US IPO Weekly Winners & Losers

On the surface, not much has changed since last week. There were no major IPO pricings or filings, and the calendar is nearly empty. The IPO market traded mostly flat.

Behind the scenes, we see green shoots, particularly from spin-offs, the energy sector, and biotechs. The CFO of J&J's Kenvue (NYSE: KVUE) hinted that an IPO is imminent. Natural gas compressor Kodiak Gas Services (NYSE: KGS) refreshed its filing. We’ve seen confidential filings (SeatGeek), executives discussing IPOs (Rippling), and pre-IPO fundraising (HeartFlow).

Each week also puts more distance between us and the banking crisis, which pushed back IPO timelines by months.

Six small companies priced US IPOs this week, raising only $11 million on average. Four came from China, including EV services firm U Power (Nasdaq: UCAR) which priced at the low end, popped +620%, and then crashed -82%. These “pop-and-drop” situations were a common theme last year until the regulator stepped in. The main takeaway here is that these micro-cap IPOs should result in… more micro-caps IPOs.

Blank check Ares Acquisition II raised $450 million, the largest SPAC IPO in over a year. The de-SPAC calendar has slowed, though new deals are still being announced. The most interesting one this week was an Abu Dhabi developer of “air-to-water technology” planning to go public via ATEK.

No major pricings in the week ahead. Last year’s biggest tech IPO, Mobileye (Nasdaq: MBLY), has a lock-up expiration on Monday. It closed Friday +112% above offer.

The IPO Index was off -0.4% this week, slightly below the S&P 500’s -0.1%. The top three IPO winners were all biotechs, with Prometheus Biosciences up +70.2% after Merck agreed to buy it for $200 per share, more than 10x its 2021 offer price. Crypto exchange Coinbase lost -15.5% amid pending SEC action and a dip in Bitcoin prices.