U.S. IPO Week Ahead: Blue Jeans On The IPO Runway

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Includes: ALIT, DTIL, GHSI, LEVI, LYFT, TIGR, TUFN, TW
by: Renaissance Capital IPO Research
Summary

More than 30 years after it was taken private, Levi Strauss & Co. is returning to the public markets in the week ahead.

In total, four IPOs plan to raise about $1.4 billion in the IPO market - more than the year's 13 IPOs combined.

Another blank check company could list this week as well.

More than 30 years after it was taken private, Levi Strauss & Co. (NYSE:LEVI) is returning to the public markets in the week ahead. In total, four IPOs plan to raise about $1.4 billion in the IPO market - more than the year's 13 IPOs combined. Another blank check company could list this week as well.

U.S. IPO Calendar

Issuer
Business

Deal Size
Market Cap

Price Range
Shares Filed

Top
Bookrunners

Insurance Acquisition (NASDAQ:ILSUU)
Philadelphia, PA

$130M
$179M

$10
13,000,000

Cantor Fitz.

Blank check company backed by Cohen & Company and targeting the insurance industry.

UP Fintech Holding (TIGR)
Beijing, China

$78M
$873M

$5 - $7
13,000,000

Citi
Deutsche Bank

Online brokerage focused on global investors in China.

Levi Strauss
San Francisco, CA

$550M
$6,080M

$14 - $16
36,666,668

Goldman
JP Morgan

World's largest denim apparel brand.

Alight (ALIT)
Lincolnshire, IL

$752M
$4,807M

$22 - $25
32,000,000

BofA ML
JP Morgan

Blackstone-backed provider of outsourced cloud-based HR services.

Guardion Health Sciences (GHSI)
San Diego, CA

$8M
$90M

$4
1,875,000

WallachBeth
WestPark Capital

Sells medical food and devices for retinal diseases.

Levi plans to raise $550 million by offering shares at $14-$16; at the midpoint it would be valued at $6.1 billion IPO. The world's largest denim brand is going public with some strong tailwinds: the company grew 14% in 2018, its highest growth rate in 20 years. Management has improved gross margins to a 20-year high as well. While Levi has opened many new stores, it still relies heavily on wholesale customers.

Blackstone-backed HR services provider Alight plans to raise $752 million at a market cap of $4.8 billion ($7.3 billion enterprise value). The company grew just 3% in 2018, and it carries a lot of debt, but investors may be attracted to its position as a steadily growing business with expanding margins and most of the Fortune 100 as customers.

UP Fintech, also known as Tiger Brokers, is coming public immediately after its larger peer Futu Holdings (NASDAQ:FHL), up 50% from its US IPO in early March. UP Fintech is aiming to raise $78 million at a market cap of $873 million.

The week could also see IPOs from medical food and device company Guardion Health Sciences, on file for an $8 million offering, and Cowen-backed blank check company Insurance Acquisition.

Alight will be the year's largest IPO by deal size, and Levi will be the largest by market cap, but those records should soon be broken by Lyft (LYFT), which is expected to join the IPO calendar as early as Monday for end-of-month pricing. Gene edited CAR T biotech Precision BioSciences (DTIL) may also launch on Monday, while high-growth device maker Silk Road Medical (SILK), cybersecurity software seller Tufin (TUFN) and trading platform Tradeweb (TW) can come later in the week.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 3/14/19, the Renaissance IPO Index was up 30.6% year-to-date, while the S&P 500 had a gain of 12.6%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include VICI Properties (OTC:VICI) and Spotify (NYSE:SPOT). The Renaissance International IPO Index was up 8.8% year-to-date, while the ACWX was up 9.8%. Renaissance Capital's International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include SoftBank and China Tower.

Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.