In light of the global initial public offering market recording its strongest second quarter in two decades by volume and proceeds, four stocks that had their IPO during the past three months and outperformed the Standard & Poor’s 500 index benchmark by at least 10% over the past month are Werewolf Therapeutics Inc. (HOWL, Financial), Ecit AS (OSL:ECIT, Financial), Effnetplattformen Holding AB (OSTO:EFFH, Financial) and Rain Therapeutics Inc. (RAIN, Financial) according to the All-in-One Screener, a Premium feature of GuruFocus.
IPO market rockets during second quarter, led by Europe
U.K.-based Ernst & Young said in a July report that global IPO volumes surged during the second quarter, with 597 IPOs bringing in $111.6 billion in proceeds. The results smashed the second-quarter 2007 record of 522 IPOs raising $87.7 billion and are up 206% and 166% in terms of numbers and proceeds compared to the second quarter of 2020.
Ernst & Young said that ample liquidity in financial markets and strong global equity market performance drove “record” IPOs during the quarter. The report further says that the positive performance of the IPO market suggests the global economic recovery is underway although the pace may vary across regions and sectors due to lingering impacts of the Covid-19 pandemic.
As such, investors may find opportunities in IPO stocks with high financial strength and outperformed the benchmark over the past few months. GuruFocus’ All-in-One Screener listed several stocks with an IPO date during the past three months, a financial strength rank of at least 5 out of 10 and a one-month relative to S&P total return of at least 10%.
Werewolf Therapeutics
Shares of Werewolf Therapeutics (HOWL, Financial) traded around $19.27, outperforming the S&P 500 by approximately 30.97% over the past month.
The Cambridge, Massachusetts-based innovative biopharmaceutical company develops therapeutics engineered to stimulate the body’s immune system in order to fight cancer. GuruFocus ranks the company’s financial strength 5 out of 10: Warewolf’s cash-to-debt ratio of 35.52 outperforms more than 61% of global competitors.
Ecit
Shares of Ecit (OSL:ECIT, Financial) traded around 10.6 Norwegian krone ($1.20), outperforming the S&P 500 by approximately 30.41% over the past month.
The Norwegian business services company helps develop, improve and run business finance and information technology setup through a wide range of technologies and customized business solutions. GuruFocus ranks Ecit’s financial strength 5 out of 10 on the back of interest coverage and debt ratios underperforming approximately half of global competitors.
Effnetplattformen Holding
Shares of Effnetplattformen Holding (OSTO:EFFH, Financial) traded around 13.25 Swedish krona ($1.53), outperforming the S&P 500 benchmark by approximately 16.45% over the past month.
Effnetplattformen owns and invests in companies with growth potential, further assisting companies in going from private to public using the company’s structure, capital and know-how. GuruFocus ranks the Swedish asset management company’s financial strength 9 out of 10 on several positive investing signs, which include a double-digit Altman Z-score and no long-term debt.
Rain Therapeutics
Shares of Rain Therapeutics (RAIN, Financial) traded around $17.55, outperforming the S&P 500 benchmark by approximately 11.95% over the past month.
The Newark, California-based clinical-stage company develops therapies that target oncogenic drivers for certain cancers. GuruFocus ranks Rain Therapeutics’ financial strength 5 out of 10: Rain Therapeutics’ cash-to-debt ratio of 115.46 outperforms 73% of global competitors.
