It’s official…the Ant Group sets pricing for its IPO. Today, we’ll take a look at
the details of the pricing and, since it’s not being listed on the US exchanges, I’ll
give you some options on how you can get in on buying some shares either directly or indirectly.
I also have an update on Airbnb as they inch, and I mean inch, closer to their widely anticipated
IPO and how this update could impact the eventual pricing of their shares. And finally, we have
a couple of new companies that have been added to the big list of IPOs coming out this week.
So if you’re ready, let’s get into it… Hey everyone! Welcome back to the channel
that focuses on all of the hot IPOs! We’ve had a busy week on the channel so far, with
us already putting out our weekly IPO This Week episode on Sunday that had 14, yes 14
companies that we covered, and then I put out another video analyzing Palantir and their
share price after their quiet period just ended on Monday, so if you missed those videos,
definitely give them a watch. Today, since I found some time, there’s a few new things
I want to talk about in the world of IPOs, particularly the news on Ant Group. But before
we get to them, I want to quickly talk about a couple of other things, including Airbnb
and two new biotech IPOs, both from Massachusetts, that were added to this week’s calendar
after I recorded IPO This Week. So let’s start there.
The first biotech is one that has expanded into developing treatment for the virus behind
the pandemic and their name is Atea Pharmaceuticals, ticker symbol AVIR. The company is a clinical-stage
biotech focused on developing antiviral therapeutics to improve the lives of patients suffering
from life-threatening viral infections, including this year’s infamous virus, but also conditions
such as hepatitis C and dengue. The company's lead, and most advanced candidate is focused
on the pandemic virus and is currently in a Phase 2 trial with approximately 190 adult
patients; topline data is expected in the first half of next year...which is also when
they anticipate starting their phase 3 clinical trial. As I always say for biotechs at this
stage, there is no revenue to report at this time, as they have no products on the market.
While the pandemic has allowed them to move more quickly on their lead candidate, you
also have to remember that there is a lot of competition in the market. If you’re
interested in Atea, their IPO is set for Thursday, with pricing expected in the range of $22-$24.
Trading would then begin on Friday. The second IPO comes from another clinical-stage
biotech named SQZ Biotechnologies. You want to guess the ticker?
You got it, it’s SQZ. SQZ is developing transformative cell therapies for patients
with cancer, infectious diseases and other serious conditions. They describe their proprietary
technology as Cell Squeeze, a way to physically squeeze cells through a microfluidic chip
that temporarily opens the cell membrane and enables biologic material of interest to diffuse
into the cell, which sounds pretty cool to me. Its most advanced candidate is currently
in a Phase 1 trial for HPV-positive tumors, with initial data expected in the second half
of next year. So they are clearly another early stage biotech with no products on the
market, and none that will make it anytime soon. However, they have partnered with Roche
and have received some revenue from them for developing their lead candidate as part of
the partnership. The company also looks to hold their IPO on Thursday with pricing anticipated
to come within a range of $16 to $18 dollars; trading would then begin on Friday.
Okay moving on past our new companies, I know there’s a lot of interest in Airbnb and
their anticipated IPO, which we still don’t have a date for yet, but are expecting it
to happen in early to mid December. We’re still waiting to see their public filing and
as soon as they come out with one, you can count on me to start digging into it and put
up a video. But there was some news that could impact the pricing of their IPO that I thought
you might want to be aware of. As reported on Bloomberg.com, Airbnb’s board of directors
has approved a 2-for-1 split of the company’s currently private shares. And another interesting
bit of news from their reporting, they noted that the value of Airbnb shares has increased
10.4% from its last valuation listed in compensation reports to the IRS, and that 10.4% gain was
from the end of the previous period, which was unclear if that period was the second
quarter, but most likely the time period it would be. Also according to the article, which
I’ll link for you, the shares were valued at $69.76 each as of Sept. 30, compared with
a value of $63.15 at the end of the previous period. And just to clarify, this price is
before the stock split, so that price would effectively be $34.88 when you then consider
the stock split. I know, you want more details of the IPO and when it’s going to happen,
and I absolutely want to give them to you, but until they file publicly, we’re still
in limbo. But this information might be more helpful than you think once Airbnb finally
IPOs. And that’s because now you have an idea what the share price was valued at on
the private market, and that knowledge can help you get an idea what it might be worth,
or at least help you decide on what you’re willing to pay, once it hits the public market.
