Oscar Health (OSCR 0.47%) lifted the price range of its initial public offering (IPO) on Tuesday. The new pricing is $36 to $38 per each of the 31 million shares being offered, up from the previous $32 to $34. With that enhancement, Oscar Health, a next-generation health insurance provider, stands to reap at least $1.11 billion in gross proceeds from the IPO.
Following the IPO, the company is slated make its debut on the New York Stock Exchange today. Its shares should trade under the ticker symbol OSCR.
Oscar was founded in 2012 and has had a higher degree of visibility than usual for a health insurance company, particularly one that has been privately held until now. Part of this has been the multiyear marketing campaign to give it an image as a "friendlier" and more responsive insurer. Perhaps a bigger deciding factor is the name recognition of its co-founder, Joshua Kushner, who is the brother of Jared Kushner, the headline-grabbing former senior advisor to ex-President Donald Trump.
Oscar is coming to market after a relatively soft year. In 2020, its total revenue slid by 5% compared with 2019, to land just shy of $463 million. This was on the back of earned premiums that declined 3%. The company's net income, meanwhile, deepened considerably to a loss of nearly $407 million, against the $261 million shortfall of 2019.
Nevertheless, in light of the relatively strong star power Oscar carries and the fact that its IPO price was raised considerably, demand should be high for the shares on Wednesday.
According to its latest IPO prospectus, Oscar will use roughly $167 million of the IPO proceeds to retire debt. The remainder is for "general corporate purposes," which might include such activities as technology development and acquisitions.