LinkedIn (LNKD) took a leap into legend last week with a moonshot. The IPO skyrocketed for a 109.4 percent opening-day gain. You could almost hear eyeballs popping in Silicon Valley and hearts beating faster with anticipation of another wave of “insanity-dot-com” sweeping over the IPO calendar. And that set the stage for this week.
Bankers plan to offer a robust calendar with eight deals looking to raise nearly $3.3 billion. And the centerpiece is – fittingly - an Internet company.
Yandex N.V. ((YNDX)) is called Russia’s Google (GOOG). Founded in 1997, the company has about 2,700 employees. It reported net income of $148 million on revenues of $503.1 million for the 12 months ended March 31, 2011.
Yandex plans to offer 52.2 million shares at $20 to $22 each to raise about $1.1 billion.
The IPO is expected to be priced Monday evening to begin trading Tuesday, May 24, on the NASDAQ Global Market under the proposed symbol “YNDX.” Joint-lead managers are: Morgan Stanley (MS), Deutsche Bank Securities (DB) and Goldman Sachs (GS).
(Note: The company plans to offer 15.4 million shares and selling shareholders plan to offer 36.8 million shares.)
With the LinkedIn joyride dominating last week’s news, it should come as no surprise that the Street reportedly has the Yandex IPO high on its “most wanted” list.
Now vs Then
Should the Yandex deal fly, the financial media will be having another field day reporting about the second coming of another IPO Internet bubble.
But there’s a major difference between today and yesteryear.
LinkedIn is a real company. Yandex is a real company.
Looking back to the 1999-2000 Internet bubble, any 20-something kid could hatch a cockamamie idea with no business plan, other than to burn capital, and the company would be rushed on to the IPO calendar. It worked. In 1999, the average opening-day gain for an IPO was 77 percent.
Note: In 2011, the average opening-day gain for an IPO has been 13.8 percent.
A normal weekly IPO calendar in 1999 would list about 20 deals and 15 would be Internet companies; none had revenues, but all reported millions and millions of dollars in losses.
We were there and reported it.
Anatomy of a Moonshot
In contrast, let’s step back to last week and recap the LinkedIn IPO.
LinkedIn priced its IPO at $45 per share, saw it open at $83 on Thursday and zoom as high as $122.70 before closing its first day of trading at $94.25 -- UP 109.4 percent from its initial offering price.
Founded in 2003, LinkedIn has about 1,300 employees. The social-networking company, which is popular with professionals and job-hunters, reported net income of $15.6 million on revenues of $295.3 million for the 12 months ended March 31, 2011.
Worth repeating: LinkedIn of Mountain View, California, is a real company. Yandex of Moscow is a real company.
When LinkedIn’s debut was wrapped in a burst of glorious California sunshine, you know that even pallid young investment bankers took notice. But instead of waxing their surfboards, they’re already burning the midnight oil to work on the IPOs that are likely to follow: Facebook, Twitter, Groupon and Zynga. (And yes, worth noting: These are all real companies.)
Chips and Trips
Here are a couple of other deals on this week’s IPO calendar that could attract some attention:
Freescale Semiconductor Holdings I, Ltd. (FSL) based in Austin, Texas, believes it is the global leader in embedded processing semiconductors and solutions. Founded in 2006, the company has about 18,500 employees. Freescale Semiconductor reported a loss of $944 million on revenues of $4.6 billion for the 12 months ended March 31, 2011.
Freescale plans to offer 43.5 million shares at $22 to $24 each to raise about $1.1 billion.
The IPO is expected to be priced Wednesday evening and begin trading on Thursday, May 25, on the New York Stock Exchange under the proposed symbol “FSL.” Joint-lead managers are: Citi (C), Deutsche Bank Securities (DB), Barclays Capital (BCS), Credit Suisse (CS) and JPMorgan (JPM).
Spirit Airlines, (SAVE) based in Miramar, Florida, is an ultra low-cost, low-fare airline providing affordable travel opportunities to and from South Florida, the Caribbean and Latin America serving 40 airports. Founded in 1964, the company has about 2,400 employees. The company reported net income of $69.1 million on revenues of $829.9 million for the 12 months ended March 31, 2011.
Spirit Airlines plans to offer 20 million shares at $14 to $16 each to raise $300 million.
The IPO is expected to be priced Tuesday evening and begin trading on Wednesday, May 25, on the NASDAQ Global Market under the proposed symbol “SAVE.” Joint-lead managers are: Citi and Morgan Stanley.
After this week, comes the Memorial Day holiday and the IPO market will hit a “normal” speed bump. At press time, there are no deals on the calendar for the week of May 30th.
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.