Includes: GMRE, LN, SYRS, TWLO
While markets got a rough start to the week on the heels of the UK Referendum vote, both US and global markets rebounded sharply during the remainder of the week. The S&P 500 closed the week at 2,103, just ten points shy of its close before the vote. VC-backed Twilio (NYSE:TWLO) continued to trade well, now 127% above its IPO price. For the month of June, the IPO market priced 11 deals, and raised $829 million.
During the second quarter, IPOs of greater than $100 million returned 28%. For a more in depth look at the quarter, refer to our second quarter review.
| IPO Pricings Week of June 27, 2016 | |||||
| Issuer Business | Deal Size ($mm) | Market Cap ($mm) | Price vs. midpoint | First day return | Return at 7/1 |
| Global Medical REIT | $130 | $160 | -9.1% | +0.1% | +1.5% |
| Health care REIT with a portfolio of 12 facilities. | |||||
| Syros Pharmaceuticals | $50 | $302 | -16.7% | 45.2% | +54.8% |
| Developing gene expression therapies based on non-coding DNA research. | |||||
Global Medical REIT (OTCQB:GMRE) - Originally set to offer 9 million shares at a price of $10-$12, it priced an upsized 13 million shares at $10. Global Medical has an aggressive growth plan for 2017, which involves significant additional capital raises and targets an 8% dividend (not covered by the current portfolio). It is run by CEO David Young, who previously founded Windrose Medical Properties Trust which was acquired for $877 million in 2006. While there is execution risk in its growth plan, investors may be drawn to the prospect of the 8% dividend.
Syros Pharmaceuticals (Pending:SYRS) - Originally set to raise $60 million at the $14-$16 midpoint, Syros raised $50 million by pricing 4 million shares at $12.50. Despite pricing below the range, Syros closed its first day up 45%. It continued to trade well on Friday, up another 7%. While Syros's expansion on research into the non-coding DNA portion of the genome could lead to many indications, investors should be cognizant of the lack of human trial data and small patient populations, of approximately 12,000, being targeted initially. It is also important to note that Syros was supported by up to $35 million of insider purchases, or 75% of the deal, which could lead to additional volatility moving forward.
Initial filings during the week
Bioventus (BIOV) - Filed to raise $150 million. Bioventus offers non-invasive and surgical products for treatment of musculoskeletal conditions.
Yeti (YETI) - Filed to raise $100 million. Yeti manufactures and sells durable, high-end coolers and outdoor gear.
Kinsale Insurance (OTC:KNSL) - Filed to raise $100 million. Kinsale is a multi-line insurer providing specialty and property & casualty insurance.
Talend (TLND) - Filed to raise $86 million. Talend provides an open source data integration platform.
atomera (ATMR) - Filed to raise $18 million. atomera sells thin film reengineered silicon to enhance CMOS-type transistors.
Full Spectrum (FMAX) - Filed to raise $17 million. Full Spectrum develops and deploys private licensed wireless broadband networks.
Bioventus (BIOV) - Filed to raise $150 million. Bioventus offers non-invasive and surgical products for treatment of musculoskeletal conditions.
Yeti (YETI) - Filed to raise $100 million. Yeti manufactures and sells durable, high-end coolers and outdoor gear.
Kinsale Insurance (OTC:KNSL) - Filed to raise $100 million. Kinsale is a multi-line insurer providing specialty and property & casualty insurance.
Talend (TLND) - Filed to raise $86 million. Talend provides an open source data integration platform.
atomera (ATMR) - Filed to raise $18 million. atomera sells thin film reengineered silicon to enhance CMOS-type transistors.
Full Spectrum (FMAX) - Filed to raise $17 million. Full Spectrum develops and deploys private licensed wireless broadband networks.
The week also saw an update from Line (Pending:LN), which set terms to raise $1 billion.
IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. The Renaissance IPO Index is down 7% year-to-date, while the S&P 500 up 3%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Alibaba (NYSE:BABA), Synchrony Financial (NYSE:SYF) and Citizens Financial Group (NYSE:CFG). The Renaissance International IPO Index is down 9.9% year-to-date (as of Thursday's close), compared to -1.6% (also as of Thursday) for ACWX. Renaissance Capital's International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdingsinclude Recruit Holdings, NN Group and Aena S.A.
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. The Renaissance IPO Index is down 7% year-to-date, while the S&P 500 up 3%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Alibaba (NYSE:BABA), Synchrony Financial (NYSE:SYF) and Citizens Financial Group (NYSE:CFG). The Renaissance International IPO Index is down 9.9% year-to-date (as of Thursday's close), compared to -1.6% (also as of Thursday) for ACWX. Renaissance Capital's International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdingsinclude Recruit Holdings, NN Group and Aena S.A.
Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.
By Renaissance Capital IPO Research
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