The U.S. IPO market looks poised to heat back up this week following last week’s largely uneventful calendar of four debuts.
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The runaway winner was Revolve Group LLC (RVLV), which hit the market last Thursday, June 6 and raised $212 million by selling 11.8 million shares at the high end of the $16-$18 range. Shares of the millennial-focused retailer also popped a massive 89% on the first day, the third-best opening-day performance of 2019 so far. That overshadowed the other three IPOs: two blank check firms Haymaker Acquisition Corp. II (HYACU) and GigCapital2 Inc. (GIX.U) as well as the Chinese online tutoring firm GSX Techedu Inc. (GSX). HYACU managed a negligible 1% first-day return, while GIX.U and GSX saw a flat first-day performance.
Here’s a rundown of this week’s calendar, which, among others, includes a giant pet food retailer and a marketplace for freelancers…
No. 5: G Medical Innovations Holdings Ltd. (GMVD)
G Medical is a commercial healthcare firm developing mobile applications that can track and monitor vital health signs, particularly related to cardiovascular disease and diabetes. The young company was only founded five years ago, which is reflected in the modest $3 million in sales booked last year. While G Medical is based in the United Kingdom, shares actually already trade on the Australian Stock Exchange (ASX) under the ticker “GMV” and are down 18.5% year-to-date.
The company is expected to sell 1.4 million American shares at exactly $10.50 apiece for a total deal size of $15 million. That would give it a market cap of roughly $81 million. The top underwriter is HC Wainwright and shares will list on the Nasdaq under the ticker “GMVD.”
No. 4: Mohawk Group Holdings Inc. (MWK)
Mohawk is a consumer products company that employs artificial intelligence (AI) and machine learning technologies to its data gathering in order to sell its products. Founded in 2014 and backed by Google Ventures, Mohawk specifically sells goods through popular online retailers like Amazon.com Inc. (AMZN), with product categories including kitchen appliances, consumer electronics, and beauty products, among others. While the firm lost $31.8 million last year, revenue more than doubled to $73.3 million. That’s solid growth for such a young company.
The IPO is set to raise $50 million by selling 3.33 million shares between $14 and $16 each. At that size, it will target a market cap of $271 million. The top bookrunners include Roth Capital Partners and Alliance Global Partners (AGP). Shares will list under “MWK” on the Nasdaq.
No. 3: Fiverr International Ltd. (FVRR)
Based in Israel, Fiverr is an online marketplace for freelance services and job outsourcing. It boasts a presence in many high-growth markets, including the U.S., U.K., Australia, and New Zealand, where it collectively earns 70% of total revenue. Although it’s currently unprofitable, the losses appear to be slimming down – Fiverr lost only $8.3 million in Q1 2019, a sharp improvement from $16.3 million a year ago. However, the IPO comes at a tricky time for freelance companies, as biggest competitor Upwork Inc. (UPWK) is currently back down to its IPO price near $15 a share.
Fiverr is expected to generate $100 million by offering 5.26 million shares between $18 and $20 each for a $635 million market cap. Heavy hitters like JPMorgan Chase & Co. (JPM) and Citigroup Inc. (C) will lead the underwriting. The stock will trade on the New York Stock Exchange (NYSE) under the ticker “FVRR.”
No. 2: CrowdStrike Holdings Inc. (CRWD)
CrowdStrike is a cybersecurity company that also happens to be yet another tech unicorn joining the markets this year following such high-profile debuts from Uber Technologies Inc. (UBER), Lyft Inc. (LYFT), and Pinterest Inc. (PINS). However, the firm – which provides cloud-based security software – bucks the recent trend of very few cybersecurity IPOs, with the only 2019 deal being Tufin Software Technologies Ltd. (TUFN). Investors will want to see CrowdStrike reduce its losses from the near-steady levels it’s seen over the last year.
The firm will raise $522 million by selling 18 million shares at a price range of $28-$30. That would provide a massive market cap of $6.5 billion. Underwriters include JPMorgan and Goldman Sachs Group Inc. (GS), and shares will list under “CRWD” on the Nasdaq.
No. 1: Chewy (CHWY)
This week’s biggest and most anticipated debut is Chewy, the online pet food retailer being spun off by national pet product retailer PetSmart. Chewy.com itself offers a selection of more than 1,600 brands and has delivered more than 100 million orders since its inception in 2011. The financials are trending in the right direction – losses lessened from $338.1 million in 2017 to $267.9 million last year, and revenue grew 68% year-over-year to $3.53 billion in 2018.
Chewy is set to generate $749 million by selling 41.6 million shares at a price range of $17-$19. A deal of that size would give the company a market cap of $7.6 billion. Morgan Stanley (MS) and JPMorgan are the primary underwriters. Shares will list on the NYSE under the ticker “CHWY.”
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