The US IPO market produced seven IPOs in January 2013—the busiest start to the year since 2006. Buoyed by the $2.2 billion IPO of Pfizer’s animal health unit Zoetis, gross proceeds in January were $3.3 billion—the highest January figure since 2000. The month included IPOs by well-established companies with proven revenue and profitability as well as a trio of biotech offerings.
The average first-day gain for January’s IPOs was 18% compared to 16% for all IPOs in 2012. Norwegian Cruise Line, Bright Horizons and Zoetis enjoyed first-day gains of 30%, 29% and 19%, respectively—these gains were all the more striking because each offering was priced above the range. There were no “broken” IPOs (IPOs whose stock closes below the offering price on their opening day) in the month.
With offerings by KaloBios Pharmaceuticals, LipoScience and Stemline Therapeutics during the last week of January, the biotech IPO market began the year with a solid start. LipoScience and Stemline rose 16% and 18%, respectively, in first-day trading while KaloBios was flat. Each of these IPOs priced at the bottom of the range.
The remaining January IPO was by Starwood-backed homebuilder TRI Pointe Homes, which saw a 12% first-day gain after pricing above the range.