500 websites.
Another single-family foreclosure-to-rental REIT, Waypoint Homes Realty Trust (WAY), filed to raise up to $100 million. Waypoint marks the second REIT focused on single-family residential properties to file in May after Colony American Homes (CAHO.RC). American Residential Properties (ARPI) raised $288 million on May 8, but has traded off 4.7% from its offer price.
