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Investors Care about Care.com; 40% First-Day Pop is Best of 2014

Posted
1/24/2014 5:52:00 PM
By: Renaissance Capital
Referenced Stocks:

The first technology IPO of the year also posted this year's best first-day gain. Care.com (CRCM), the largest online marketplace for family care, is the latest in a string of successful tech IPOs, with the previous five (NMBL, ATHM, WBAI, GOMO, ZU) posting an average return of 110%. In fact, of the nine other tech companies to go public during the past three months, all but one are trading 70% above their IPO price. However, IPOs in general have not fared as well this year. Excluding Care.com, the average first-day return has been a relatively weak 3%. Only one other IPO in 2014 (GlycoMimetics) managed to hit the average long-term first-day return of 11-13%. Especially impressive is Care.com's performance during the broad market sell-off of the last two days, which saw the stocks of many high-growth/internet names take a hit. Care.com raised $91 million on Thursday after pricing at $17 with an initial price range of $14 - $16.

Initial Public Offerings of 2014
Company Ticker Business  Deal Size
($mm)
First-Day
 Return
Total
 Return
Care.com CRCM Online family care marketplace $91 43% 43%
GlycoMimetics
GLYC Clinical-stage biotech  $56 13% 18%
Cypress Energy Partners LP CELP Energy Co. inspection services $75 7% 15%
Santander Consumer USA    SC Subprime auto loans  $1,800 5% 1%
Rice Energy RICE Natural gas E&P  $924 4% 4%
RSP Permian RSPP Oil and gas E&P  $390 3% 3%
CHC Group HELI Helicopters for oil/gas industry  $310 -2% -5%
EP Energy EPE Oil and gas E&P  $704 -10% -9%