9 IPOs priced deals this week. This brings April’s total to 20, making it the busiest month of the past 22. These 20 pricings were almost enough to double the count for the year, raising that number to 45. Five biotechs priced in April, doubling the total for the year after just three biotechs priced in the 1Q17.
The deals this week included the best and worst first day returns of the year from non-biotechs with Floor & Decor (+53%) and Carvana (-26%), respectively.
| IPO Pricings Week of April 24th, 2017 | |||||
| Issuer Business |
Deal Size ($mm) |
Market Cap at IPO ($mm) |
Price vs. midpoint |
First day return |
Return at 4/28 |
| Floor & Decor (FND) |
$185 | $2,126 | +24% | +53% | +54% |
| Hard surface flooring and accessories retailer with 72 warehouse-format stores. |
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| Cloudera (CLDR) |
$225 | $2,514 | +15% | +21% | +21% |
| Provides a Hadoop-based data management platform to large enterprises. |
|||||
| NCS Multistage Holdings (NCSM) |
$162 | $809 | +3% | +18% | +18% |
| Provides well completion products and services in Canada and the US. |
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| Emerald Expositions Events (EEX) |
$264 | $1,271 | -11% | +15% | +15% |
| Largest US operator of B2B trade shows and exhibitions backed by Onex. |
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| Catasys (CATS) |
$15 | $60 | 0% | +8% | +7% |
| Provides substance abuse, depression and anxiety outpatient programs. |
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| China Rapid Finance (XRF) |
$60 | $335 | -43% | +7% | +7% |
| Operates an online marketplace in China for small peer-to-peer loans. |
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| Zymeworks (ZYME) |
$59 | $331 | -10% | 0% | 0% |
| Early-stage biotech developing bispecific antibodies that target HER2 tumors. |
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| Verona Pharma (VRNA) |
$80 | $167 | 0% | 0% | 0% |
| Developing inhaled treatments for respiratory diseases. |
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| Carvana (CVNA) |
$225 | $2,068 | 0% | -26% | -26% |
| Online used car retailer with locations featuring car "vending machines". |
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Floor & Decor (FND), a fast-growing warehouse-style retailer of hard flooring, raised $185 million after pricing above the proposed range and it went on to have the best first day of 2017, popping 53%. LBO'd by Ares and Freeman Spogli in 2010, FND has produced impressive 19% comp growth that combined with new store openings for 2016 revenue growth of 34% to reach $1.1 billion.
Cloudera (CLDR), which provides a Hadoop-based data management platform, raised $225 million after pricing above the range and was fairly well received, popping 21% on Friday. Cloudera was the year's fourth tech "unicorn" to go public; the prior three priced above the range and popped 38-46%. Cloudera’s more tempered debut is likely attributable to the immense scale of its losses bolstered by its growth at scale.
Carvana (CVNA), a high-growth online used car retailer, raised $225 million, but floundered in trading, falling 26% on Friday, marking the second-worst non-biotech first day in the last 10 years. Owned by its founder and CEO, Carvana achieved a 2-year sales CAGR of 196% to reach 2016 sales of $365 million (5% gross margin). Investors were likely off-put by the operating losses that ballooned to $90 million in the last year and the increasing online competition.
Emerald Expositions Events (EEX) raised $264 million (33% insider selling) in the largest deal of the week, though it priced below the range. LBO'd by Onex in 2013, the company has made a string of acquisitions to become the dominant US operator of B2B trade shows. It grew sales by 6%, about half organic, to $324 million in 2016, with adj. EBITDA of $152 million (47% margin).
NCS Multistage Holdings (NCSM) raised $162 million. Backed by Advent, this provider of well completion equipment and services saw revenue decline 14% to $98 million in 2016. With no post-IPO debt, it is poised to benefit from higher spending on energy production in the US and Canada, and investors bought into the rebound as NCS popped 18%.
China Rapid Finance (XRF), which operates an online marketplace in China for peer-to-peer loans, raised $60 million after slashing the price range of the offering by almost 40% earlier in the week. Net revenue ($56 million) and net income (-$33 million) declined in each of the past two years, even as loan volume tripled.
Zymeworks (ZYME), an early-stage biotech developing antibodies for cancer, raised $65 million by offering 4.5 million shares. Insiders, including Eli Lilly and Celgene, took 67% of the offering. Five other biotechs have IPO'd in 2017, and three are up 30% or more. The Vancouver-based company is now listed on the NYSE and the TSX.
Verona Pharma (VRNA) raised $80 million (22% from insiders) in a Nasdaq listing. It was already traded on London's AIM market (VRP). Insiders purchased less than the $23 million (38%) they originally indicated.
Catasys (CATS), a micro-cap substance abuse outpatient program provider, raised $15 million Wednesday in an uplisting to the Nasdaq after launching its deal on Monday.
IPO Market Snapshot
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