The IPO market exhibited strong signs of life this week when
four companies were
able to price
, with three doing so above their initial ranges. Additionally,
all four companies are trading above their offer prices, a
positive trend given pricing pressures experienced by offerings
in the first half of this year. This week's strong returns have
also helped breathe new life into the entire IPO market, as
average aftermarket returns turned positive year-to-date.
Highly anticipated IPOs, firewall software provider Palo Alto
) and travel website operator KAYAK (
), which priced Thursday after the close, produced first day
returns of 27% and 28% respectively. However, the highest first
day returns this week belong to high-growth discount retailer,
Five Below, which returned 56% in its opening trading on Thursday
and gained an additional 3% on Friday. Biotech Durata
), which priced below its initial range, closed up 6% from its
offer price of $9.
reflects investor preference for high-growth business models,
particularly in the consumer and tech sectors. The only company
not to get its IPO offering completed, iconic guitar brand Fender
Musical Instruments (
), had the lowest growth prospects among this week's deals in
addition to a premium valuation.
Additionally, the performance should bode well for a score of
, including eight set to price next week and an additional three
that have set terms for the following week. Some notable
companies include Mexican restaurant chain Chuy's Holdings (
), organic grocer Natural Grocers (NGVC) and enterprise software
company E2open (EOPN).