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Home furnishings retailer Restoration Hardware (NYSE:RH) gained 30% and two midstream energy LPs traded up during a shortened week for the US IPO market. All three deals priced on November 1, providing an encouraging start to what has been, on average, the most active month of the year for IPOs. With Hurricane Sandy forcing US stock markets to close for two days, three other previously scheduled deals were pushed back to next week.

Improved housing market boosts Restoration

Encouraging data on the US housing market has provided a lift to several home furnishings companies this year, including Pier 1 Imports (NYSE:PIR) (+48% YTD), Ethan Allen (NYSE:ETH) (+25%) and Williams-Sonoma (NYSE:WSM) (+21%). That fact, combined with 29% comparable store sales growth in the first half of 2012 and aggressive expansion plans, likely contributed to Restoration Hardware’s top-of-the-range pricing and strong first-day gain, the fifth highest for a consumer IPO in 2012. The previous housing-focused IPO, real estate brokerage franchisor Realogy (NYSE:RLGY), gained 27% in its market debut on October 11 and traded up another 5% on Friday, after reporting 11% revenue growth in the third quarter.

Midstream energy LPs continue run of success

Two midstream energy LPs, both offering high-single digit yields, also traded up on Friday. Southcross Energy Partners (NYSE:SXE), which owns natural gas pipeline assets, raised $180 million and gained 12%. Delek Logistics Partners (NYSE:DKL), which owns oil pipelines and related assets, raised $168 million and gained 6%. In the past two months, energy LPs have accounted for more than a fifth of IPO activity, and all seven LP deals are currently trading above their offer prices (+10% on average). The best performer of the group, MPLX LP (NYSE:MPLX), raised $381 million the previous week and trades 23% above its IPO price.

IPOs from less established companies push back pricings

Three companies, all early-stage or newly-formed, that were expected to price last week are now on this week's IPO calendar. Both Radius Health (NASDAQ:RDUS), a biotech focused on osteoporosis treatments, and Singulex (SGLX), which provides diagnostic testing for cardiovascular disease, are not expected to launch their major products until 2016. Although Singulex currently generates revenue from testing at its own facilities, it expects losses to continue for several years as it invests heavily in its sales force expansion and a next generation on-site system. Taylor & Martin Group (TMG), which aims to be a leader in the pre-owned capital asset auction and excess inventory markets, is a roll-up of five companies and accordingly has no combined operating history.

One company sets terms, three added to the US pipeline

Agricultural real estate REIT Gladstone Land (NASDAQ:LAND) set terms on Friday for a relatively small $50 million IPO. The two previous REIT IPOs have had mixed performance. Javelin Mortgage Investment (NYSE:JMI) ($145 million IPO), which invests in mortgage-backed securities, upsized its deal on October 2 but is currently trading just below its offer price (down -0.4%). Spirit Realty Capital (NYSE:SRC) ( $435 million IPO), which leases retail and restaurant properties, priced below the midpoint – but offered extra shares – on September 19 and has gained 11%.

On Thursday, Artisan Partners Asset Management (NYSE:APAM), an investment management firm with $64 billion in assets under management, revived its IPO aspirations by filing for a $250 million offering; the Milwaukee-based asset manager originally filed for an IPO in April 2011 before withdrawing those plans at the end of the year. Citigroup and Goldman Sachs are acting as joint bookrunners for the IPO. Artisan’s new filing followed the recent launch of a $55 million IPO by Silvercrest Asset Management (NASDAQ:SAMG), an investment management firm with $11 billion in AUM; Silvercrest aims to price its IPO the week of November 12.

Two profitable growth companies, both incorporated outside the US, also filed for US IPOs last week. UBIC (NASDAQ:UBIC), a Tokyo-based litigation services company with expertise in Asian-language electronic discovery and data forensics, filed for a $46 million IPO on Thursday. The company, which is currently listed on the Tokyo Stock Exchange, has seen its annual revenue jump from $14 million (FY March 2010) to $64 million (FY March 2012). Baird and William Blair are listed as underwriters.

Luxembourg-incorporated GFI Software S.A. (GFIX), which provides a suite of online collaboration, remote access, networking monitoring and security software for small- and medium-sized businesses, filed on Friday for a $100 million IPO. The company has seen its revenue grow from $50 million in 2009 to $120 million in 2011. For the six months ended June 2012, revenue increased 26% to $71 million. Because of upfront billings, GFI Software generated over $50 million in free cash flow in 2011. Insight Venture Partners and Bessemer Venture Partners own the majority of the company. J.P. Morgan, Credit Suisse and Jefferies are acting as joint bookrunners.

The US IPO pipeline now holds 129 companies looking to raise $38.3 billion. Of these, 54 have updated their filings within the past 90 days.

US IPO performance update

IPOs that have priced within the past 90 days have produced an average total return of 14% and an average aftermarket return (excluding first-day returns) of 2%. Of these 35 deals, 26 (74%) are trading above their offer prices. Year to date, there have been 121 IPOs, with an average total return of 17% and an average aftermarket return of 3%.

Source: Half Of U.S. IPOs Postponed But The Rest Perform Strongly