IPO’s See Good Results
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Much time has passed since the hey day of the IPO, when they generated tens of millions of dollars almost no matter what the company was. These days dollars are more closely invested in IPO’s and the value of the offered product or service has to show some significant potential worth. Gone are the days when investors would blindly throw money at an IPO. Sometimes they still miss the mark, but that is the nature of investing; an investor makes the best assessment they can and the rest is up to the company and the market.
During the week of October 8, nine IPO’s rolled out and while they lacked the glamour of a Google or Facebook, they still posted good results. Most of the companies posted modest gains, one company made out very well. Workday, Inc (NASDAQ:WDAY) was the big winner after being priced at $28 a share, opened at $48.05, on 22,750,000 Class A common shares, closing at $48.69 on Friday Oct. 12. The increase was 74% over the original pricing, no other IPO roll out came close to the success of Workday during that week. On Wednesday, Workday, Inc. closed at $48.50
Workday provides enterprise cloud applications for human resources and finance to hundreds of businesses that range from mid-size companies to the Fortune 50 in such areas as Human Capital Management, Payroll and Procurement. Workday was founded in 2005 by Dave Duffield and Aneel Bushri and is located in Pleasanton, CA. It has offices in San Francisco, Atlanta, Chicago and other U.S. cities. They also have offices in other countries including: Paris, France, London, UK, and Sydney, Australia, several cities in Canada and other locations. Workday looks to be a stable company for investment and growth. The company is hiring too, with job openings in many of their offices, in addition to the Pleasanton headquarters. Duffield is the former founder of Peoplesoft.
Other companies that rolled out IPO’s during the week of October 8 were: Diamondback Energy, Inc., LinnCo, LLC (NASDAQ: LNCO), Intercept Pharmaceuticals Inc (NASDAQ: ICPT), Realogy Holdings Corp.(NYSE: RLGY), Shutterstock, Inc. (NYSE: SSTK), Kythera Biopharmaceuticals, Inc., Ambarella, Inc. (NASDAQ: AMBA), and Amira Nature Foods, Ltd (NYSE: ANFI).
Diamondback Energy, Inc. opened trading on their shares at $17.82, up from an expected $17.50. The company sold 12,500,000 shares and had posted modest gains when the IPO first rolled out. On Wednesday the stock closed at $17.03. Diamondback Energy is an independent oil and natural gas company exploring and developing resources in the Permian Basin in West Texas. LinnCo Energy rolled out 30,250,000 shares of common stock at $36.50 per share, which was down from the expected price of $41.24. LinnCo Energy, a wholly-owned subsidiary of Linn Energy closed at $38.26 on the opening day of trading. The most recent close on Oct. 31 was $39.06. Linn Energy, is an independent oil and natural gas company that is publicly traded and based out of Houston, TX. The company recently announced a dividend of $0.71 per common share. Intercept Pharmaceuticals, Inc. debuted it’s IPO at $15 per share on 5,000,000 shares of common stock. Intercept Pharmaceuticals, a biopharmaceuticals company, focuses on treatments for chronic liver conditions, and has a drug treatment for liver conditions that is designated in the U.S. and Europe. Intercept shares closed Wednesday at $18.06. Realogy Holdings Corp. rolled out it’s IPO at $32.85 per share, on 40,000,000 shares, up from it’s initial price of $27.00, closing at 34.20 for the day. The price represents an increase of 22% over the intended price. The company's most recent close was $35.54. Realogy is a global real estate firm whose business model includes real estate franchising, brokerage and other services. Among the companies included in the Realogy portfolio are: Sotheby’s, Coldwell Banker and Better Homes and Gardens Real Estate. Shutterstock priced it’s 4,500,000 shares at $17 per share, and it has been trading near $22 since it’s opening; it closed at $23.75 on Wednesday. The company is a global licensing firm for images for businesses. They license photos, videos, illustrations and vectors. Headquartered in New York City, the company was founded in 2003. Kythera Biopharmaceuticals offered it’s 4,400,000 shares of common stock at $16 per share, and has been trading above that since the IPO rolled out. Wednesday saw the stock close at $21.98. Kythera is a clinical stage company involved in the research and development of facial aesthetic products at this time and is currently working on an injectable drug to address the "double chin". The company is headquartered in Calabasas, CA and was founded in 2005. Kythera’s IPO closed on October 16. Ambarella, Inc. develops video compression and image processing solutions used in sports cameras, digital cameras, television broadcasting infrastructure, security cameras and more. It was founded in 2004, and is headquartered in Santa Clara, CA, with offices in Asia. The company offered it’s IPO at $6 per share on 6,000,000 shares, of which approximately 4.900,000 are common stock. The pricing was below the expected rollout of $9-11. On Wednesday Ambarella shares closed at $7.22. Amira Nature Foods, Ltd, introduced it’s IPO at $10 per share, on 9,000,000 ordinary shares. The $10 share price was below the expected $13-15 range. Amira's shares closed at $8.05 on Wednesday. Amira is a food specialty company headquartered in New Delhi, India, with additional offices in the U.S., U.K., and the Middle East and Asia. It was founded in 1915, and is in it’s fourth generation of family ownership. All of these companies saw their IPO’s realized between October 10-12. For the most part, all of these IPO'S have been trading well since inception.
