• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Doug Kass
    • Bruce Kamich
    • Jim Cramer
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • Trifecta Stocks
  1. Home
  2. / Investing
  3. / Healthcare

Healthcare and Biotech Are Driving 2018's IPO Surge

Look for a flood of offerings from Chinese names in the second half of the year.
By REAL MONEY
Jul 03, 2018 | 02:28 PM EDT
Stocks quotes in this article: DOCU, EAF

The first half of 2018 brought a rebound in the IPO market not seen for the past 20 years, driven to large extent by an appetite for healthcare and technology stocks.

So far this year 120 companies have issued IPOs on U.S. exchanges raising a total of $35.2 billion, according to the Wall Street Journal citing Dealogic, which keeps data since 1995. In the past 12 months, more than 60% of the IPOs have been focused in healthcare and tech stocks, according to data from Renaissance Capital.

Confidence in a strong stock market is driving some of the increased activity, Michael Corbett, chief investment officer of Perritt Capital Management said. The firm focuses on micro and small-cap company investments between $500 million and $3 billion.

Corbett said analysts and observers could interpret that the IPO market's lopsided distribution in healthcare and tech stocks and a lack of smaller-cap IPOs just reflects where the market is now.

"We don't see companies going public in every industry. The excitement and strength in the market has been healthcare and biotech," Corbett said. "It will continue to be easier for companies like that to go public: it's not a vibrant environment across the board."

The second quarter saw 60 IPOs that raised a total of $13.1 billion, the highest flow of deals in three years with an average return of 28.6%, according to the second quarter review of Renaissance Capital.

Recent tech IPOs included DocuSign (DOCU) , which raised $629 million and GrafTech International (EAF) , which raised $525 million.

"U.S. companies really dominated in the second quarter," said Matt Kennedy, an IPO market strategist at Renaissance Capital LLC.

While the U.S. companies dominated the second quarter, more Chinese names are expected to go public in the second half of 2018.

The beginning of the second half of the year is expected to see a surge of Chinese companies filing for IPOs including Cango, an online Chinese car sales marketplace which plans to raise $300 million, and a planned $200 million tender for Rubius Therapeutics, a biotech company developing drugs for cancer and other diseases using genetically modified red blood cells, according to Matt Kennedy.

"Other rumored IPOs include Survey Monkey," Kennedy said.

Volatility caused by continued fears over protectionist trade policies and other international tensions could cool the IPO market, however he noted.

So far, though, Kennedy says, "it seems like there is no sign of slowing down."

-- By Martin Cassidy

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.
TAGS: Investing | U.S. Equity | Healthcare | China | Markets | IPOs

More from Healthcare

Broad Rally, Vaccine Optimism, Johnson & Johnson, GameStop Roars, Trading Nvidia

Stephen Guilfoyle
Feb 25, 2021 7:04 AM EST

The market's catalyst had everything to do with the virus... optimism that humankind might stuff that scourge back into Pandora's box.

Eli Lilly Is Poised for a Pullback Before Renewed Longer-Term Gains

Bruce Kamich
Feb 23, 2021 7:43 AM EST

Let's review the charts and indicators.

It's an Opportune Time to Renew Your Vows With CVS Health

Paul Price
Feb 18, 2021 7:00 AM EST

The pharmacy giant offered a great buy/write options play last summer and is setting up again for such action.

Just Had My First Teladoc Appointment: Is the Rally Over?

Bruce Kamich
Feb 17, 2021 2:39 PM EST

I may be late to trends, but not to stock charts.

CVS Health Reports Q4, and Here's What I'm Changing Up

Stephen Guilfoyle
Feb 16, 2021 10:55 AM EST

I do want to give new CEO Karen Lynch a chance. Nothing against Larry Merlo but I always thought that this stock was undervalued.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 11:32 AM EST JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    Navigating a Market Correction
  • 11:29 AM EST GARY BERMAN

    Where Does the Nasdaq Go From Here?

    Where does the Nasdaq Composite (CCMP) index go fr...
  • 12:31 PM EST GARY BERMAN

    Has the Short-Term Top Come for the XLF/Banks?

    The has triggered a long-term overbought signal ...
  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2021 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login