The IPO Market Has Resumed Being On Fire With 11 New Deals

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Includes: AFGL, BE, CCB, DOMO, ECOR, ESTA, MYFW, RUBY, TLRY
by: Renaissance Capital IPO Research

After a short holiday break, the IPO market has resumed being on fire.

11 deals launched their offerings. 10 are on the calendar for next week, including 7 that plan to price on the night of Wednesday, July 18.

As expected, the biotech surge has continued into the third quarter with five new launches. 2018 healthcare IPOs have performed well, with biotech IPOs averaging a 21% return from the offer price. At a proposed $1.8 billion valuation, preclinical Rubius Therapeutics (NASDAQ:RUBY) is the largest company scheduled to go public. Two more healthcare companies also set terms: marijuana supplier Tilray (NASDAQ:TLRY) and breast implant maker Establishment Labs (NASDAQ:ESTA).

The largest upcoming IPO by deal size, oil and gas OEM AFG Holdings (NYSE:AFGL), plans to raise $300 million. With just one energy IPO in the 2Q18, AFG could signal a more active energy sector in the 3Q.

Two regional banks are the smallest IPOs on the calendar. WA-based Coastal Financial (NASDAQ:CCB) and CO-based First Western Financial (NASDAQ:MYFW) are each raising less than $40 million. The 21 regional bank IPOs since the start of 2016 average a 37% return, with 19 trading above issue.

Bloom Energy (NYSE:BE), valued at $3 billion in 2011, is going public at a proposed $1.7 billion valuation following a strong 2017 and 1Q18 for the fuel cell supplier. It plans to raise $252 million (20% from insiders).

U.S. IPO Calendar
Issuer
Business
Deal Size
Market Cap
Price Range
Shares Filed
Top
Bookrunners
Coastal Financial
Everett, WA
$38M
$166M
$13 - $15
2,720,000
KBW
Hovde Group
Community bank in Washington state.
Crinetics Pharmaceuticals
San Diego, CA
$80M
$380M
$15 - $17
5,000,000
JP Morgan
Leerink Partners
Clinical-stage biotech developing oral therapies for rare endocrine diseases.
AFG Holdings
Houston, TX
$300M
$1,347M
$15 - $18
18,200,000
Goldman
Credit Suisse
Oil and gas OEM specializing in pressure pumping and managed pressure drilling.
Allakos
San Carlos, CA
$96M
$738M
$15 - $17
6,000,000
Goldman
Jefferies
Developing antibodies for allergic, inflammatory and proliferative diseases.
Constellation Pharma
Cambridge, MA
$80M
$430M
$14 - $16
5,340,000
JP Morgan
Jefferies
Developing epigenetic cancer therapies that modulate abnormal genes.
Establishment Labs
Alajuela, Costa Rica
$50M
$321M
$15 - $17
3,125,000
Jefferies
Cowen
Fast-growing provider of silicone breast implants.
First Western Financial
Denver, CO
$37M
$153M
$19 - $21
1,850,000
KBW
Stephens
Denver, CO-based bank and wealth manager for high net worth individuals.
Rubius Therapeutics
Cambridge, MA
$200M
$1,795M
$20 - $22
9,530,000
JP Morgan
Morgan Stanley
Preclinical biotech developing novel therapies based on red blood cells.
Tilray
Nanaimo, Canada
$135M
$1,439M
$14 - $16
9,000,000
Cowen
Canadian vertically integrated supplier of medical cannabis.
Replimune Group
Woburn, MA
$101M
$500M
$14 - $16
6,700,000
JP Morgan
Leerink Partners
Developing oncolytic immunotherapies to fight solid tumors.
Bloom Energy
Sunnyvale, CA
$252M
$1,719M
$13 - $15
18,000,000
JP Morgan
Morgan Stanley

Sells clean energy power generators based on solid oxide fuel cell technology.

Side note
"Growth is good" has been the IPO market's mantra in recent months. That partly explains the initial 30% pops from growth deals Domo (NASDAQ:DOMO) and electroCore (NASDAQ:ECOR). However, both broke issue on Monday.