Growth IPOs are finally coming to market, and IPO investors are profiting.
ShockWave Medical ( SWAV ) priced above the range and jumped 79% on its debut, the best first-day pop since Elastic ( ESTC ) in October (+94%). While it is relatively early stage ($12mm in LTM sales), the company's cardiovascular device has shown advantages over competitors, and its products have seen strong initial traction since the mid-2018 launch.
Chinese brokerage Futu Holdings ( FHL ) raised $90 million and popped 28%. Futu profitably grew revenue by 160% in 2018 to $103 million, as Chinese retail demand for overseas securities takes off.
Two blank check companies also IPO'd this past week, raising a combined $490 million. These included cannabis-focused Tuscan Holdings (THCBU) and Crescent Capital-backed Crescent Acquisition (CRSAU). So far this year, 12 SPACs have raised $2.6 billion, compared to 14 other IPOs raising $1.4 billion. While 2019 IPO proceeds are down -88% from this point last year, 2019 SPACs have raised nearly 50% more than the YTD-2018 group, and 2018 was a 10-year record for SPACs.
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|4 IPOs During the Week of March 4th, 2019|
|ShockWave Medical ( SWAV )||$97M||$509M||13%||+79%||+86%|
|Sells medical systems used in treating cardiovascular disease.|
|Futu Holdings ( FHL )||$90M||$1,508M||9%||+28%||+28%|
|Fast-growing low-commission online broker age in China.|
|Tuscan Holdings (THCBU)||$240M||$298M||0%||+1%||+2%|
|Blank check company led by Stephen Vogel and targeting the cannabis industry.|
|Crescent Acquisition (CRSAU)||$250M||$313M||0%||+0%||+0%|
|Blank check company formed by Crescent Capital.|
Filings picked up this week as five IPOs joined the pipeline. Three stand out: Tradeweb
(TW) is a highly profitable company with 20% growth, medical device maker Silk Road Medical
(SILK) had 142% growth in 2018 ($35mm in sales), and Tufin Software
(TUFN) boasts 30% growth and a positive EBITDA margin.
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|6 Filings During the Week of March 4th, 2019|
|Iswill Acquisition (IWAC.U)||$230M||SPAC||Cantor Fitz.|
|SPAC led by former Virtustream executives targeting the software and internet industries.|
|Tradeweb Markets (TW)||$500M||Financials||JP Morgan|
|Electronic trading platform backed by Blackstone and Thomson Reuters.|
|Ruhnn Holding (RUHN)||$200M||Technology||Citi|
|E-commerce platform used by Chinese internet celebrities to sell fashion items.|
|Tufin Software (TUFN)||$100M||Technology||JP Morgan|
|Provides enterprise software for managing network security policies.|
|Blue Hat (BHAT)||$18M||Technology||ViewTrade|
|AR entertainment platform creating interactive children's toys and games.|
|Silk Road Medical (SILK)||$86M||Health Care||JP Morgan|
|Sells medical devices to treat carotid artery disease.|
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 3/7/19, the Renaissance IPO Index was up 26.8% year-to-date, while the S&P 500 had a gain of 10.1%. Renaissance Capital's IPO ETF ( IPO
) tracks the index, and top ETF holdings include VICI Properties (VICI) and Altice (ATUS). The Renaissance International IPO Index was up 8.0% year-to-date, while the ACWX was up 8.9%. Renaissance Capital's International IPO ETF ( IPOS
) tracks the index, and top ETF holdings include SoftBank and China Tower.
The article US IPO Weekly Recap: Two growth IPOs pop
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.