Over the past five years, Healthcare has been leading the way in terms of sheer amount of IPOs brought to market, the reasons for which we’ve discussed previously. Financials is doing well in 2014, and even fast-casual eateries like Shake Shack have made splashes.
But nothing piques the public’s interest like a debut from the Tech sector.
Blame it on Steve Jobs, Al Gore, or even Skynet, but people love a good gadget or hot new pieces of technology. The stock market is no different. Unfortunately, 2015 has thus far been a little lacking in the Tech department. Recently, though, we’ve seen some signs of life.
Three Technology IPOs landed this past week, which immediately accounted for 38% of the sector’s issuances (8) so far this year. While those eight debuts (for a combined $1.65 billion) are good enough for Tech to be the third most prolific sector of 2015 (behind Healthcare’s 28 and Financials’ 12), it’s a sharp decline from what has been seen in the first half of the previous four years, which have averaged 18 IPOs (raising $6.4 billion) over January to May.
Still, the names do inspire excitement. Even Alibaba, the biggest debut of all time, has a bit of an overlap into the technology sector, the “e” in “e-commerce” helping the Consumer Goods company intersect with the Technology sector.
Speaking of Alibaba, Chinese e-commerce solutions provider Baozun – whose business is heavily tied to Jack Ma’s behemoth – priced its NASDAQ IPO to the tune of $110 million. Unfortunately for Baozun, investors seemed to give the company a lukewarm reception, as the stock crept up a mere 4.4% in its opening session and it priced below its filed range (at $10 per share). By comparison, similarly-sized Chinese e-commerce issuer Leju Holdings popped 18.6% in its $100 million debut over a year ago, while mammoth Alibaba jumped 38.1%.
On the other end of the spectrum and the globe is Shopify, a Canadian Tech company that helps businesses design and run e-commerce websites and marks the first-ever Canadian e-commerce company to go public on U.S. exchanges. Unlike Baozun, investors were eager to welcome Shopify to public markets, as the stock priced at $17 per share, the top end of its filed range. What’s more, it then rose 51.1% in its opening session, good for the seventh-highest first day pop all year, and the second-largest by a 2015 Tech IPO.
As of now, there currently sit five Tech IPOs in the six-month backlog. None of them have a household name like Facebook or Twitter, but the public will surely be watching anyway.