Six IPOs raised $1.2 billion this week, tied for the most active week of the year.
Yext (YEXT) was the latest in a series of high-growth, high-loss software companies to have well-received IPOs this year. Yext allows businesses to sync their customer-facing information, such as hours and menus, across the internet through its cloud-based platform. It priced above the high end of the range and closed Thursday up 22%. Investors were eager to fund Yext, which has experienced 30%+ revenue growth that it expects to continue for several years. Its backers include Institutional Venture Partners, Insight Venture Partners, Marker and Sutter Hill.
Netshoes (NETS), a Brazilian online retailer of shoes and sports apparel, priced at the bottom of its range and broke issue at open to finish down 10% on its first day and continued the slide Friday closing down 19%. Investors were likely turned off by its failure to grow profitability (adj. EBITDA was -2% of 2016 sales).
Led by JetBlue’s founder, Azul (AZUL) is the third-largest airline in Brazil. It completed its IPO on Monday after a short-lived suspension from Brazil’s regulator was lifted over weekend. It upsized its deal and raised $573 million, dual listing in the US and Brazil. It was the first airline to list in the US since Virgin America (VA) in 2014, which has since been acquired by Alaska Airlines.
Warrior Met Coal (HCC), which produces and exports metallurgical coal, raised $317 million. It opened down 8% after pricing at the top of the range, but reclaimed ground during the day to close down 5%. Warrior is the second public pure-play met coal producer after January IPO Ramaco Resources (METC), which is down 38% from its offer. No company has priced up and traded down since October.
Cadence Bancorporation (CADE), a Texas commercial bank with $10 billion in assets, raised $150 million and finished the day up 8%. It is the first bank to go public in the US since September 2016. Over the past twelve months, five regional banks have completed IPOs and averaged a 45% return after 4% first day pops.
Tocagen (TOCA) raised $87 million to continue its clinical trials as it develops gene therapies for brain cancer. Founded by serial entrepreneur Harry Gruber, Tocagen had no listed VC backers. It was the week's best IPO finishing up 25%. Three of the four 2017 biotech IPOs are up more than 20%.
Blank check company Vantage Energy Acquisition (VEACU) raised $480 million in an upsized deal. While we do not count SPACs in our IPO stats, SPACs have raised $2.7 billion through seven deals so far in 2017.
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| IPO Pricings Week of April 10th, 2017 | |||||
| Issuer Business |
Deal Size ($mm) |
Market Cap ($mm) |
Price vs. midpoint |
First day return |
Return at 4/13 |
| Yext (YEXT) |
$116 | $1,106 | +22% | +22% | +22% |
| Provides a platform that allows businesses to sync local listings across the internet. |
|||||
| Azul (AZUL) | $573 | $2,279 | 0% | +7% | +9% |
| Brazil's third-largest airline, founded by JetBlue founder David Neeleman. |
|||||
| Warrior Met Coal (HCC) | $317 | $1,018 | 6% | -5% | -5% |
| Metallurgical coal producer and exporter. |
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| Netshoes (NETS) | $149 | $559 | -5% | -11% | -19% |
| Leading shoe, fashion and beauty online retailer in Brazil. |
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| Cadence Bancorporation (CADE) | $150 | $1,663 | 0% | +8% | +8% |
| Commercial bank with 66 locations in Texas and the Southeast. |
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| Tocagen (TOCA) | $85 | $184 | -9% | +25% | +25% |
| Developing a combination gene therapy treatment for brain cancer. |
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IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. The Renaissance IPO Index is up 9.1% year-to-date, while the S&P 500 is up 4.0%. 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 9.2% year-to-date, while the ACWX is up 7.4%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include Covestro and ABN Amro. To find out if this is the best ETF for you, visit our IPO Investing page.
