IPOs are back in full swing after the biggest week for public listings year-to-date in this coronavirus era.
Warner Music Group (WMG) last week raised $1.9 billion during its debut, making it the biggest IPO of the year, while ZoomInfo (ZI), a cloud based platform for sales and marketing teams, raised almost $1 billion. Shares of ZoomInfo closed over 60% higher on its first day of trading.
Shift4 Payments (FOUR) also received a solid welcome on the public markets last week. The company, which processes payments for over 200,000 businesses, priced its IPO above its range, at $23 a share. Shares soared 45% on Friday.
Shift4’s founder and CEO Jared Isaacman told Yahoo Finance his company’s roadshow was postponed back in March due to COVID-19. But his company saw encouraging signs in the economy, with “a recovery happening” over the last several weeks.
“We have tons of data, and we started to see the recovery really in late March and through April, and then really accelerate in May,” said Isaacman. “That’s what gave us the confidence to kind of reignite the IPO process and get it going.”
He says during the darkest periods of declines amid the pandemic, payment volumes dropped 70-75% in late March.
“But right now we’re seeing a 120% recovery from that period. That sure looks like a V-recovery to us,” he said.
“There are several states around the country that have cities that have reached pre-Covid processing levels, which is just a really encouraging sign for everybody else as we move forward,” he added.
Isaacman wasn’t shocked by the May jobs report, which showed the economy added 2.5 million jobs, instead of shedding jobs as economists had expected.
“We weren’t surprised ... because it certainly coincides with what we’ve been seeing in the numbers for the last few weeks,” he added.
The recent IPOs come amid the biggest 50-day market rally in history following the March 23rd lows. Investors appear to have a renewed appetite for listings after the IPO market fizzled out last year following the WeWork debacle.
Another batch of companies are set to go public this week, including used-car marketplace Vroom. The company aims to sell 18.75 million shares when it debuts on the Nasdaq under the ticker “VRM,” and currently expects to price shares between $15-$17.