3 New Issues IPO Investors Need to Know About for This Week

Clinical-stage biopharma Achaogen, oil transporter Diamond S Shipping Group, and health care tech solutions provider Castlight Health will all hit the market over the coming days.

Mar 9, 2014 at 2:00PM

Marching more deeply into March, initial public offerings are keeping up the accelerated pace of recent times. Three notable new issues hoping to bring in over $50 million from their IPOs will make it to market this week. As with so many fresh flotations over the past year or so, one of the three is a pure-play biotech firm, while the second promises health care cost saving through its technology. The third is an oil and petroleum products transport firm; although that segment hasn't seen many new stocks coming to market of late, this firm is plugged directly into the energy sector, a stock market favorite at the moment.

We do have to caution, though, that IPO investing carries above-average risk. That's because initial stock prices can be far from the value the market eventually puts on the company's shares. Of course, this situation provides immense upside potential ... though it also presents the chance of losing a big chunk of an investment.

Moving on, let's take a look at this week's notable market debuts.

Achaogen
This clinical-stage biopharma's efforts are devoted to the development of state-of-the-art antibacterial substances to treat certain types of multi-drug resistant infections. It has high hopes for its pipeline drug, plazomicin, which it plans to bring to market via a new drug application to the Food and Drug Administration. Financially speaking, Achaogen was in the red in fiscal 2011 and 2012, and also reported a loss across the first nine months of last year. That trend might change, and dramatically so, if plazomicin comes to market before long and proves to be popular.

The company's stock is slated to start trading Wednesday on the Nasdaq under the ticker symbol AKAO. It is priced at $12 to $14 per share, and 5 million shares will be offered. The lead underwriters of the issue are Credit Suisse, and Cowen Group's (NASDAQ:COWN) Cowen and Company.

Diamond S Shipping Group
For investors looking for a somewhat alternative way to play the energy sector, this company might be worth keeping an eye on. As its name implies, Diamond S Shipping Group is a firm that concentrates on the seaborne transport of oil and other petroleum by-products. According to the company, it is "one of the largest owners and operators of modern medium range ... product tankers in the world." Its fleet comprises 33 of those big vessels, and partly with the proceeds of its IPO it plans to buy ten more. In its last fiscal year, the company's predecessor firms collectively brought in a net profit of $11 million on revenue of $176 million. 

Diamond S Shipping Group will hit the market on Wednesday, listing on the New York Stock Exchange under the ticker symbol DSG. 14 million shares will be for sale, and the price has been set at $14 to $16 per share. Bank of America (NYSE:BAC) Merrill Lynch and Leucadia's (NYSE:LUK) Jefferies are the lead underwriters of the offering.

Castlight Health
Do you prefer investing in health care, or in tech? With this company, no choice need be made. Castlight Health brings in the bulk of its revenue by offering subscriptions to what it describes as its "cloud-based software that enables enterprises to gain control over their rapidly escalating health costs." According to the firm's data, health care spending by American employers is expected to hit $620 billion this year, so there are plenty of costs to control. As to be expected for a young tech company, the firm is light on revenue and heavy on net losses at the moment.  But its products are compelling, and the timing is good for those offerings. 

Castlight Health is slated to debut on the market Friday, trading on the NYSE under the ticker symbol CSLT. 11.1 million shares of class B common stock are being sold at a range of $9 to $11 apiece. Investment banking war horses Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS) are the lead underwriters.

1,000%-plus returns
They said it couldn't be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Eric Volkman has no position in any stocks mentioned. The Motley Fool recommends Bank of America, Goldman Sachs, and Leucadia, and owns shares of Bank of America. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers