The Resurgence of Public Offerings
As we enter the second half of 2023, the IPO market is beginning to show signs of recovery with renewed activity. After a notable slowdown last year, there have been several promising public offerings in the first half of this year. Notably, Johnson & Johnson's spinoff, Kenvue, which achieved a remarkable valuation of $50 billion following its successful IPO on the NYSE. In late June, Mediterranean-style fast-casual restaurant chain Cava Group Inc. raised $317 million in its IPO, which priced above its proposed range at $22 a share and immediately rallied on opening after underwriters JP Morgan, Stifel, William Blair, and Jefferies assigned it a buy rating or the equivalent. Today, it is trading at nearly $50.
Following closely, another IPO hit the market yesterday: Oddity Tech, an Israeli consumer tech platform for the beauty and wellness market founded by an Israeli sister-brother team that popped well-above its opening price. The stock opened at $35 and closed at $47.53 per share, and is hovering in the $50 range on its second day of trading.
The success of Kenvue, Oddity and Cava demonstrate the renewed appetite for compelling offerings with impressive growth and profits already on the books, but market
conditions remain uncertain. Still, they provide valuable insights into current investor sentiment and preferences. Understanding these trends can help pre-IPO companies craft effective investor relations strategies and communicate more effectively with potential investors. It's crucial to address any potential risks and challenges transparently in the prospectus, as investors will need a 360-degree view of the business to understand your vision. Companies should be well-prepared months in advance in terms of strategic communication strategy.
As Oran Hotzman, co-founder and CEO of Oddity told CNBC: “We are taking the company public because I want to build something huge, otherwise I would sell the company. So, this is just another milestone. Meeting so many investors in the past two weeks and ... seeing them getting what we do and connecting to our vision after so much hard work, I think that’s what makes me so happy and so grateful.”
We’re keeping a watchful eye on the evolving IPO landscape in the second half of 2023 and looking to leverage this information to navigate the path of our pre-IPO clients. If you’re mulling over your IPO investor relations’ strategy and need guidance, reach out to Graham Farrell (Graham.Farrell@Harbor-Access.com) in Toronto or Jonathan Paterson (Jonathan.Paterson@Harbor-Access.com) in the US.