DoorDash and Airbnb are headlining a big week for initial public offerings.
Ten traditional IPOs are expected to price their deals this week, raising roughly $8 billion, according to data from Dealogic. This includes Airbnb and DoorDash, which each boosted their offerings ahead of their listings.
The show of strength comes during a highflying time for the IPO market. So far in 2020, 397 IPOs have traded, raising nearly $145 billion as of Dec. 7, according to Dealogic. This is nearly double the 200 new issues that collected $58.8 billion for the same period in 2019, the research firm said. The biggest IPO in 2020 remains Pershing Square Tontine Holdings (ticker: PSTH), a $4 billion special purpose acquisition company headed by Bill Ackman.
This week stands out because of the high-profile offerings from Airbnb and DoorDash. DoorDash, the food-delivery company, is pricing its $3.05 billion IPO later Tuesday and trading Wednesday. Airbnb, the home-sharing platform, is pricing its nearly $3 billion offering Wednesday and is scheduled to trade Thursday.
“Consumer outlying brands are hitting the market finally. We’ve been talking about [Airbnb] for a long time,” said Tom Taulli, an independent IPO analyst and author of the books High-Profit IPO Strategies and Artificial Intelligence Basics: A Non-Technical Introduction.
DoorDash and Airbnb are also delivering some of the year’s biggest deals. DoorDash, if it doesn’t increase its IPO, will rank as the third-largest offering in 2020, while Airbnb will place fourth, Dealogic said.
Both companies were affected by the Covid-19 pandemic. DoorDash has seen a rush of business but faces slower growth, says Kathleen Smith, a principal at Renaissance Capital. “Whereas Airbnb, after seeing sales fall dramatically due to the pandemic, will see recovering growth. Both are market-share leaders,” Smith says.
Several other companies besides DoorDash and Airbnb are expected to make their public-equity-markets debut this week, including Hydrofarm Holdings Group, 4D Molecular Therapeutics, Certara, and PubMatic.
One of the big winners could be AbCellera Biologics, which isn’t a biotech. The company provides an AI-powered R&D platform that helps speed drug discovery. In March, AbCellera and Eli Lilly (LLY) agreed to co-develop antibody products to treat and prevent Covid-19.
Lilly began testing LY-CoV555, the lead antibody from its collaboration with AbCellera, in U.S. nursing homes in August. The Food and Drug Administration in November authorized an emergency-use agreement for the drug to treat certain patients with Covid. The U.S. government in December agreed to purchase 650,000 doses of LY-CoV555 for $812.5 million, the prospectus said.
AbCellera is the latest IPO backed by Peter Thiel, the co-founder of PayPal Holdings (PYPL) and Palantir Technologies (PLTR), the big-data analytics company that went public in September via a direct listing. Shares of Palantir have nearly tripled from their $10 IPO price and are trading at $28.42.
The Vancouver, British Columbia–based AbCellera reported $1.9 million in income for the nine months ended Sept. 30, compared with $570,000 in losses for the same period in 2019. Revenue tripled to $25.2 million for the nine months ended Sept. 30 from $8.4 million in 2019.
AbCellera is expected to price its IPO on Thursday, Dec. 10, and trade the following day. The company is offering 23 million shares at $14 to $17 each and could raise $391 million at the top of its expected range. It is slated to trade on the Nasdaq under the ticker ABCL. Underwriters include Credit Suisse, Stifel, Berenberg, SVB Leerink, and BMO Capital Markets.
The IPO market is set to close up shop after next week, after two companies, Upstart and Wish, are scheduled to go public on Wednesday, Dec. 16. Roblox, a gaming platform, filed in November for an IPO but has yet to set terms.
“Usually by mid-December, that’s it. We won’t see IPOs until mid-January after that. Next week may be the last week for the IPO market [in 2020],” Taulli said.
A Roblox spokeswoman declined to comment, citing quiet-period restrictions.
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