The IPO Buzz: Riding the Wave

IPO bankers and their clients looked like hotdog surfers riding the big wave last week, based on the activity at the U.S. Securities and Exchange Commission’s filing window.

Seven companies filed plans to go public. They aim to raise over $800 million. That is the most since early October.

The momentum, of course, is coming from the U.S. stock market’s post-election rally. The major U.S. stock indexes reached for the stars, though utility stocks and U.S. Treasury bonds pulled back – and the IPO market kept a low profile with just one deal getting done. (Only two IPOs are expected this week, when many of Wall Street’s denizens will head out early for a long Thanksgiving weekend. For details, see below.)

Early last week, the Dow Jones Industrial Average closed at back-to-back record highs on Monday and Tuesday. The Dow ended the week up just 0.1 percent after scoring a 5.4 percent gain the previous week – its best showing in five years. The Dow has climbed 2.9 percent since Election Day on Nov. 8. On Friday, Nov. 18, the Standard & Poor’s 500 Index was up 0.8 percent for the week. Since Election Day, the S&P 500 has gained 2 percent.

The Nasdaq Composite Index, the barometer of the IPO market, set an intraday record high on Friday and then retreated to close slightly lower. For the week, the Nasdaq was up 1.6 percent. Since Election Day, the Nasdaq has advanced 2.5 percent.

Get a Room

Among the new faces at the SEC’s filing window in the past week was the holding company for Trivago, the popular online platform that helps travelers compare hotel quality and room prices.

Trivago’s parent – travel B.V. (TRVG – proposed) – filed plans to go public and raise an estimated $400 million. The number of shares was not provided. No price range was given. The lead managers are J.P. Morgan, Goldman Sachs and Morgan Stanley.

On the Radio

And a July 7th filing came to life in a big way. It was CBS Radio (CBSR – proposed). The old filing named no underwriters, but the Nov. 18th filing did. The underwriting team consists of four joint-lead managers and 21 co-managers. The number of shares was not given and no price range was stated.

CBS Radio is, of course, the historic home of legendary reporter Edward R. Murrow, who brought World War II into America’s living rooms with his broadcasts from the rooftops during the Blitz of London.

Fast forward to 2016: CBS Radio describes itself as “a large-market-focused, multi-platform national media company with a local footprint of 117 radio stations and digital properties in 26 radio markets, including all of the Top 10 radio markets and 19 of the Top 25 radio markets.” The company owns 1010 WINS in New York. But there will be more on this later.

Thanksgiving Lite

Only two IPOs are on the calendar for this week, which will be cut short by Thanksgiving Day on Thursday. One name has generated some headlines because of the nature of its business:

Innovative Industrial Properties (IIPR – proposed)is focused on the acquisition, ownership and management of specialized industrial properties leased to experienced state-licensed operators for their regulated medical-use cannabis facilities.

Nevertheless, anything could happen when the U.S. Securities and Exchange Commission’s filing window opens for business on Monday morning.

Stay tuned.


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