07.20.20-07.24.20 IPO Summary – Biotech Weakness Blemishes Strong Week

The week will be remembered for another strong software debut but also for the aggressive biotech pricing leading to underperformance. 

Let’s start with the good (or great).

Jamf Holdings Corp (JAMF) priced 18.0mm shares (upsized from 16.0mm) at $26.00 ($3.00 above the upwardly-revised $21-$23 range) and opened at $46.00 for a gain of 76.9% at first trade. The stock traded as high as $51.00 in the first five minutes before settling in around the $40 mark in its opening week. The three ‘5’ rated IPOs over the last two weeks, nCino Inc., Berkeley Lights & Jamf Holdings, averaged a 112.7% performance versus issue price at first trade.  

Montrose Environmental Group (MEG) priced a full-size deal, 10.0mm shares, at the low-end of the range, $15.00, and opened at $16.50 for a gain of 10% at first trade. The IPO traded exceptionally well and closed its opening session at $22.00 or 46.7% above issue.

There were four biotech IPOs that all launched Monday and debuted on Friday. All four of the deals were upsized and all priced at either the high-end or above their original ranges. The way that the deals opened, traded and closed their opening session was, for the most part, disappointing.

iTeos Therapeutics, Inc. (ITOS) priced 10.6mm shares (upsized from 8.9mm) at $19.00 ($1.00 above the range) and opened at $25.55 for a gain of 34.5%. In an unprecedented move for a JP Morgan lead left company, the deal was halted within minutes of opening. The stock reopened and immediately traded lower and in fact broke the issue price before rebounding and closing the session at $19.05.

Inozyme Pharma, Inc. (INZY) priced 7.0mm shares (upsized from 6.5mm) at $16.00 and opened at $20.80 for a gain of 30%. INZY was also met with selling pressure and traded as low as $16.10 before closing their opening session at $17.54 or 9.6% above the offering price.

Annexon, Inc. (ANNX) priced 14.8mm shares (upsized from 12.5mm) at $17.00 ($1.00 above the range) and opened at $17.40 for a gain of 2.4%. ANNX traded as high as $19.00 before closing at $17.76 — slightly ahead of its $17.60 VWAP on day one. 

Nurix Therapeutics, Inc. (NRIX) priced 11.0mm shares at $19.00 ($1.00 above the range) and opened at $18.06 for a gain of -4.9%. This was the most disappointing of the bunch. This IPO was the case of the extremely rare instance in which a deal prices above range and fails to trade higher at opening tick. NRIX ultimately traded as high as $21.33 and closed its first session at $19.01…but the results of this offering is a potential warning sign to the IPO market.

Looking ahead to this week, there are five IPOs currently on the calendar. Which one is channel checking the best? Which one is generating the most chatter amongst insititutional investors?

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