The IPO market always gets off to a slow start in September. The delay is a seasonal factor caused by the Labor Day break. It usually takes until mid-month for the IPO market to come to life. It is happening now. The "Open for Business" sign was hung up on Wall Street's IPO window last week.
On Wednesday, Sept. 5, GlobeImmune (GBIM), a Louisville, Colorado-based biopharmaceutical company, filed an S-1/A amendment with the U.S. Securities and Exchange Commission (SEC) to offer 5 million shares at $11 to $13 each. Two days later, its bankers announced the IPO would be priced on Wednesday evening, Sept. 19.
And three other companies announced expected pricing terms.
The IPO calendar has come to life - and right on time.
From 2000 to the present, in six of the last 12 Septembers, SEC filings showed that bankers started pricing IPOs between Sept. 14 and Sept. 19 - just like this year. The earliest IPO pricing was on Sept. 5, 2006, and the latest was on Nov. 18, 2008.
On Sept. 5, 2006, New Oriental Educational & Technology Group (EDU), a China-based educational services provider, priced its IPO of 7.5 million American Depositary Shares at $3.75 each (adjusted for a 4-for-1 stock split on Aug. 19, 2011). The stock closed on Friday, Sept. 7, 2012, at $14.79 - UP 294.4 percent from its initial offering price.
The last four months of 2006 were good.
On Dec. 29, 2006, the Nasdaq Composite Index closed at 2,415.29 - UP 10.6 percent from 2,183.75 on Aug. 31. During that time, the calendar turned out 96 IPOs of the year's 201 IPOs, excluding unit offerings.
On Nov. 19, 2008, Grand Canyon Education (LOPE), a Phoenix, Arizona-based postsecondary educational services provider, priced its IPO of 10.5 million shares at $12 each. The stock closed on Friday, Sept. 7, 2012, at $22.77 - UP 89.8 percent from its initial offering price.
The last four months of 2008 were bad - very bad.
On Dec. 31, 2008, the Nasdaq Composite closed at 1,577.03, DOWN 33.4 percent from 2,367.52 on Aug. 29. During that time, the calendar turned out one IPO during the year's final four months - yes, just one - and it was the Grand Canyon deal.
Last Year's Start
Last year got off to a slow start. The first IPO to be priced after Labor Day 2011 was on Oct. 13. It was Ubiquiti Networks (UBNT), a San Jose, California-based provider of broadband wireless solutions. It priced its IPO of 7 million shares at $15 each. The stock closed on Friday, Sept. 7, 2012, at $12.03, DOWN 19.8 percent from its initial offering price.
The last four months of 2011 were a drag.
On Dec. 30, 2011, the Nasdaq Composite closed at 2,605.15, UP 1 percent from 2,579.46 on Aug. 31. During that time, the calendar turned out 27 IPOs of the year's 123 IPOs, excluding unit offerings.
Now back to the present - and this week's IPO calendar. It is clean and green - nothing, but it is building for the week of Sept. 17.
At press time, there are three deals on the calendar with expected trading dates, and one more company filed expected pricing terms on Friday afternoon. Its trading date is "to be announced" - hopefully by Monday.