IPOs This Week: Select Energy Services in the Spotlight
Six IPOs successfully entered the public markets last week, raising about $1.2 billion. A single IPO is scheduled for this week for a company that provides water services to US oil & gas producers.
The second week of April saw six initial public offerings (IPOs) raise about $1.2 billion. The first two weeks of the second quarter have accounted for more than $2.2 billion in capital raises, the best two-week period so far this year.
Last week’s largest IPO was Brazilian airline Azul SA (NYSE: AZUL) which raised $573 million at a market cap of $2.28 billion. The airline got a first-day pop of 7% and closed the week up 9%.
Yext Inc. (NYSE: YEXT) raised $116 million at a market cap of $1.11 billion. The stock got a first day pop of 22% in Thursday’s IPO.
Warrior Met Coal LLC (NYSE: HCC) raised $317 million at a market cap of $1.1 billion. Shares dipped 5% in the Thursday IPO.
Netshoes (Cayman) Ltd. (NYSE: NETS) raised $149 million at a market cap of $559. Shares dropped 11% on the first day of trading and closed the week down 19%.
Cadence Bancorporation (NYSE: CADE) raised $150 million at a market cap of $1.66 billion. Shares rose 8% after Thursday’s IPO.
Tocagen Inc. (NASDAQ: TOCA) raised $85 million at a market cap of $184 million. Shares jumped 25% on Thursday’s IPO.
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Through the week ending April 7, IPO ETF manager Renaissance Capital reported that 35 IPOs have priced in the U.S. so far this year, up 250% year over year. Total proceeds raised through last week equaled $12.3 billion. For 2016, Renaissance Capital reported a total of 105 IPOs, down 38% year over year from 170 in 2015. Total 2016 proceeds amounted to $18.8 billion compared with a 2015 total of $30 billion. Renaissance Capital does not include “best efforts” or blank-check companies in its totals, nor does it include IPOs that raise less than $10 million.
There is just one IPO on the calendar for the week of April 17.
Select Energy Services Inc. provides water solutions to the U.S. unconventional (shale) oil & gas industry. The company plans to offer 10.6 million shares in an expected price range of $15 to $18 to raise about $175 million at an implied market cap of $900 million. Underwriters for the offering include Credit Suisse, FBR Capital Markets, Wells Fargo Securities, BofA/Merrill Lynch, Citi, J.P. Morgan, Deutsche Bank, Simmons & Co., and RBC Capital Markets. Shares are expected to price Thursday and begin trading Friday on the New York Stock Exchange under the ticker symbol WTTR.
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.
