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Investment Opportunities

Top Recent IPOs: New Investment Opportunities

Knowing recent IPOs is a great way to stay up to date on the IPO market. Initial public offerings can often provide great investment opportunities. But not always. Below is a short list of some of the top IPOs by month.

Recent IPOs: July

One of the top recent IPOs is Berkeley Lights, a biotech company.

Berkeley Lights (Nasdaq: BLI)

Berkely Lights is a biotech company. It develops and commercializes biotherapeutics. The company’s Beacon platform automates the cloning, culturing and sorting of cells from samples. As a result, it reduces both time and labor. Berkeley Lights’ platform is used by Pfizer (NYSE: PFE), Novartis (NYSE: NVS) and Teva Pharmaceuticals (NYSE: TEVA).

In 2019, total revenue was $56.7 million. This is an 81% increase from 2018, where revenue totaled $31.3 million. However, total operating expenses also increased from $44.3 million in 2018 to $60 million in 2019. That’s a 35.5% increase. But net loss decreased from $23.3 million in 2018 to $18.3 million in 2019.

Berkeley Lights filed to go public on June 26, 2020. And Berkeley Lights stock launched on the Nasdaq on July 16, 2020. The original price range was $19 to $20. But stock started trading at $22 a share. The company offered 8.1 million shares. The offering gave Berkeley Lights a market cap of $1.5 billion.

You can look at Berkeley Lights’ prospectus here.

First Day Return: +197.5%

nCino (Nasdaq: NCNO)

nCino is a cloud-based software company. It works with financial firms, such as banks and credit unions. The company’s Bank Operating System digitizes and streamlines work. It also uses data analytics, artificial intelligence and machine learning to improve the platform.

In 2019, total revenue was $91.5 million. This was an increase of 57.4% from $58.1 million in 2018. Unfortunately, nCino’s net loss also increased. In 2018, reported net loss was $18.6 million. In 2019, that number increased by 20% to $22.3 million.

nCino filed on June 22, 2020. It went public a few weeks later on July 13, 2020. The company offered 8.06 million shares. The original price range was $28-$29 but started trading at $31 a share. This gave nCino a market cap of $3.04 billion.

You can look at nCino’s prospectus here.

First Day Return: +195.5%

Lemonade (NYSE: LMND)

Lemonade is an American property and casualty insurance company. It offers renters and home insurance policies in the U.S. It also provides content and liability policies in Germany and the Netherlands. Lemonade is a vertically-integrated company. Its goal is to digitize the industry.

In 2019, Lemonade’s total revenue was $67.3 million. This is almost three times 2018’s revenue of $22.5 million. However, with this big growth in revenue also came higher expenses. Total expenses in 2018 were $75.1 million. But in 2019, expenses increased to $175.2 million. This led to a greater net loss of $108.5 million in 2019 compared to $52.9 million in 2018.

Lemonade filed with the SEC on June 8, 2020. Almost a month later, Lemonade stock started trading on July 1, 2020. The offer was for 11 million shares. The original price range was $26 to $28. However, stock began trading at $29 a share. The offering gave Lemonade a market cap of $1.6 billion.

You can look at Lemonade’s prospectus here.

First Day Return: +139.3%

ALX Oncology (Nasdaq: ALXO)

ALX is a clinical-stage immuno-oncology company. It helps patients by developing therapies to prevent cancer cells from using a protein to evade the immune system. The therapies use strategies to help leverage the body’s immune system. ALX hopes to advance its lead treatment, ALX148, into clinical development. It’s also working on a tumor-indicating treatment.

In 2018, ALX’s revenue was $2.1 million. This more than doubled in 2019 for a total of $4.8 million in revenue. Additionally, ALX’s net loss increased. In 2018, net loss totaled $13.7 million. But in 2019, that number increased by 40% to $19.25 million. If ALX’s revenue can outpace its growing expenses, the company can become profitable.

ALX filed to go public on June 26, 2020 and priced a couple weeks later on July 16, 2020. The offering consisted of 8.5 million shares. The original price range was $15 to $17. However, ALX stock began trading at $19 per share. ALX’s market cap was $730 million.

You can look at ALX Oncology’s prospectus here.

First Day Return: +57.9%

AlloVir (Nasdaq: ALVR)

Allovir is a clinical-stage cell therapy company. It develops T cell therapies to treat and prevent viral diseases. Allovir’s therapy aims to restore immunity in patients with T cell deficiencies. Many patients with a viral disease have limited or no therapy options. The company will enter its primary candidate into treatment trials in the fourth quarter of 2020.

Allovir’s financials are unique. In 2018, the company’s revenue was $1.1 million. Then in 2019, it decreased to $165,000. However, Allovir’s explains why in its prospectus:

“All of our revenue has been derived from our grant agreement with the Cancer Research and Prevention Institute of Texas, or CPRIT. In November 2019, we provided CPRIT with written notice of our intent to terminate the grant, and received acknowledgement in January 2020… To date, we have not generated any revenue from product sales. If our development efforts for our product candidates and preclinical programs are successful and result in regulatory approval, we many generate revenue in the future from product sales.”

