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Thrift-store operator Savers Value Village Inc.’s stock soared 37% in its trading debut Thursday, but two other new deals floundered, suggesting investors remain somewhat wary of new offerings.
Bellevue, Washington-based Savers Value Village Inc.
SVV,
appeared set for gains after it priced late Wednesday above its proposed range.
But both Texas-based Kodiak Gas Services Inc.
KGS,
and Fidelis Insurance Holdings Ltd.
FIHL,
fell in early trades after pricing below range and making other accommodations to get their deals through.
Bermuda-based Fidelis, a reinsurer, downsized its deal to 15 million shares from previous expectations it would offer 17 million. The initial public offering priced at $14 a share, below the proposed $16 to $19 range.
Maker of oil- and gas-production equipment Kodiak opened almost 3% below its issue price of $16, which was well below its proposed price range of $19 to $22.
The deals come after two recent IPOs — both of restaurant chains — were greeted with euphoria, raising hopes the market was finally thawing after a deep freeze.
Just 50 IPOs have priced so far this year, according to Renaissance Capital, a provider of IPO exchange-traded funds and institutional research. That’s up 28% from the same time a year ago, when the market was static.
Total proceeds raised come to $8.5 billion, up more than 100% from a year ago but well below the levels seen in 2021 and earlier.
Renaissance Capital
That was meant to change after two recent IPOs: those of Cava Group Inc.
CAVA,
an unprofitable Mediterranean-style fast-casual chain that went public in early June at $22 a share and was last traded at $42.99, and Gen Restaurant Group Inc.
GENK,
a profitable Korean barbecue chain that went public Wednesday at $12 a share and was last quoted at $15.33.
Investors were hoping those deals might entice issuers from other sectors that have been absent for some time, such as tech.
See now: Money-losing food chain Cava showed IPO success. Is it finally time for some tech deals?
Savers Value Village has the advantage of being the biggest for-profit thrift-store chain in North America. The company has 317 stores that operate under different names.
The company is profitable, with net income of $11.9 million in the quarter through April 2, after a loss of $10.2 million in the same period a year earlier. For all of 2022, it had net income of $84.7 million, up from $83.4 million in 2021.
Revenue for the quarter came to $327.5 million, down from $345.7 million in the year-ago period. Revenue totaled $1.4 billion for 2022, up from $1.2 billion in 2021.
Kodiak, meanwhile, had a loss of $12.3 million for the quarter through March 31, on revenue of $190.1 million.
Fidelis had net income of $1.7 billion in the quarter through March 31 on revenue of $2.05 billion, but that was mostly due to a one-time gain from a related party that handles original, underwriting and claims management.
The Renaissance IPO ETF
IPO,
has gained 30% in the year to date, while the S&P 500
SPX,
has gained 14%.
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