Weekly Secondary Performance (3.23.18)

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The average gain of IPO Boutique Neutral rated offerings this week at first trade was 2.3%.

The last 20 IPO Boutique ‘BUY’ rated secondary offerings have produced an average gain of 1.8% at first trade and an average gain of 4.5% at the high of their first-day of trading.

It was a light week for the secondary market with market volatility weighing heavily in the latter half of the week. The strongest performing deals at first trade this week among companies that raised more than $20m were Cision Ltd (CISN), Forescout Technologies (FSCT) and Glycomimetics (GLYC) with opening trades of 5.6%, 5.2% and 5.4% above their offering prices, respectively. IPO Boutique placed BUY ratings on each of those three.

The largest offering this week was a $350m (upsized from $300m) offering of Arena Pharmaceuticals (ARNA). This was one of two biotech offerings that were upsized this week (the other Xencor (XNCR)) and each had muted openings. ARNA opened 0.1% and XNCR opened -0.5% versus the offering price.

It should be noted that the Neutral % at first trade was heavily skewed due to there being just four ‘Neutral rated’ offerings and one of which, a $14m deal underwritten by Raymond James….Leap Therapeutics (LPTX), opened 9% above its offering price. We rated the LPTX deal “Neutral” (and in hindsight would again) because the Dow was down more than 700-points when the overnight deal launched.

There is currently one secondary offering on the schedule for next week, OP Bancorp (OPBK), and we currently have a BUY rating on the deal.