US IPO Weekly Winners & Losers

Another week of high volatility, but this time with more winners than losers.

The IPO Index averaged a 5.0% swing each day this week, finishing up +7.1%, well ahead of the S&P 500’s +1.5%. That seems like the first good news in a while. However, we noted it’s too early to say whether this is the start of a rebound or the type of gyrations typical of a bear market.

We cautiously moved our IPO Pro market indicator up to “Cautious” on Tuesday.

Two biotechs priced this week, an industry where audited year-end results don’t matter much. The week’s sizable deal Arcellx (Nasdaq: ACLX) priced at the low end and gained a solid +12%.

The IPO calendar has filled up with a dozen or so micro-caps that may or may not price. Investors don’t necessarily need to see 12/31 results for these types of companies either. And it’s much easier to raise $20 million than $200 million.

SPAC activity is chugging along. Solid-state EV battery developer SES AI completed a deal that valued it at nearly $4 billion, though it ended the week about 30% below its $10 transaction price. Several small-cap mergers were announced this week, including pet services platform Wag and database software company MariaDB.

In the past few weeks, a number of multi-billion dollar companies have also inched closer to an IPO filing, including Discord, ServiceTitan, goPuff, Chime, and Cybereason. IPO investors may be optimistic by nature, but if we get more weeks like this, the market could easily open up in just a couple months.