Brand-Name IPOs Overshadow Unknowns
Despite BATS very public IPO failure, 36 companies have launched successfully in the first quarter. Investors, though, have learned to jump in quickly. Many of these successful IPOs closed much higher than their offering prices, only to exhaust those early gains.
Yelp! (YELP) was one of the companies which benefited from consumer recognition. It was priced at $15 earlier this month and closed on its first trading day at $24.58. It's now trading at roughly $28. Zynga(ZNGA) , another fan favorite, priced its stock at $10 late last year, but dropped 5% the first day. It then climbed to a high of $12.56, only to pull back to $12.30. These trading patterns are teaching traders to get in early for these consumer-friendly names.
The IPO love, however, hasn't carried over to the energy offerings. Solar company Enphase(ENPH) priced at $6, way below its planned range of $10 to $12 although it increased the amount of shares it offered, while natural gas shipper GasLog(GLOG) priced at $14, also below its planned range of $16 to $18.
Annie's Pasta (BNNY) started out as a small deal looking to raise $70 million and offered 5 million shares at a range of $14 to $16. But as the buzz got louder, Annie's increased the size of the deal to $85 million and lifted the price range to $16 to $18.
The shares ended up being priced at $19 and the stock jumped to $30 on its first day of trading. That's the best first-day stock event since LinkedIn turned in a return of 109% on its first day.