Last week marked a nice sigh of relief for private companies and investors alike. A string of successful IPOs marked the most successful new stock offerings since Facebook stumbled out of the gate. In the last week (ending 07/20/12) all four companies that went public traded above their offer price on their first day of trading. Here is a look at those four companies:
- Five Below (FIVE) – Free FIVE Analysis Here
Offer Price: $17.00
1 Day Close: $26.50
Return: 55.9%
Five Below is the owner of retail stores that sell all products for $5 or under. The company has seen tremendous growth in store counts and same store sales. Five Below hopes to have 2000 stores in the United States within 20 years. Stores target teenagers aged 5-19.
- Durata Therapeutics (DRTX) – Get Daily DRTX Analysis Here
Offer Price: $9.00
1 Day Close: $9.04
Return: 0.4%
Durata priced its shares below initial price ranges, but still saw a small increase at the end of its first trading day. The company targets fighting infectious diseases. Durata has two Phase III trials for bacterial and skin infections.
- Kayak Software (KYAK) – Get Daily KYAK analysis here
Offer Price: $26.00
1 Day Close: $33.18
Return: 27.6%
Kayak is a huge travel search engine that compares flights, hotels, car rentals, cruises, and vacation packages. The company has competition in the travel industry, but has been growing market share.
- Palo Alto Networks (PANW) – Get Daily PANW Analysis Here
Offer Price: $42.00
1 Day Close: $53.13
Return: 26.5%
Palo Alto is an internet security firm that helps create firewalls for businesses.
The one blemish on the week was legendary guitar maker Fender withdrawing its IPO, citing market conditions. The company has large exposure to European woes and has seen its growth in the United States mature. Investors weren’t lining up to get into shares of the guitar leader. Investors may also have backed away from Fender as they saw other great growth companies going public in the same week. Time will tell if Fender decides to come back and test the public markets.
Back in May, the highly anticipated IPO of Facebook arrived on the public markets. The company saw huge demand for its shares prior to the IPO, and raised its offering price as a result. Brokers saw huge demand for shares of Facebook that caused servers to crash and orders that had been cancelled to go through. Nasdaq and Morgan Stanley are still in a mess trying to compensate investors who saw huge losses.
There are eight scheduled IPOs to price this week. They include:
- AmReit (AMRE) – Houston based Real Estate Investment Trust
- Avast Software (AVST) – antivirus software for home and business use
- Chuys Holdings (CHUY) – restaurant chain
- Del Friscos Restaurants (DFRG) – restaurant chain
- E2open (EOPN) – software company
- Hyperion Therapeutics (HPTX) – therapeutic company with drugs aimed at urea cycle disorders and hepatic encephalopathy
- Natural Grocers (NGVC) – natural and organic food grocer in 12 states
- Northern Tier Energy (NTI) – refining company in Minnesota, with ownership of 166 convenience stores as well
On the success of the IPOs last week, the markets are likely to have a busy week if all eight companies price and trade this week. One thing is for sure, the markets are welcoming IPOs for the first time since Facebook. Long time investors knew that IPOs would eventually come back, but it appears to be sooner than Wall Street had expected.
Many Facebook investors were new to IPOs or first time investors to begin with. Many investors are counting on that first day bounce in the share price. If last week’s IPO market is any indication, perhaps the IPO bounce has returned.