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US IPO Week Ahead: On track for 7 IPOs, led by Virgin Trains USA


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Railroad IPOs were hot in the 1850's, but two billionaires are bringing the industry back this week with an offering of Virgin Trains USA. In total, the week could see up to seven deals, but Virgin Trains USA's $510 million IPO is larger than the other six combined. These others are mostly small healthcare IPOs: The IPO calendar has three biotechs, a medical device maker, a gene-edited crop company, and a Florida bank.

Even if the US government fails to avoid another shutdown by Friday, these seven should be the last to price for a few weeks, based on normal seasonality. Last year, the IPO market had a blackout period between 2/15 and 3/7. In a normal market, we would expect an uptick in initial filings starting on Monday, which would enable companies to go public in the first week of March.

U.S. IPO Calendar
Issuer
Business
Deal Size
Market Cap
Price Range
Shares Filed
Top
Bookrunners
Anchiano Therapeutics ( ANCN )
Jerusalem, Israel
$35M
$96M
$14.55
2,400,000
Oppenheimer
Phase 3 biotech developing therapies for early-stage bladder cancer.
BankFlorida (BFL)
Palm Beach Gardens, FL
$42M
$51M
$9.50 - $10.50
4,200,000
B. Riley FBR
Community bank with one branch in Southern Florida.
Virgin Trains USA ( VTUS )
Miami, FL
$510M
$2,985M
$17 - $19
28,334,000
Barclays
JP Morgan
Owns and operates an express passenger rail system in Florida.
Avedro ( AVDR )
Waltham, MA
$75M
$290M
$14 - $16
5,000,000
BofA ML
JP Morgan
Sells ophthalmic medical systems used in treating corneal disorders.
Cibus (CBUS)
San Diego, CA
$100M
$350M
$14 - $16
6,666,667
Morgan Stanley
BofA ML
Developing gene-edited crop traits for the global seed industry.
TCR2 Therapeutics (TCRR)
Cambridge, MA
$75M
$374M
$14 - $16
5,000,000
Jefferies
Leerink
Early stage biotech developing immunotherapies for various cancers.
Stealth BioTherapeutics (MITO)
Newton, MA
$81M
$430M
$12 - $14
6,200,000
Jefferies
Evercore ISI
Phase 3 biotech focused on mitochondrial dysfunction.


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Virgin Trains USA ( VTUS ) is targeting $510 million at a market cap of $3.0 billion. Founded by Fortress's Wes Edens and licensing Richard Branson's famous brand, the high-speed passenger rail company began service in Florida during January 2018, and booked roughly $10 million in revenue during the year. Like Fortress's recent energy IPO (NFE), Virgin Trains USA is an ambitious undertaking that will require billions of capex.

Stealth BioTherapeutics (MITO) is raising $81 million at a market cap of $430 million. Controlled by China's Morningside Venture, insiders have indicated on 74% of the deal. The company is in a Phase 3 trial for primary mitochondrial myopathy, a rare disease with no approved therapies.

TCR2 Therapeutics (TCRR) is targeting a $75 million IPO, including 40% insider interest. Primary backer MPM Capital was also behind this past week's T cell cancer biotech, Harpoon, which received a lukewarm reception on its debut (-3%). TCR2's IND was cleared by the FDA in January, and it is now ready to begin testing in humans.

Backed by OrbiMed, Avedro ( AVDR ) is raising $75 million to fund commercialization of its ophthalmic medical system used to treat eye disorders and improve vision. Fast growing medical device IPOs delivered strong first-day returns last year, and while Avedro's 24% growth (+55% in the US) is a key selling point, that was a result of higher drug pricing but lower device sales, and the company remains highly unprofitable.

Cibus (CBUS) is raising $100 million at a market cap of $350 million as it advances what it believes is a faster, more efficient method of developing desirable crop seed traits. Its gene-edited seeds are non-GMO, and last year it began marketing a herbicide-tolerant canola seed ($2.4 million in recorded sales), with plans to develop additional traits and seed types.

IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 2/7/19, the Renaissance IPO Index was up 19.3% year-to-date, while the S&P 500 had a gain of 8.1%. Renaissance Capital's IPO ETF ( IPO ) tracks the index, and top ETF holdings include VICI Properties (VICI) and Spotify (SPOT). The Renaissance International IPO Index was up 4.2% year-to-date, while the ACWX was up 7.0%. Renaissance Capital's International IPO ETF ( IPOS ) tracks the index, and top ETF holdings include SoftBank and China Tower.

The article US IPO Week Ahead: On track for 7 IPOs, led by Virgin Trains USA originally appeared on IPO investment manager Renaissance Capital's web site renaissancecapital.com.

Investment Disclosure: The information and opinions expressed herein were prepared by Renaissance Capital's research analysts and do not constitute an offer to buy or sell any security. Renaissance Capital's Renaissance IPO ETF (symbol: IPO) , Renaissance International ETF (symbol: IPOS) , or separately managed institutional accounts may have investments in securities of companies mentioned.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.





This article appears in: News Headlines , IPOs
Referenced Symbols: IPO , IPOS , ANCN , VTUS , AVDR



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