Four IPOs raised $1.1 billion in the past week. Each deal traded up, and three popped 20% or more on the first day - a sign of "animal spirits" returning to the IPO market via MuleSoft, Canada Goose and Ardagh. On Friday, tech unicorn MuleSoft popped 46% in the year's best first-day, edging past Snap; the initial enthusiasm of tech IPO investors and a spate of technology filings signal that the sector is ready to make its comeback.
This week's outperforming IPOs were matched by strong market conditions. The IPO Index (IPOUSA) gained 1.0% this week. The VIX Volatility Index is well below historical levels, conducive to new offerings. The average return for last year's IPO class has improved to about +35%, with 71% above issue. The current year's 23 IPOs, up +13% on average, have raised $9.7 billion in proceeds - more than half of all of 2016.
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| 4 IPOs Priced During the Week of March 13 | |||||
| Issuer Business |
Deal Size ($mm) |
IPO Market Cap ($mm) |
Price vs. midpoint |
First day return |
Return at 3/17 |
| MuleSoft (MULE) |
$221 | $2,418 | 31% | 46% | 46% |
| Provides an API-based application integration platform to enterprise customers. |
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| Canada Goose (GOOS) |
$253 | $1,410 | 13% | 27% | 36% |
| Makes and sells technical high-end down-filled outerwear. |
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| Ardagh Group (ARD) |
$308 | $4,444 | 3% | 21% | 16% |
| Global provider of metal and glass containers for consumer packaged goods. |
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| ProPetro Holding (PUMP) | $350 | $1,209 | -20% | 4% | 4% |
| A leading provider of hydraulic fracturing services in the Permian Basin. |
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Mule rules: Tech unicorn MuleSoft gains 46% in year's highest pop
MuleSoft (MULE) priced above its upwardly revised range - a whopping 31% above the proposed midpoint - to raise $221 million. It finished its first day at $24.75; its stellar 46% pop is largely in line with other VC-backed tech IPOs since 2016. MuleSoft offered a unique growth story in a large market, with near breakeven cash flow. However, its low float ratio (9.1%) may have helped boost initial trading, and lead to near-term volatility. MuleSoft
Down is up: Bain's golden goose flies 36%
Canada Goose (GOOS) priced above its range and finished the first day up 27%, before rallying on Friday for a gain of 36%. High-growth consumer IPOs have been just as rare as tech, and Canada Goose's strong brand, fast expansion and profitability proved to be a recipe for success. Now it hopes to remain trendy in the US, while an online rollout and European expansion offer avenues for growth. Backed by Bain Capital, the maker of high-quality down-filled parkas dual listed in New York and Toronto.
Bottle rocket: Container maker gains 16%
Ardagh Group (ARD) raised $308 million by pricing slightly above the midpoint, before popping 21% on its first day. A global leader in manufacturing metal and glass consumer packaging, Ardagh offered a straightforward story, combined with high cash flow to pay down its enormous debt load. Owned by its Chairman, the company offered just 6.9% of its total share count, the lowest for a $200+ million IPO since 2014.
ProPetro (PUMP) raised $350 million by offering additional shares at $14, below the range of $16-$19, and traded up 6%. It's fully-utilized fleet of fracking units is attractively located in the Permian Basin, but the recent slide in oil prices - and the stock prices of peers like January IPO Keane Group (FRAC) - forced ProPetro to come public at a steep discount on EV/EBITDA.
More energy companies have already gone public in the first quarter than all of last year, and a surge of filers has filled the IPO pipeline. As ProPetro showed, that group now faces headwinds.
US IPO Pipeline update: Six IPOs filed, including four technology
Six new names joined the IPO pipeline this past week, tying the year's most active week for filings. More tech companies filed for IPOs this week (4) than we had seen year-to-date (3). Tech unicorn Okta (OKTA) filed for an estimated $150 million IPO, coming off a quarter with 80% growth. Yext (YEXT), a fast-growing provider of an online listing platform, filed to raise $100 million. Other notable US filings came from Brazilian e-commerce company Netshoes (NETS; $100 million), Texas bank Cadence Bancorporation (CADE; $100 million) and oilfield equipment company Solaris Oilfield Infrastructure (SOI).
IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. The Renaissance IPO Index is up 9.7% year-to-date, while the S&P 500 is up 6.2%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Ferrari (RACE) and TransUnion (TRU). The Renaissance International IPO Index is up 8.8% year-to-date, while the ACWX is up 8.2%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include Aena and ABN Amro. To find out if this is the best ETF for you, visit our IPO Investing page.
