Five IPOs, each fetching a price at the top end of their initial estimates, cast an optimistic glow on the market for the week ending Oct. 12, according to the Wall Street Journal (http://online.wsj.com/article/SB10000872396390443294904578053012301202162.html?KEYWORDS=ipo+outlook+chris+dieterich). The five successful IPOs also ended what the WSJ termed a “dull spell” and a “languid stretch for IPOs.” That each of the five companies came from different industries was also a strong signal for the market and it was the first time in 10 years that “five IPOs shot that high in tandem,” according to the report.
Much was made of the Workday Inc. (NYSE: WDAY) debut, which jumped more than 75 percent. The Pleasanton, CA-based provider of human resources software continued to run on Oct. 15-16, and was all the way to $52.70 at mid-day Oct. 16. Parsippany, NJ-based Realogy Holdings Corp. (NYSE: RLGY) , formerly Domus Holdings, which provides real estate and relocation services, climbed to $35 by mid-day Oct. 16. But those two companies have market caps of $8.5 billion market and $4.6 billion, respectively, placing them out of our small cap focus.
The other three IPOs, including Shuttterstock, Inc.; Kythera Biopharmaceuticals and Intercept Pharmaceuticals, are small caps and therefore squarely in our sweet spot.
New York City-based Shutterstock Inc. (NYSE: SSTK, http://www.shutterstock.com/) operates an online market for digital imagery including licensed photographs, illustrations and videos. SSTK was founded in 2003. By mid-day Oct. 16, the third trading day after its debut, SSTK was still climbing to $23.01 with a market cap of $754 million.
Calabasas, CA-based Kythera Biopharmaceuticals (Nasdaq: KYTH, http://www.kytherabiopharma.com/) is a clinical stage biopharmaceutical company that develops and markets prescription products for the aesthetic medicine market, initially the facial aesthetics market. Its first drug, now in Phase III clinical development, reduces double chins. At mid-day Oct. 16, three days after its debut, KYTH was soaring, up 18.6 percent to $24.61 with a market cap of $427 million.
New York City-based Intercept Pharmaceuticals (Nasdaq: ICPT, http://www.interceptpharma.com) develops and markets therapeutics to treat chronic liver disease. Its lead product candidate was developed initially for the second line treatment of primary biliary cirrhosis. Three days after its debut, ICPT continued to trade strongly and by mid-day was up 22 cents to $19.48. Its market cap is now $307 million.