So anyway, I wanted to share that information with you and I hope you see the value in it
like I did. I know some of you are still going to be frustrated that I don't have a date
for you...but I'm working on it! And finally, let’s talk about the huge Ant
Group IPO, set to be the world’s largest IPO ever. For some of you that might not be
very familiar with the company, Ant is the blockbuster financial technology company affiliated
with Jack Ma’s Chinese e-commerce group, Alibaba...who, back in 2014 held their own
world-record setting IPO at the time. Ant Group owns China’s largest digital payment
platform, Alipay, which serves over 700 million active users and 80 million merchants. The
company reports that Alipay had $17 trillion dollars, yes, trillion with a T— in transactions
for the 12 months ended June 2020. Beyond Alipay, some of the company’s other offerings
include a wealth management platform, credit reporting and insurance products.
As to financials in US dollars, the company said revenue for the nine months ended in
September rose about 43% to $17.7 billion compared to the same period last year. And
in that same period, gross profit rose 74% to $10.4 billion. So we’re talking big money
and big growth here. As to the IPO itself, Ant Group is set to
raise around 34 billion dollars with its shares being priced at $10.30. If you’re in the
US and are interested in buying into the IPO, unfortunately you’re going to have to work
a little harder to get your shares. Due to tensions between the US and China, particularly
with the US administration threatening restrictions on Chinese companies, Ant made the decision
to list on exchanges in Shanghai and Hong Kong instead of in the US. And this makes
it a lot harder for US investors to buy shares, which I’ll get to giving you some options
on how to do that in a second. As of now, Ant Group is expected to start trading in
Hong Kong on Nov. 5. As for trading its Shanghai shares, I don’t have a date for you yet
on that. Okay, so you’re in the US and you want to
invest in the IPO, so what do you do? Well there are few options you have. The first
is to use an international brokerage account, because unfortunately, most US brokerages
only offer access to the US stock exchanges, like the New York Stock Exchange or NASDAQ,
which obviously won’t have Ant on them. So if you want to buy Ant Group shares, you’ll
need an international brokerage account that allows you to buy and sell shares on overseas
markets. Charles Schwab, Fidelity and Interactive Brokers are all equipped to handle international
trade so you could check there. Also, T. Rowe and UBS Asset Management, as well as Fidelity,
are apparently trying to get in on the IPO, but there’s no guarantee at this time that
they’ll get an allocation. A more indirect way to get a piece of Ant
is to buy shares of Alibaba, which trades on the New York Stock Exchange under the ticker
symbol BABA, so any US brokerage will get you in there. While not a perfect option,
Alibaba is expected to maintain a roughly 33% stake in Ant Group, which allows you to
get exposure to Ant without having to open up a new international account, where you
have become aware of new fees, commissions, and international exchange rates.
Another indirect option is to buy exchange-traded funds that would track the stock. Once the
stock hits the market, you’ll need to look for ETFs that add Ant shares to their holdings.
Obviously you’re looking at ETFs that invest in Chinese companies. You could also look
into Renaissance Capital’s International IPO ETF, if you like investing in international
IPOs in general. If you’re interested in Ant, it is unfortunate
that it’s going to be harder to get in on this IPO if you live in the US. But like they
say, ‘where there’s a will, there’s a way’. Which I have to admit, I don’t
really get that saying. But if you are planning to get in on the IPO, I’d love to hear how
you plan to do it, let me know in the comments. And one last thing, please like the video
if you enjoyed it and want to keep seeing more videos like this. And if you’re new
to the channel or just an occasional visitor, we’d love to have you join the community,
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And with that, let’s wrap it here for now. As always, thank you for watching, and until
next time, have a great day!