U.S. IPO Week Ahead: Tradeweb Is The Hot Trade In A 4-IPO Week

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Includes: GNFT, LYFT, NGM, RUHN, SILK, TW
by: Renaissance Capital IPO Research
Summary

Four IPOs are scheduled to raise nearly $1.0 billion in the week ahead.

Electronic trading platform Tradeweb Markets is the week's largest deal, accounting for about 70% of the week's proceeds.

Silk Road Medical could see a lot of interest, based on its fast growth and the returns of recent IPO device maker ShockWave Medical.

Four IPOs are scheduled to raise nearly $1.0 billion in the week ahead.

Electronic trading platform Tradeweb Markets (NASDAQ:TW) is the week's largest deal, accounting for about 70% of the week's proceeds. The other three offer growth potential, but Tradeweb combines strong growth (+22% y/y) with profits (23% net margin), throwing off $235 million in free cash flow during 2018.

Silk Road Medical (NASDAQ:SILK) could see a lot of interest, based on its fast growth (+142% in 2018 on $35 million of sales) and the returns of recent IPO device maker ShockWave Medical (SWAV; +100% from IPO).

Ruhnn Holding (NASDAQ:RUHN) calls itself the "largest internet key opinion leader (KOL) facilitator in China." It identifies online influencers and allows them to monetize their fame through online stores. The company is not yet profitable, and sales grew 14% in the nine months ended December 31, 2018.

NGM Biopharmaceuticals (NASDAQ:NGM) is the latest billion-dollar biotech, attempting tor raise $100 million at a valuation of $1.1 billion. Like this past week's Genfit (NASDAQ:GNFT), NGM is targeting NASH, among other diseases.

U.S. IPO Calendar

Issuer
Business

Deal Size
Market Cap

Price Range
Shares Filed

Top
Bookrunners

Ruhnn Holding
Hangzhou, China

$125M
$1,034M

$11.50 - $13.50
10,000,000

Citi
UBS

E-commerce platform used by Chinese internet celebrities to sell fashion items.

NGM Biopharmaceuticals
South San Francisco, CA

$100M
$1,069M

$14 - $16
6,666,667

Goldman
Citi

Phase 2 biotech developing therapies for NASH and Type 2 diabetes.

Silk Road Medical
Sunnyvale, CA

$75M
$513M

$15 - $17
4,687,500

JP Morgan
BofA ML

Sells medical devices to treat carotid artery disease.

Tradeweb Markets
New York, NY

$682M
$5,645M

$24 - $26
27,268,768

JP Morgan
Citi

Electronic trading platform backed by Blackstone and Thomson Reuters.

NGM Biopharmaceuticals, a Phase 2 biotech developing therapies for NASH and Type 2 diabetes, plans to raise $100 million by offering 6.7 million shares at a price range of $14.00 to $16.00. The Column Group intends to purchase $30 million of the IPO (30% of deal) and Merck plans to invest $62 million in a concurrent private placement. At the midpoint of the proposed range, it would command a market value of $1.1 billion. NGM Biopharmaceuticals, which was founded in 2007, booked $109 million in revenue over the last 12 months. The South San Francisco, CA-based company plans to list on the Nasdaq under the symbol NGM. Goldman Sachs, Citi and Cowen are the joint bookrunners on the deal.

Ruhnn Holding, an e-commerce platform used by Chinese internet celebrities to sell fashion items, plans to raise $125 million by offering 10.0 million shares at a price range of $11.50 to $13.50. Weibo (NASDAQ:WB) intends to purchase up to $10 million of the IPO (8% of the deal). At the midpoint of the proposed range, Ruhnn would command a market value of $1.0 billion. Ruhnn Holding, which was founded in 2016, booked $156 million in sales over the last 12 months. The Hangzhou, China-based company plans to list on the Nasdaq under the symbol RUHN. Citi and UBS Investment Bank are the joint bookrunners on the deal.

Silk Road Medical, which sells medical devices to treat carotid artery disease, plans to raise $75 million by offering 4.7 million shares at a price range of $15.00 to $17.00. Insiders intend to purchase up to $15 million of the IPO (20% of the deal). At the midpoint of the proposed range, it would command a market value of $513 million. Silk Road Medical, which was founded in 2007, booked $35 million in sales over the last 12 months. The Sunnyvale, CA-based company plans to list on the Nasdaq under the symbol SILK. J.P. Morgan and BofA Merrill Lynch are the joint bookrunners on the deal.

Tradeweb Markets, an electronic trading platform backed by Blackstone and Thomson Reuters, plans to raise $682 million by offering 27.3 million shares at a price range of $24.00 to $26.00. At the midpoint of the proposed range, it would command a market value of $5.6 billion. Tradeweb Markets, which was founded in 1996, booked $684 million in sales over the last 12 months. The New York, NY-based company plans to list on the Nasdaq under the symbol TW. J.P. Morgan, Citi, Goldman Sachs and Morgan Stanley are the joint bookrunners on the deal.

Last week, there were 3 IPO pricings. Genfit was the week's winner with a 16% gain; Lyft (NASDAQ:LYFT) traded up more than 10%.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 3/28/19, the Renaissance IPO Index was up 30.4% year-to-date, while the S&P 500 had a gain of 12.9%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Elanco (NYSE:ELAN) and VICI Properties (OTC:VICI). The Renaissance International IPO Index was up 7.5% year-to-date, while the ACWX was up 9.7%. Renaissance Capital's International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include SoftBank and Xiaomi.

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