The 3 Most Successful IPOs of 2014 (So Far)
As can be expected of a busy IPO year, some of 2014's new stock market titles have been runaway hits soaring above their issue price, while others have belly-flopped. Since we're heading into the most optimistic time of the year, we'll shine a light on the three best performers. In order of stock price appreciation, they are:
2014's current IPO front-runner is this company, maker of the popular action photography camera -- the one that's usually responsible for those hairy point-of-view videos posted on Facebook (FB) and other online sharing sites. GoPro's stock hit the market at the end of June priced at $24, and as if this writing it now stands at $70.72 for a muscular 195 percent total return.
Although that's impressive, it should be noted that the current price is quite a bit lower than the stock's high of nearly $94, which it touched in early October. But then the camera was effectively blamed for the horrific accident that befell Formula One racing star Michael Schumacher -- although the journalist making the allegation later recanted -- and the shares cratered.
The stock recovered after the company reported strong third-quarter earnings, and all seemed well again... until GoPro decided to float a secondary issue of stock. It'll sell 10.3 million fresh shares on the market, adding to the nearly 126 million currently outstanding. When secondary share issues are announced, a company's stock often takes a hit, since investors aren't too crazy about their existing stakes being diluted.
Regardless, on a fundamental basis GoPro is a popular, if niche, product, while the company's revenues are growing and its bottom line is well in the black.
Immune Design (IMDZ)
Who isn't eager to find a cure for cancer? That's the thrilling potential of this newly public biotech firm, which develops technologies that help the body's immune system produce cells that battle forms of the illness, in addition to other ailments.
The upside of success in the cancer fight, it goes without saying, is enormous. This is likely one major reason that Immune Design's shares have zoomed up 184 percent less than four months after the company's late July IPO. From an issue price of $12 per share, the company's stock now trades at over $34.
Since it went public, the few news items coming from the company have been rather positive. Mere days after the IPO, it announced that it was licensing its GLAAS discovery platform, which aims to develop treatments for food allergies, to global pharmaceutical giant Sanofi (SNY). Shortly thereafter, the latter's vaccines unit Sanofi Pasteur entered into a collaboration with Immune Design to develop therapies for the herpes simplex virus.
Immune Design's recently released third-quarter results are also helping to support its rising stock price. Thanks to Sanofi, it was able to book its first significant revenue ($3.5 million, to be exact), boding well for its future.
Radius Health (RDUS)
Close on the heels of Immune Design is this biotech company, a developer of women's health products. In particular, Radius Health has its hopes pinned on abaloparatide, a treatment for the bone disease osteoporosis. This ailment is more likely to afflict women.
The company describes the market for osteoporosis as "large and underserved," and it seems the investing public agrees. The stock floated at $8 per share in late July and recently closed at $22.22, for a total return of 178 percent.
That IPO, which saw the company raise $52 million, was actually its second attempt at going public. It originally filed to do so in early 2012 but withdrew the application later in the year, ascribing its decision to "market conditions and volatility." Considering how well the shares have done in the early part of their lives this year, that was a wise move.
As with many newly public biotechs, Radius Health is still deeply in the red, with no revenue to speak of and research and development expenses well in the millions of dollars (almost $14 million for the third quarter, in this case).
But the company's optimism has clearly struck a chord with investors: It hopes to submit abaloparatide for approval to the Food and Drug Administration and European regulators next year; a product launch should follow soon thereafter.
Motley Fool contributor Eric Volkman owns shares of Facebook, his last meaningful IPO investment. The Motley Fool recommends Facebook and GoPro and owns shares of Facebook (FB). Try any of our Foolish newsletter services free for 30 days. Will this be your most successful investment of 2015?: Check out The Motley Fool'sone great stock to buy for 2015 and beyond.