IPO News – US IPO Weekly Winners & Losers
The 10-year Treasury yield reached its highest level since 2007 this week, and the Fed followed by voting to raise rates for the first time in three years, with another hike expected before year end.
It’s not the backdrop we wanted behind the fall pickup: higher rates discount the distant profits growth companies promise, and the prospect of more hikes makes pricing a moving target. IPO candidates are letting the dust settle. Fewer launches than anticipated this week, and just a couple major filings, including AI cloud firm Nscale.
That said, this latest speed bump joins a long list from the past few years. Issuers have become more adaptive, and public investors are now more efficient at processing headlines. There’s still a healthy lineup of deals in the pipeline (SB Energy, Oura, Aggreko, Cumberland Farms, Accelevation). Next week should tell us whether this is a hiccup or a bigger hurdle.
Three sizable IPOs priced through the rocky news cycle. Rare disease-focused Electra Therapeutics (Nasdaq: ETRA) tested the biotech theme. It priced an upsized deal at the midpoint then traded down -12%. The less-active financial sector reappeared with insurer Orion180 (Nasdaq: OIG) and Hawaii community bank American Savings Bank (NYSE: ASBH). American Savings delivered a modest gain, while Orion180 slid on day one.
One deal didn’t get done. Holtec Nuclear postponed its $825 million IPO, with its CEO noting the recent downturn in the AI data center trade. As our senior strategist said in Reuters, it doesn’t point to a structural issue in new stocks. Instead, the broader AI investment super-cycle will be made up of these mini-cycles.
Coming up, home insurer Bamboo Insurance Services (NYSE: BMB) and defense materials producer Amaero (Nasdaq: AMRO) are scheduled for the week ahead.
The IPO Index finished the week up +0.5%, outperforming the S&P 500 which fell -0.1%. Precision medicine platform Tempus AI surged +31.9% on higher reimbursement estimates. Embattled LNG firm Venture Global landed at the bottom, down -11.3%.
The IPO Index finalized its Q3 rebalance on Friday. It will be adding nine companies effective Monday, including mega IPO SpaceX.
The Renaissance IPO Index returned 0.5% last week vs. -0.1% for the S&P 500.
