Investing

IPO Calendar Has 3 New Names Following Last Week's Successes

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Finally the 2016 initial public offering (IPO) market showed some signs of life last week. Three large, revenue-producing companies made it out the door last week, and two priced above their expected mid-points.

MGM Growth Properties LLC (NYSE: MGP) price 50 million shares at $21, the high-end of its expected range to raise $1.05 billion. Shares popped 4.8% on the first day of trading and ended the week up 7.7%.

American Renal Associates Holdings Inc. (NYSE: ARA) priced 7.5 million shares at $2, just above the expected mid-point of $21.50, raising $165 million. Shares jumped 20.5% on the first day of trading and closed the week up 2.3%.

SecureWorks Corp. (NASDAQ: SCWX) downsized its IPO from 9 million to 8 million shares and priced the shares at $14, well below the expected range of $15.50 to $17.50. The Dell spinoff raised $112 million and closed flat on the first day of trading.

Through the week ending April 22nd, IPO ETF manager Renaissance Capital reported that 13 IPOs have priced in the U.S. so far this year, down about 71% from a year ago. Total proceeds raised through last week equaled $2.3 billion, down 68% compared with the same period in 2015. Of the 13 IPOs that have gone off this year, 10 have come from the healthcare sector. Last year’s IPO total came in at $30 billion on 170 offerings. Renaissance Capital does not include “best efforts” or blank-check companies in its totals.

In the coming week three more IPOs are on the calendar: a resort and casino operator, a water and wastewater utility, and a Shanghai-based online brokerage for spot trading of precious metals. The three firms are looking to raise a total of around $638 million in the IPOs.

Red Rocks Resorts Inc. is a gaming, development, and management company currently operating 21 casino and entertainment properties. The company plans to offer 27.3 million shares in an IPO price range of $18 to $21 to raise $531.4 million at an implied market cap of $2.26 billion. Joint bookrunners for the offering are Deutsche Bank, J.P. Morgan, BofA/Merrill Lynch, Goldman Sachs, Wells Fargo Securities, Citi, and Macquarie Capital. Co-managers include Fifth Third Securities, Credit Suisse, UBS Investment Bank, Stifel, Raine Securities, Oppenheimer & Co., Guggenheim Securities, and Ramirez & Co. Shares are scheduled to price Tuesday and begin trading Wednesday on the Nasdaq under the ticker symbol RRR.

Yintech Investment Holdings Ltd. is a Shanghai-based, online trading service offering spot commodity trading for precious metals. The company plans to offer 7.5 million American Depositary Shares (ADS) in an expected price range of $12.50 to $14.50. One ADS is equal to 20 ordinary shares. The company hopes to raise $101.3 million at an implied market cap of $786.2 million. Sole bookrunner for the offering is Jefferies and the only co-manager is PingAn Securities. ADSes are expected to price on Tuesday and begin trading Wednesday on the Nasdaq under the ticker symbol YIN.

Global Water Resources Inc. is a water and wastewater management company operating principally in Phoenix, Arizona, serving more than 50,000 people and about 20,000 homes. The company’s common stock already trades on the Toronto Stock Exchange. The company plans to offer 1 million shares in an expected price range of $5.25 to $6.25 to raise $5.8 million at an implied market cap of $110.6 million. Sole bookrunner for the offering is Roth Capital. The shares are scheduled only for the week of April 25th and will trade on the Nasdaq under the ticker symbol GWRS.

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