Pinterest (PINS) and Zoom Video Communications (ZM) – the two marquee deals on last week’s IPO Calendar – more than lived up to expectations. Pinterest popped for an opening-day gain of 28.4 percent, closing at $24.40, up from its IPO price of $19, and Zoom scored an opening-day gain of 72.2 percent, closing at $62, up from its IPO price of $36 – all on Thursday, April 18th. And that’s not all. Both were unicorns.
A unicorn is a privately owned company with a valuation of $1 billion or more. Note: There are now 341 unicorns in the pipeline with a total valuation of $1,149 billion, according to CBInsights.com.
When Pinterest priced its IPO of 75 million shares at $19 each on Wednesday evening, April 17th, its valuation was $10.1 billion, based on 529.4 million Class A and Class B shares outstanding. Based on its close at $24.40 on April 18, 2019, the valuation stood at $12.9 billion.
When Zoom priced its IPO of 20.9 million shares at $36 each on Wednesday evening, April 17th, its valuation was $9.24 billion, based on 256.6 million Class A and Class B shares outstanding. Based on its close at $62 on April 18, the valuation stood at $15.9 billion.
Blank Slate, Uber Fever
There are no IPOs on this week’s calendar, but all eyes are on the giant unicorn Uber Technologies (UBER proposed).
On April 11, the company filed its public S-1 for an IPO to raise $1 billion. No pricing terms were announced.
The world is waiting to see Uber’s cards: How many shares will it offer and what will the price range be? That will be in Uber’s S-1/A – and once the amendment is filed, investors will be able to determine the ride-share giant’s valuation. In the meantime, CBInsights.com lists Uber’s valuation at $72 billion. That’s still a lot of money.
The next question: When will the Uber S-1/A filing come? Uber filed its public S-1 on April 11th. The amendment could come any time – and when it does, the IPO circus will continue.
Riding in the Rain
But some rain fell on the unicorn parade last week. The news media reported two separate lawsuits were filed against Lyft (LYFT). If you recall, on March 28th, Lyft priced its IPO of 32.5 million shares at $72 each to raise $2.34 billion. At the time, the No. 2 U.S. ride-sharing company’s valuation was $20.6 billion, based on 285.9 million Class A and Class B shares outstanding.
The IPO soared to an intraday high at $88.60 during its opening day of trading on Friday, March 29th, but it broke issue price on Monday, April 1st, closing at $69.01. Since then, it has been a bumpy downward drift, with Lyft closing on Thursday, April 18th, at $58.36, down 18.9 percent from its IPO price. (The U.S. stock market was closed on April 19th in observance of Good Friday.)
This is where life gets interesting for the Lyft IPO. The quiet period ends Monday, April 22nd, and there are 20 underwriters waiting to release their research reports.
In the past, when lawsuits were filed against IPOs, underwriters generally refrained from issuing research.
We’ll have to wait and see whether history repeats itself.
Why keep a lid on research?
What is said in their research reports can and will be used against them.
Next Week: Nothing Yet
For the week of April 29, 2019, the IPO Calendar is clean and green. Nevertheless, anything can happen when the SEC’s filing window opens again for business on Monday morning.
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 opinions.