The IPO Buzz: Running with the Bulls

Wall Street closed Friday, Sept. 29, 2017, mostly at record highs. Two of the three major U.S. stock market indexes moved into the history books, and the IPO market was running with the bulls. Now for a quick look.

At the close on Friday, the last trading day of 2017’s third quarter:

  • The Dow Jones Industrial Average ended at 22,405.09, UP 13.37 percent for the year to date.
  • The S&P 500 Index closed at a record high of 2,519.36, UP 12.53 percent for the year so far
  • The NASDAQ Composite closed at a record high of 6,495.96, UP 20.67 percent for 2017 so far.
  • 2017’s IPOs ( scored an average gain of 26.03 percent from their initial public offering prices.

Year to date, the new-issue calendar had produced 102 IPOs in the first nine months of 2017, according to U.S. Securities and Exchange Commission filings. Of the 102 IPOs, 66 closed above their IPO prices, 35 below and one was unchanged as of Sept. 29.

In addition, September 2017 produced 15 deals – and that was better than “average.” From January 2001 through September 2017, the median average of all IPOs priced in September was 9.47 IPOs for the last 17 years. September 2017’s volume was UP 58.4 percent.

(Note: These figures exclude unit offerings, bank conversions, “best efforts” offering, Reg. A+ offerings that are usually “best efforts” offerings, blank checks, closed-end funds, companies trading on the pink sheets moving up to the NASDAQ and foreign-traded securities making their debuts in the U.S. capital markets. The latter are public offerings because investors can buy the underlying shares on foreign exchanges before their U.S. pricing dates.)

October’s Bounty

Moving on to October’s IPO calendar, we have five deals with expected pricing dates – three for this week and two for next. History is on the side of October’s IPO market. From January 2001 through October 2016, the month of October has a median average of 29.4 IPOs. That’s three times the median average volume for September over the last 17 years.

Here’s what is on tap for the week of Oct. 2, 2017:

Black Ridge Acquisition (BRACU – proposed), Rhythm Pharmaceuticals (RYTM – proposed) and Switch (SWCH – proposed).

Black Ridge Acquisition, based in Minneapolis, is a “blank check” or special purpose acquisition company (SPAC) focusing on upstream oil and gas investment opportunities. This is a unit offering.

Rhythm Pharmaceuticals, based in Boston, is a biopharmaceutical company developing peptide therapeutics to treat rare genetic disorders that lead to obesity. Its lead product candidate is Setmelanotide, a melanocortin-4 receptor agonist. It is in Phase III clinical trials for treating POMC deficiency obesity and leptin receptor deficiency obesity and Phase II clinical trials for treating Bardet-Biedl syndrome, Alström syndrome, POMC heterozygous deficiency obesity and POMC epigenetic disorders.

Switch, based in Las Vegas, operates three data centers offering colocation, connectivity, cloud computing and other related solutions. The company’s advanced data centers provide power densities that exceed industry averages with efficient cooling, while being powered by 100 percent renewable energy to more than 800 customers.

(For more information about these companies, please check the IPO profiles found on’s website.)

Deeper into October

The IPO calendar has two deals on it for the week of Oct. 9, 2017. Nevertheless, when the SEC opens its filing window again on Monday morning, anything can happen.

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.