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The Slow Start for IPOs Continues

Santander Consumer leads a short list of IPOs


Last week was the official launch of the IPO market for 2014 — and unfortunately, the overall performance was pretty lackluster. Only one deal had a double digit positive return: Cypress Energy Partners (CELP), which posted a gain of 12.3%. In fact, two other deals fell from their offering prices.

handshakeAs for the upcoming week, there will likely be a continuation of the tepid activity, with only three deals on tap. Then again, the week is shortened because of the Martin Luther King holiday, which likely put a damper on activity.

But are there any winners in this week’s offerings? Let’s take a closer look at each: (CRCM)

The company operates a platform that helps people connect with caregivers. There are 9.7 million members spanning 16 countries.

Growth has certainly been robust for the company’s monthly subscription revenues. From 2010 to 2012, revenues soared from $12.9 million to $48.5 million. However, is still losing money. For the first nine months of 2013, the net loss came to $24.7 million. plans to issue 5.4 million shares at a range of $14 to $16, and the lead underwriters include Morgan Stanley (MS), BofA Merrill Lynch (BAC) and J.P. Morgan (JPM).

Rice Energy (RICE)

This is a natural gas and oil operator that is focused on the Appalachian Basin. The company believes that the area offers the highest return in North America for shale plays.

For the first nine months of last year, Rice posted $123.7 million in revenues and a net loss of $7.8 million. So far, the company has drilled and completed 37 horizontal wells, with the lateral lengths averaging 5,669 feet.

Rice Energy intends to issue 40 million shares at a range of $19 to $21, and the lead underwriters include Barclays (BCS), Citi (C), Goldman Sachs (GS), Wells Fargo Securities (WFC), BMO Capital Markets and RBC Capital Markets.

Santander Consumer (SC)

This is a spinoff from Banco Santander SA (SAN), which is the largest euro zone bank (based in Spain). Santander Consumer is focused on providing financing for car purchases and has long-term relationships with automakers like Chrysler, Ford (F), General Motors (GM) and Toyota (TM). There are also a variety of partnerships with online operators, such as,, Kelley Blue Book, and eBay’s (EBAY) eBay Motors.

For the first nine months of last year, the company posted net income of $581.7 million on $2.8 billion of finance and interest income. And there is likely to be continued momentum in the current year as the US auto market has been on the upswing.

Santander Consumer USA plans to issue 65.2 million shares at a range of $22 to $24 and the lead underwriters include Citigroup and J.P. Morgan.

By the way, SAN stock is one of InvestorPlace’s 10 Best Stocks for 2014.

Tom Taulli runs the InvestorPlace blog IPO Playbook. He is also the author of High-Profit IPO StrategiesAll About Commodities and All About Short Selling. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media,

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