July IPO Recap

As we wrote in last month’s look at the second quarter’s IPO market, June really kicked 2018 into high gear.

27 IPOs were recorded, with 11 of them debuting in the last week, marking the highest IPO count for a single week since June of 2015. Unfortunately, the first week of July features Independence Day, which tends to create a hiccup, and the dreaded summer slowdown is not far off. So the question going into the month was whether June’s momentum would prevail over vacation season.

Let’s call it a draw.

Despite a heat wave that impacted much of the United States, July couldn’t quite match June’s scorching pace. Having said that, the 20 IPOs the month generated was not too shabby, especially when you consider the $4.5B in proceeds was only slightly off June’s $5.0B pace.

July 2018 also represented the largest year-over-year increases in both deal count and monthly proceeds, crushing last July’s totals in both areas by 12 and 370.9% respectively. One thing that didn’t change was Healthcare’s stranglehold on the deal count. After June’s 14 IPOs from the sector, July brought in 9 for $1.1B in proceeds. Consumer Services collected the most proceeds, even with just one debut: Pinduoduo Inc., which raised $1.6B. Of note, Pinduoduo marked the fifth Chinese Consumer Services IPO of the year, while accounting for over one-third of July’s aggregate proceeds.

The summer has started off strong, but now that we’ve entered the traditionally vacation-heavy month of August, the dog days aren’t far off and, with it the summer swoon. The past few years have seen the market taking a siesta as the summer winds down, and we’ll be keeping an eye out to see if the trend changes.

As for the longer-term, the current six-month backlog stands at 22 IPOs, dipping from the 31 IPOs reported in the prior-month, and decreasing from the 26 IPOs reported in the analogous period the prior-year. The International IPO backlog is currently at 6, down from the 10 IPOs seen in June, but increasing from the 4 IPOs seen in the July 2017 backlog. Of note, the Energy sector has seen a massive drop in backlog IPO count year-over-year for July, as there are only 2 Energy IPOs in the backlog, compared to the 9 seen in the same month of 2017. The largest IPO currently in the backlog is Cushman & Wakefield plc, which hails from the Real Estate sector, and is seeking to generate $765.0M in proceeds.

Get all the details on the first quarter’s new issuance activity in the full July IPO Brief