U.S. IPO Weekly Recap And Week Ahead

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An insurance platform and a medical device company went public this past week, both of which upsized their deals and priced above the range. Two SPACs also went public. The IPO market is continuing to open up, and an uptick in filings is setting the stage for a potentially busy June.

SelectQuote (NYSE:SLQT), which distributes Medicare Advantage and other insurance products, raised $570 million at a $3.3 billion market cap in the largest IPO since early March. The company, which sees the majority of its earnings from Medicare Advantage and Supplement plans, had revenue growth of 44% in the FY19 and 48% in the fiscal YTD. SelectQuote finished up 33%.

Inari Medical (NARI), a maker of medical devices for venous diseases and blood clot removal, priced above its upwardly revised range to raise $156 million at a $1 billion market cap. The company is fast-growing and profitable, and operates in a hot space with a multi-billion-dollar market opportunity. Inari finished up 124% on its first day trading.

Glenview Capital’s healthcare-focused SPAC Longview Acquisition (LGVWU) raised $360 million, and B. Riley Principal Merger II (BMRG.U) raised $175 million to acquire a company with an enterprise value between $400 million and $1 billion.

Vroom (VRM), an online marketplace for used cars, filed for an estimated $300 million IPO. Burning Rock Biotech (BNR), a Chinese biotech using DNA-sequencing to select cancer therapies, and inflammatory disease biotech Applied Molecular Transport (AMTI) both filed to raise $100 million. Preclinical biotechs Avidity Biosciences (RNA) and Vaxcyte (PCVX) and Royalty Pharma (RPHA.RC), a company which buys royalty interests from biopharmas, all filed to raise $100 million as well. Preclinical gene therapy biotech Generation Bio (GBIO) filed to raise $125 million.

Two SPACs, Hudson Executive Capital’s Hudson Investment (HECCU) and Perceptive Advisors’ ARYA Sciences Acquisition II (ARYBU) filed to raise $300 million and $125 million, respectively. Hudson Executive Investment is targeting fintech or healthcare business, and ARYA Sciences Acquisition II is focused on the healthcare industry.

There are no IPOs scheduled for the 4-day holiday week ahead, but we expect filings to pick up ahead of a semi-active summer.

The IPO index touched another all-time high this past week, and the pipeline has a number of potential launches as the IPO market’s spring freeze continues to thaw. Chinese delivery platform Dada Nexus (DADA) is on file for an estimated $500 million US IPO and could launch in the week ahead, along with fibrosis biotech Pliant Therapeutics (PLRX), and immuno-oncology biotech Kiromic BioPharma (KRBP). The IPO market is still waiting for grocery giant Albertsons (ACI) and sales platform ZoomInfo (ZI). Micro-cap coffee packager NuZee (OTCQB:NUZE) recently set terms for its IPO uplisting to the Nasdaq, and may price its $5 million offering in the coming weeks.

Street research is expected for Lyra Therapeutics (NASDAQ:LYRA) on Tuesday, 5/26.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 5/21/20, the Renaissance IPO Index was up 15.0% year-to-date, while the S&P 500 was down 8.0%. Renaissance Capital’s IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Uber (NYSE:UBER) and Spotify (NYSE:SPOT). The Renaissance International IPO Index was up 5.1% year-to-date, while the ACWX was down 17.1%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include Adyen and Meituan-Dianping.

Original Posts: Weekly Recap, Week Ahead

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