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The last quarter stockmarket slump hurt the less liquid stocks more than most. IPOs can be a risky game, and while some are great success stories some not so much. Here are the worst of of 2018; $GNPX $EVER $STG $ECOR $MNLO. 


Worse IPO 2018

There were 19% more IPOs in 2018 than 2017, up 32% in capital raised year over year with the median deal size this year around $108 million.

  • The most number of IPOs were in healthcare with 76 in 2018 which showed an average return of 8.9% on total proceeds of $9.1 billion.
  • The tech sector had the second-highest number with 52 IPOs which posted an average return of 8.1% on total proceeds of $18.4 billion.

.Notice also many of these top IPOs reversed substantially off 2018 highs above their IPO price.

The Worse Performing IPOs For 2018 

1. Genprex ($GNPX): Down 78.0% at $1.10 Close

Micro-cap gene therapy biotech Genprex priced $6 million IPO at $5 on March 29, 2018. Genprex is developing gene-based nanoparticle therapies to treat cancer, raised $6.4 million by offering 1.28 million shares at $5 per share giving it a fully diluted IPO market cap of $75 million. It was not alone as a biotech of the 10 worst performers, seven are health care stocks, with two tech stocks (EverQuote and Sunlands Online Education) and one is industrial (U.S. Xpress Industries).

Genprex has headquarters in Austin, Texas and Cambridge, Mass.. The company has two ongoing clinical trials. One is a Phase I trial at The University of Texas MD Anderson Cancer Center evaluating intravenous Oncoprex monotherapy in stage IV recurrent, metastatic lung cancer. The other is a Phase II trial of Oncoprex in combination with Tarceva (erlotinib) in stage IIIB/IV lung cancer patients. Since the company’s IPO on March 29, shares have fallen 78 percent after actually being up near 300%.

GNPX IPO 2018

2. EverQuote ($EVER): Down 76.8% at $4.18 Close

EverQuote Inc. announced the pricing of its initial public offering of 4,687,500 shares of its Class A common stock at a public offering price of $18 per share. EverQuote utilizes proprietary technology and data to match insurance shoppers with carriers and agents, both online and offline. The software recommends carriers based on the consumer’s risk profile and information on which carriers consumers with similar profiles have chosen in the past. EverQuote calls itself the “largest online insurance marketplace” with 10 million consumer visits per month. More than 90 percent of its sales are of auto insurance; in 2016 it also began selling life and home insurance and launched a safe driving app, EverDrive.

 EVER IPO 2018

3. Menlo Therapeutics ($MNLO): Down -75.76% at $4.12 Close

Menlo Therapeutics Inc. MNLO priced its initial public offering late at $17 a share, the high end of its $16 to $17 range selling 7 million shares to raise $119 million. The company  upsized the deal and lifted the price range from a previous plan to offer 5.7 million shares at $14 to $16 a pop. 

Menlo is a late-stage biotech focused on treatments for pruritus, or itch, in skin conditions including atopic dermatitis, psoriasis and others. MNLO is located in Menlo Park, CA.  On December 10, the company announced positive top-line results from MTI-109, its Phase II clinical trial of serlopitant for pruritus associated with psoriasis. The trial met its primary endpoint. The company’s shares have dropped 70.18 percent since its January 25th IPO.

MNLO IPO 2018

4. Sunlands Online Education ($STG): Down 73.40% at $3.04 Close

Timing can be everything with IPOs. Sunlands raised $149 million in its IPO just before before President Trump announced plans to impose tariffs on up to $60 billion of goods from China in the ongoing trade war. Sunlands specializes in online post-secondary and professional learning, is among a growing number of businesses benefitting from growth in spending on private-sector education in the country.  

Sunlands Online Education Group's opened after it's IPO at $13.10 on the NYSE, or 14% above the $11.50 initial-public-offering price. The company's IPO priced late Thursday at the low end of the expected range of $11.50 to $13.50 a share, to raise $149.5 million.

China’s combined spending on professional and degree- or diploma-related education will increase to 130 billion yuan in 2022 from 33.6 billion yuan in 2017, according to Internet research firm iResearch. However by year's end Sunlands Online Education Group finished down 76% as Chinese education company stocks were hit hard after draft legislation in China caused uncertainties about future merger and acquisitions, a big driver of growth.  Another Chinese education stock, Puxin Ltd. $NEW,was down nearly 70%. 

 STG IPO 2018

5. electroCore ($ECOR): Down 58.26% at $6.26 Close

electroCore, Inc priced its initial public offering of 5,200,000 shares of common stock at a public offering price of $15.00 per share. ElectroCore was backed by the venture capital arm of Merck & Co, the share offering is raising $78 million. The company intends to use the proceeds to commercialize its medical device gammaCore in the United States and to research treatments for neurological and rheumatological conditions.

Last year, U.S. health regulators approved gammaCore to treat cluster headaches, a condition that affects around 350,000 people in the United States. The hand-held device, which can be self-administered, treats the severe form of headache by applying a mild electrical signal to the vagus nerve through the skin.

ECOR IPO 2018

 

The close prices was taken as the trading day before Christmas December 31, 2018 note they differ from the December 13 ranking prices.

Sources: 

Live From The Pit

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