Eight Summer IPOs Showing at Least 50% Gains

October 1, 2012 by Jon C. Ogg

Facebook Inc. (NASDAQ: FB), Groupon Inc. (NASDAQ: GRPN), and Zynga, Inc. (NASDAQ: ZNGA) have all been duds for the market around initial public offerings. These three IPOs have destroyed billions of dollars worth of shareholder value and they have also damaged investor confidence. So the IPO market must have been a stinker in 2012… Not so fast!

We were looking through the IPO class of 2012 and something incredible stood out. From the IPOs that came out this summer, there are eight IPOs which are actually up 50% or more. The list of post-IPO gainers was so strong that it was almost hard to believe.

The list of IPO winners includes the following now-public companies: Five Below, Inc. (NASDAQ: FIVE); Chuy’s Holdings, Inc. (NASDAQ: CHUY); ServiceNow Inc. (NYSE: NOW); Eloqua, Inc. (NASDAQ: ELOQ); Globus Medical, Inc. (NYSE: GMED); Northern Tier Energy LP (NYSE: NTI); Vitamin Cottage Natural Food Markets, Inc. (NYSE: NGVC); and Bloomin’ Brands, Inc. (NASDAQ: BLMN). We took a look at each to determine the value and to see what the interest. We also gave a consensus Thomson Reuters price target, although we would warn readers that these consensus figures are often not very relevant when companies are this new.

Five Below, Inc. (NASDAQ: FIVE) is now up over 125% from its July IPO. Shares even hit another post-IPO high on Monday. This is not quite a dollar store, but it is a $5 and under store geared toward the young consumer. The $17 IPO now has a new post-IPO range of $25.00 to $40.00. Analyst price target: $35.29

Chuy’s Holdings , Inc. (NASDAQ: CHUY) was up over 7% at $26.43 on Monday and that tipped shares above a 100% gain since its IPO. The Tex-Mex chain still has many new growth markets to target and its July IPO of $13 is now above $26.00. What is so peculiar about this IPO is that it often trades under 100,000 shares in a trading day. Analyst price target: $22.33

ServiceNow Inc. (NYSE: NOW) saw its stock lose about 10% on Monday after UBS downgraded the stock. This enterprise information technology management software-as-a-service provider is still a winner as the $34.70 price compares to its $18 IPO price from late June. The post-IPO range has been $22.62 to $41.77. Analyst price target: $31.88

Eloqua, Inc. (NASDAQ: ELOQ) is up 70% at $19.70 from its $11.50 IPO from the start of August. The volume had dwindled to a very low level here of under 100,000 shares but over the last two weeks it seems to have picked up as institutions likely bought shares up. The company has a SaaS model and provides on-demand revenue performance management software solutions for businesses. The market cap is $631 million. Analyst price target: $20.25

Globus Medical, Inc. (NYSE: GMED) was up at a new post-IPO high of $19.10 on Monday and this is up more than 55% from its $12 IPO in early August. The medical device company sells products that promote healing in patients with spine disorders and the market cap here is about $1.7 billion. The excitement seems tied to a recent approval of its SECURE®-C Cervical Artificial Disc. Analyst price target: $18.42

Northern Tier Energy LP (NYSE: NTI) has performed incredibly well. The MLP is up more than 50% after hitting a new post-IPO high of $21.50 on Monday. This one came public in late-July at $14 per unit and the 52-week range has bene $13.00 to $21.50. We are still waiting for its formal distribution to calculate a yield-equivalent here but the excitement has been obvious based on its price. Analyst price target: $22.67

Vitamin Cottage Natural Food Markets, Inc. (NYSE: NGVC) has been a stellar IPO for groceries, vitamins, and body care products. Its $15 IPO in late July is now up about 52% at $22.81 and its post-IPO range has been $17.20 to $23.30. The market cap here is still just under $500 million. Analyst price target: $24.33

Bloomin’ Brands, Inc. (NASDAQ: BLMN) hit a new high of $16.65 on Monday, which gives it a 51% jump over its $11 IPO from early August. This one owned and operated more than 1250 restaurant chains under the brands of Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill, and Fleming’s Prime Steakhouse. This is a repackaged IPO after having been taken private under the old Outback Steakhouse corporate name. Apparently the public likes its value and the private equity sellers are sitting on that much more value now. Analyst price target: $17.31

JON C. OGG

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