The IPO Buzz: Blank Checks, Biotechs and Hope

Don’t look now, but there is nothing on this week’s IPO Calendar. For the IPO Calendar to go blank during March is unusual, but it has happened.

The last time this happened in March was in 2016. Nothing came to market during the week of March 14, 2016. But there were a few things that were of interest back then. They were blank checks, biotechs and hope. It is pretty much the same today.

In March 2019, blank checks are in play – again.

During the first week of March, four IPOs got priced – two blank checks plus a surgical device company and a Chinese online brokerage. And six companies filed plans to go public with the U.S. Securities and Exchange Commission. They expect to raise $734.25 million.

So the market is humming along quietly amid the headlines and the hope surrounding the IPO prospects for Lyft, Uber, AirBnB, Slack and a handful of other unicorns with big names. (A unicorn is a private company, typically a Silicon Valley start-up, with a valuation of $1 billion or more.)

People are waiting for Lyft (LYFT proposed) to announce its IPO terms. And they’re hoping for a flurry of IPO filings (public S-1 documents) by more unicorns with household names.

There were 327 unicorns with a total cumulative valuation of $1.08 trillion, as of January 2019, according to figures supplied by CBInsights.

Numbers Worth Noting

Let’s take time for a quick rewind. The non-blank check deals turned in a surprising IPO aftermarket performance last week. Here’s the rundown.

ShockWave Medical (SWAV) priced its IPO of 5.7 million shares at $17 each on Wednesday evening, March 6th. ShockWave opened Thursday, March 7th, at $24.80 on NASDAQ and closed its first day of trading at $30.50, up 79.4 percent from its IPO price. On Friday, March 8th, ShockWave closed at $31.61, UP 85.9 percent from its IPO price.

Shockwave Medical makes catheters and related products that use sonic pressure waves to break up calcified plaques in patients with coronary artery disease (CAD) and peripheral artery disease (PAD). The company adapted the technology used to treat kidney stones for over 30 years, the prospectus said.

Futu Holdings (FHL) priced its IPO of 7.5 million American Depositary Shares (ADS) at $12 each on Thursday evening, March 7th. Futu opened Friday, March 8th, at $14.76 on NASDAQ and closed its first day of trading at $15.32, UP 27.7 percent from its IPO price.

Futu operates an online brokerage with a social network for high-earning young Chinese investors. The clients’ average age is 35. Futu is backed by Tencent, China’s dominant Internet company.

Third Week of March

At press time, the IPO Calendar for the week of March 18th has just one deal – and yes, it’s a blank check offering. But anything can happen when the SEC’s filing window opens again for business on Monday morning.

Stay tuned.

Disclosure: Neither the author nor anyone else on the IPOScoop.com staff has a position in any stocks mentioned, nor do we trade or invest in IPOs. The author and IPOScoop.com staff do not issue advice, recommendations or opinion.