As a result, Allovir’s net loss also increased from $2.4 million in 2018 to $23.8 million in 2019.

The company filed on July 6, 2020. It went public in the same month, pricing stock on July 29, 2020. The offering consisted of 16.25 million shares with an original price range of $16 to $18. Shares started trading at $17, the midpoint of its range. The offering gave Allovir a market cap of $1.1 billion.

You can look at Allovir’s prospectus here.

First Day Return: +49.4%

 

Recent IPOs: June

A Vroom IPO was confidentially filed with the SEC.

Agora (Nasdaq: API)

Agora is a China-based video, voice and live interactive streaming platform. The company’s goal is to help developers use real-time engagement to create innovative products, improve user experiences and build applications leading to the future of technology.

Agora has steady growth. Its 2018 sales were $44 million. And in 2019, sales were up for a 48% year-over-year growth at $64 million. Gross profit also increased with a 42% year-over-year growth from $31 million to $44 million.

The company filed to go public on the U.S. markets on June 5, 2020. Agora is one of the most recent IPOs, pricing on June 25 and trading June 26. The price range was $16 to $18. However, shares started trading at $20 a share. Agora raised $350 million for a market cap of nearly $5 billion.

You can look at Agora’s prospectus here.

First Day Return: 152.5%

Vroom (Nasdaq: VRM)

Vroom is an online car resale service. Founded in 2013, the company is headquartered in New York City. Vroom handles the process between buyer and seller instead of using a peer-to-peer model, like Craigslist. The company delivers nationwide and also offers financing through multiple banks.

In the fiscal year ended December 31, 2019, Vroom reported sales of just under $1.2 billion. This is a 39% year-over-year increase from 2018, when sales were $855 million. However, gross profit went down from $61 million in 2018 to $58 million in 2019.

Vroom confidentially filed to go public on May 18, 2020. A couple of weeks later, on June 8, the company priced its recent IPO. Originally, the price range was $18 to $20. But shares started trading at $22 a share for a deal worth $468 million. This gave Vroom a market cap of $6.8 billion.

You can look at Vroom’s prospectus here.

First Day Return: 117.7%

Forma Therapeutics (Nasdaq: FMTX)

Forma Therapeutics is a biopharmaceutical company. It develops and commercializes novel therapeutics to help patients with rare hematologic diseases and cancers. The company focuses on sickle cell disease and prostate cancer.

Forma has negative growth for sales. In 2018, $164 million in sales was reported. But in 2019, that number decreased to $101 million for a –39% growth rate. In its prospectus, Forma stated the company is not profitable and likely won’t be for the foreseeable future. Company sales depend on the commercialization of its products, which are required to undergo multiple tests and approvals.

The biotech company filed to go public on May 29, 2020, and quickly priced its recent IPO a couple of weeks later. Shares were priced at a range of $16 to $18 but started trading at $20 on June 19, 2020. Forma raised $278 million for a market cap of $1.9 billion.

You can look at Forma Therapeutics’ prospectus here.

First Day Return: 95%

ZoomInfo (Nasdaq: ZI)

ZoomInfo is an American business-to-business software as a service company. It sells access to an intelligence platform. This is a database of information about companies and business people for sales, marketing and recruiting professionals. The goal is to help clients find new potential customers.

In the fiscal year ended December 31, 2018, ZoomInfo reported sales of $144 million. But for 2019, the company reported a 103% year-over-year growth with $293 million in sales. Gross profit also had a large increase. In 2018, gross profit was $107 million. In 2019, that number increased by 103% to $225 million. However, the company has debt. Before the IPO, ZoomInfo had $1.2 billion in debt. After using IPO proceeds, that debt is now $842 million.

ZoomInfo filed for an IPO on February 27, 2020. It wasn’t until June 3 the company priced its recent IPO with a range of $19 to $20. Shares opened at $21 for a market cap of $19.3 billion.

You can look at ZoomInfo’s prospectus here.

First Day Return: 61.9%

Pliant Therapeutics (Nasdaq: PLRX)

Pliant Therapeutics is a biotech company. It’s focused on developing novel therapies to treat fibrosis. The company hopes to target a number of organs affected by fibrosis. That includes lung, liver, kidney, skin and muscle. Pliant hopes to start a Phase 2a trial in the second half of 2020 for its primary product. Its second product is currently in a Phase 1 trial. Pliant expects to give data by the end of 2020.

Founded in 2016, Pliant didn’t record sales until 2019. In 2019, sales were $57 million. And in the last 12 months to date, sales were $86 million. So Pliant is a profitable startup capable of growth.

Pliant filed with the SEC on May 11, 2020. It was priced on June 2 at a range of $14 to $16. Shares started trading at $16 on June 3 to raise $144 million. The company’s recent IPO gave Pliant a market cap of $1.1 billion.

You can look at Pliant Therapeutics’ prospectus here.

First Day Return: 33.1%

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