October IPO Recap

We’ve officially entered November, and the scary season has ended (give or take a few days, depending on your feelings about next week’s U.S. election). But even without the glow of the season’s now-rotting jack-o’-lanterns, there is still a bit of a bright side to consider lately, at least within October’s IPO Market.

After four straight weeks of zero IPOs coming to market at the tail end of the summer, the end of September brought something of a flood, as fifteen IPOs – nearly half of the entire quarter’s debuts! – landed during the last three weeks of the month. And October picked up where September left off.

The month saw a total of 18 IPOs, up from 15 IPOs in September, and its $4.7B in aggregate proceeds also represented the most proceeds generated in any month year-to-date. Yes, that pales compared to last October, which $5.3B generated on 13 IPOs in October of 2015, and 2016 continues to lag far behind 2015’s IPO numbers – the full year’s deal count still remains 40.4% lower than the prior year, and has raised 43.5% fewer proceeds – but taken on its own, October performed well.

Six IPOs priced last week for combined proceeds of $2.3B, which marked the largest proceeds in a single week YTD. The slate included the largest IPO of the year (and the largest since October 2015’s First Data Corp debut), ZTO Express (Cayman) Inc.’s $1.4B debut. It was the third-largest Industrials IPO since at least 2001 and the largest from the sector since Spirit AeroSystems Holdings hit the market in November of 2006 with a $1.6B debut. (It was also the 4th largest China-domiciled IPO since at least 2001 and the largest since Alibaba’s mammoth $25.0B IPO in September 2014.)

By sector, despite ZTO Express’s big splash, the Industrials sector slotted in with the third-most IPOs of the month, as the five IPOs from the Healthcare sector led the way and the Technology sector’s four IPOs – one of which, Blackline Inc. ($146.2M), saw a 39.5% jump on its first-day – landed it in second place.

As for the rest of the year, the current 6-month IPO backlog stands at 16 issuers looking to raise $1.7B, which represents, as usual, a steep drop-off from the prior-year period, which anticipated 73 issuers for $14.8B in proceeds.

Again, if we compare October 2016 – or any of 2016 – to the year prior, or 2014’s record year, things don’t look great. But in the context of 2016, it was a good month. Hopefully November will continue the trend.

For more information on October’s IPO activity, plus a recap of follow-on activity and industry highlights, read Ipreo’s full US Monthly US IPO Brief – October.