Israel and the Solar-Powered IPO

It’s been a while since we’ve seen a whole lot of warm weather around Ipreo HQ. When it actually snowed on the first day of Spring, it almost felt like a practical joke. But some sun is on its way, and not only in the form of this week’s largest IPO.

The Israeli-domiciled SolarEdge Technologies debuts on the NASDAQ on Wednesday, and is expected to raise $136.9M marking only the second Energy IPO of 2015 (the previously discussed Columbia Pipeline Partners, which came in at $1.2B, was the first, and there remain 10 energy IPOs in the backlog, not including SolarEdge).

Drilling down further, into the Renewable Energy Equipment & Services industry that lies within the Energy sector, SolarEdge’s anticipated premiere will stand as the first market entrance from the space since TerraForm Power’s July 2014 debut, which raised $576.9M in the largest premiere from the industry on record. Since 2005, a sparse 22 IPOs from the space have raised $5.6B, with the average flotation earning a respectable $252.9M. On average, IPOs from the industry have returned a respectable 10.0% in their opening sessions. However, the average offer/current for the group stands at a marginally lower 7.7%.

Now, onto Israel itself. SolarEdge’s market entrance is not only the second Israeli company to debut on U.S. exchanges this year (first was Medical Instruments and Supplies issuer SteadyMed Ltd., which raised $40.0M last week), its premiere will also mark the very first Israeli-domiciled U.S. IPO to hail from the Energy sector that Ipreo has on record.

Dating back to 2001, Israel’s 28 IPOs have represented only three sectors: Healthcare (14), Technology (11) and Consumer Goods (3). Despite their limited range, Israeli IPOs to price on U.S. exchanges since the beginning of last year have fared well, returning an average of 14.4% in their opening sessions, as compared to 13.8% across all IPOs (i.e. all domicile countries).

Plus, of the two Israeli IPOs currently in the backlog, one hails from the popular Healthcare sector, but the other is from Industrials and is due in early April. So the countries new issuances continue to branch out. Hopefully they’ll start bringing some sun with them!