Your IPO “Cheat Sheet” For June

Fake news and political mudslinging is at a fever pitch.

Yet there’s an opportunity cost to buying into the Beltway chaos.

When truly valid storylines can’t even make the back page, we all lose.

I’ll share one such example today.

IPOs are performing admirably in the first half of 2017.

In fact, IPO year-to-date returns of 16.7% are better than twice the S&P 500.

The big IPO winner so far is AnaptysBio Inc. (Nasdaq: ANAB).

AnaptysBio is a clinical-stage biotechnology company that specializes in anti-inflammatory protocols.

So while CNN sparks “faux outrage” on everything happening inside the Oval Office, they’re ignoring companies trying to improve the lives of people.

Only 10 of 2017’s 46 IPOs are presently underwater.

With nine more IPOs on the table — led by names like Yeti, Biohaven Pharmaceuticals and G1 Therapeutics — let’s dive deeper into IPOs.

I asked my senior analyst Martin Hutchinson to give our readers an edge heading into summertime.

Hutch’s full IPO report is below.

Ahead of the tape,

Louis Basenese

Question: Martin, you’ve agreed to help us compile a library of the most important investment catalysts. These are all baseline concepts that we believe every investor should know.

Today, we’ll be discussing IPOs, so let’s jump right in. Let’s start at the beginning. What is an IPO?

Martin Hutchinson: Initial public offerings (IPOs) are the traditional means by which companies sell shares to the general public for the first time, and thereby fund themselves short term and provide a platform for further funding for long-term growth.

IPO volume dropped 36% in 2016: 112 IPOs raised $21.6 billion. And that was the smallest volume since 2009. But there’s been a recovery in 2017, with a big $4 billion IPO for Snap Inc. (or the Snapchat company) in March. Although that company recently reported first-quarter earnings that weren’t that happy.

Question: Martin, are IPOs any type of indicator that can tell us a little bit about the underlying economy or the underlying stock market?

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Author: Travis Esquivel

Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

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