The February IPO market got off to a strong start with wood products manufacturer and building materials distributor Boise Cascade and 3D printing company ExOne both pricing above the range and immediately trading up. Riding investor confidence that the US housing market is recovering, Boise enjoyed a first-day gain of 25%. Fueled by continued excitement surrounding the 3D printing market, ExOne’s stock popped 47% in opening-day trading.
Web-based provider of short-term medical insurance Health Insurance Innovations was, however, the first “broken” IPO of 2013. Its stock inched down 2% on its first day of trading after pricing at the low end of the range and dropped another 9% by the end of February.
Online and mobile money transfer company Xoom priced an upsized IPO above the range mid-month and ended its first day of trading up 59%—the top first-day performer of the year—before giving up almost half the gain by month-end.
Tepid aftermarket performance toward the end of February combined with the withdrawal and postponement of two biotech IPOs rubbed some of the sheen off of recent average IPO returns and left the calendar entirely empty at month-end.
With a total of 11 IPOs in the first two months of the year, US IPO activity in 2013 to date is at half the level for the comparable period in 2011 and 2012 but is higher than the deal flow during the IPO doldrums from 2008 to early 2010.