The May IPO market storms into town with all the excitement and thrills of a Chinese New Year parade. There are eight deals on this week’s calendar and another seven for next week. Collectively, they could raise as much as $3.2 billion. And there’s more. The Street expects fireworks from some of those 15 names.
Renren (RENN) is an example of coming attractions.
The Beijing-based company is called China’s Facebook. Its prospectus has over 280 pages filled with all sorts of juicy details, but the most important, for the opening-day trader, is the front page.
That one gives the pricing terms of the deal.
Compare the final terms with the original terms and it will tell you all you need to know on how a deal will trade in the aftermarket. If it is priced above the original terms – expect a pop. “Increase a deal (in size), double my order” is the cliche that’s been around for decades.
Proof in the Pudding
From January 2010 through April 2011, 218 IPOs have been priced, according to U.S. Securities and Exchange Commission filings. Of that number, 49 were priced above their original filing ranges. They scored an average opening-day gain of 24.8%. The other 169 IPOs were priced within or below their filing ranges and scored an average opening-day gain of 4.83%.
And the size of Renren’s IPO has already been increased.
Renren plans to offer 53.1 million American Depositary Shares (ADS) at $12 to $14 each, up from $9 to $11 per share. (The company plans to offer 42.9 million ADS and selling shareholders plan to offer 10.2 million ADS.)
The Renren IPO is expected to be priced Tuesday evening, May 3, and to start trading on the New York Stock Exchange on Wednesday morning.
On Wall Street’s Shopping List
IPO pros say the Street’s “Most Wanted” list also includes the following:
Boingo Wireless (WIFI) is a Los Angeles-based provider of software to access the mobile Internet through high-speed, high-bandwidth Wi-Fi networks.
For the year ending Dec. 31, 2010, Boingo reported net income of $16.3 million on revenue of $80.4 million, compared with net income of $1.4 million on revenue of $65.7 million for the same period a year ago.
Boingo plans to offer 5.77 million shares at $12 to $14 each. (The company plans to offer 3.85 million shares and selling shareholders plan to offer 1.92 million shares.)
The Boingo IPO is expected to be priced on Tuesday evening and trade on the NASDAQ Global Market on Wednesday morning.
RPX Corporation (RPXC), based in San Francisco, owns over 1,500 intellectual property patents and licenses them to customers to prevent patent-infringement lawsuits.
For the year ending Dec. 31, 2010, RPX reported net income of $13.9 million on revenue of $94.9 million, compared with net income of $1.9 million on revenue of $32.8 million for the same period a year ago.
RPX plans to offer 7.3 million shares at $16 to $18 each.
The RPX IPO is expected to be priced on Tuesday evening and trade on the NASDAQ Global Market on Wednesday morning.
These are a few stories from this week’s calendar. There could be more “hot issues” coming out of China next week.
Disclosure: Neither the author nor anyone else on the IPOScoop.com staff has a position in any stocks mentioned, nor do they trade or invest in IPOs. The author and IPOScoop.com staff do not issue advice, recommendations or opinions.