The IPO season in the first half of 2019 was one of the busiest in history. We recently looked back at the largest IPOs in the first six months of this year; today we focus on major IPOs that can take place in the second half of the year.
Although it is not possible to perform due diligence for an IPO without the S-1 submission, we try to get a first impression of the IPO market that is ahead of us and focus on the analysis of each company. As the S-1 entries become available, we also cover them separately.
The We Company (WeWork)
Last valuation: $ 47 billion (2019)
WeWork started with a simple concept of shared workspaces, renting out office space and offering flexibility and built-in facilities. If a company needs an office for a few people and / or a short period of time, WeWork can keep it flexible on the time and space it needs while delivering office supplies to employees.
The biggest question revolves around the WeWork business model. The company is said to have lost $ 1.9 billion in revenues of $ 1.8 billion in 2018. WeWork claims that the losses are part of the investment in future growth, and while that may be true, $ 47 billion seems to be a high valuation for a real estate company. deep in red ink.
WeWork submitted its S-1 application to the SEC in December 2018, but there is no immediate timeline for the IPO. Investors will have to wait a few weeks before the actual IPO before they get access to the financial history.
Airbnb
Last valuation: $ 38 billion (2019)
Another star in the so-called sharing economy, Airbnb has been the subject of IPO rumors for at least a year. However, the wait can soon be over. With the stock market at a historic high point, this would be an ideal time for Airbnb to offer its shares to the public.
Airbnb allows individuals to earn extra income by receiving guests in their homes. It has become hugely popular in recent years and hosts are said to deliver 2 million people per night. Financially, Airbnb appears to be in good shape after it reported more than $ 1 billion in revenue in the third quarter. In addition, Airbnb is said to have had a positive EBITDA in the last two years, strengthening its position as a sustainable and profitable company.
It has not yet submitted its S-1, but once it does, the company can be made public within a few months.
Palantir
Last valuation: $ 25 billion (2015)
Palantir is a rather closed data mining and analysis company, working for both governments and private customers. It analyzes huge amounts of data and finds useful information in what would otherwise be considered as noise. Rumor has it that the US government helped Osama Bin Laden in 2011. Palantir was established in 2005, so an IPO is too late.
The company reportedly generated nearly $ 1 billion in revenue last year and reduced its losses to around $ 30 million. The sales growth would be around 40%, which is an impressive number for a reputable company. More recent estimates have made Palantir & # 39; s valuation as high as $ 41 billion in 2019.
An IPO from 2019 is not guaranteed for Palantir. The company probably needs to overhaul its finance department and hire an experienced CFO before submitting its S-1. Nevertheless, some early investors are demanding liquidity and the current IPO window may be too good to pass up.
Platoon
Last valuation: $ 4.1 billion (2018)
Fitness equipment maker Peloton is preparing for a stock exchange launch in 2019. At the beginning of June, the company announced it had submitted its S-1 confidentially to the SEC. Peloton sells stationary bikes and treadmills with large touch screens, so that users can connect to classes. The bikes cost almost $ 2,000 and buyers also have to pay nearly $ 500 annual membership fee to access lessons. It is said that 400,000 bicycles have been sold so far and the revenues for the last fiscal year would amount to more than $ 700 million, nearly double the $ 370 million in revenue it brought in last year.
Peloton sells more than bicycles. It also sells community and status. In the long term, however, the question remains whether the company can scale up to millions. Is it something more than a glorified fitness company? We will get the answers as soon as we receive the S-1 request, but our first assessment is that Peloton is the type of company that loves Wall Street in an irrational way.
