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IPO Warriors IPO and LPX Preview for September 26 – September 30, 2022

IPO Warriors IPO and LPX Preview for September 26 – September 30, 2022

September 29, 2022

I decided to delay sending out this week’s newsletter until there was something definitive to report regarding the IPO debut calendar. As most of you know, there has been a bit of a moratorium placed on fresh IPO debuts by NASDAQ as they attempt to sort out the root cause of the extreme pop-and-drop movements we’ve been seeing in recent IPOs, particularly the Chinese variety of F-1 filings that have made relatively ridiculous runs from single to triple, even quadruple digits in single trading sessions. The aim appears to be implementing new rules to curb this kind of volatility, or possibly to ensure that shareholders are not trading shares back and forth between their own accounts to either manipulate prices or launder money.

Meanwhile, a rather obscure IPO (AMV) managed to squeak through the cracks on Tuesday under Regulation A and Regulation CF crowdfunding offerings (so, no underwriters and no recent S-1 filing). We were on top of it and covering the debut in the Premium Discord channel: a few of us hopped in on the debut and caught a monster run from an opening trade of $30 that ripped as high as $300.00 in after hours trading (I was already out for the day when it finally debuted). This one didn’t appear to be any kind of Stealth setup – simply a case of mishandled processing where the majority of shareholders were unable to sell their IPO shares on the debut: so basically a massive logistical oversight by the company, while NASDAQ appears to have been more focused on scrutinizing Chinese debuts. Oh well, clearly the IPO process is not as orderly as we might expect it to be, and not the first time an IPO has been mishandled on its debut (remember GCT? Wasn’t even supported for trading on WeBull after having handed out allocations through WeBull’s IPO Center requests!).

On the bright side, it appears that we DO have at least one confirmed, standard IPO this week, and I’m excited to review it.

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This Week’s IPOs:

  • Laser Photonics (LASE) – September 30, 2022 | 3M Shares

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Harley Davidson Spins Off it’s EV Division Visa SPAC Merger

Harley Davidson Spins Off it’s EV Division Visa SPAC Merger

By Jonathan Michael | September 25, 2022

IPO Warriors Premium | Special Edition: Community Content
Harley Davidson Spins Off it’s EV Division Visa SPAC Merger

I’ve always insisted that the IPO Warriors platform is not really about me as an individual, but is rather, a community of IPO trading enthusiasts ranging from novice to expert level individuals that includes traders, financial managers, brokers, and even underwriters. I certainly don’t consider myself to be an “expert” on anything, and see myself as a hard working researcher who is constantly learning and has gained a ton of experience trading IPOs to the point where I feel I have something to offer those who are interested in a trading strategy that has been highly profitable for myself and many others.

The strength of the IPO Warriors community is indeed in the collective knowledge of it’s members, and the breath and depth of information the is ultimately channeled through the newsletters, weekly live streams, and in the Discord channels continuous to astound me. I feel fortunate to be a member of the IPOW community as the manager/administrator of this platform, and am happy to present this supplementary content provided by an esteemed IPO Warriors Premium member covering a topic that falls just outside of the scope of traditional IPOs: a SPAC that is worth paying attention to when it completes its merger next week:

Contributed by Johnathan Michael
Follow on Twitter:
https://twitter.com/JMTradezxcii

LVW-Harley Davidson LiveWire EV-

Date: September 27 2022 |
Float: Est 5M shares
Price Range:
Pre Merger under IMPX- Current price as of writing $8
Offering Size: $40M
Industry: EV/ESG

Overview: Harley Davidson (HOG) has decided to take their EV Brand LiveWire public via a SPAC merger. I am expecting a large number of redemptions but do not anticipate this being a microfloat. Expecting a relatively small float though around 5M for the initial IPO kickoff date on Tuesday, Sept. 27th. THIS IS OPTIONABLE- a bonus to some SPAC IPOs, which allows you to control your risk while gaining exposure via “allocation” in the form of pre-merge availability under Ticker IMPX. Please note: Ticker changes can cause issues at brokers, you may not have immediate access to shares. If you want to “play it as it lies” I suggest waiting until the day of the ticker change as there is rarely a problem with buying, only selling shares you held pre merge. This is why I like options.

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IPO Warriors IPO and LPX Preview for September 19 – September 23, 2022

IPO Warriors IPO and LPX Preview for September 19 – September 23, 2022

September 21, 2022

Alright, so I had prepared most of the newsletter on Monday, and then Tuesday came along and it appears that NASDAQ has put the low-float IPO game into an ice bath, so we’re unlikely to have any IPOs debut this week (wah, wah, wah-wah)… but let’s not over-react quite yet. What we’ve heard so far is that underwriters have been asked to provide the names and email addresses of the individuals to whom they are allocating shares, and the underwriters are struggling to provide such information due to the fact that they can’t allocate shares until they get NASDAQ approval to proceed with the IPO allocations.

I have received some insights from one broker who provided me with the following information based on a conversation he had with a representative from U.S. Initial Listings at NASDAQ (I’ve been asked to write this in my own language, so this is not a direct quote, but adheres to the material content he provided):

Nasdaq is, indeed, in the process of making some new rules – so they are unlikely approve any listing application (except for SPAC listings) in the next 2-3 weeks. There is no specific time for the suspension, and no one knows exactly how long it will last. They don’t know, at this point, what new rules will be added, and any rules MAY require the SEC’s approval, which might add further delays. They did not provide specifics about what would constitute a “small offering”, but indicated that the suspension would primarily focus on these types of deals. NASDAQ will be watching the situation closely as they prepare new proposed rules, which could affect the offering terms of ensuing deals.

So what can we take away from this? Well, for starters, we can likely pull our allocation requests and either sit on those funds or wait until we hear further updates on the situation.

We can also assume that the Chinese money-moving machine isn’t about to just sit back and wait to see if NASDAQ gives them the green light to resume their goals of transferring money out of China. I’m looking at recent IPOs, secondary offerings, SPACs, and other vehicles that may be potential backup plans for these objectives.

But perhaps the most likely scenario for these deals to find the light of day, is for them to simply list on the AMEX. Anyway, I’ll be providing updates on the situation as I hear anything tangible.

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As for Premium Membership Subscriptions, we’re starting to approach having 100 Premium Subscribers in just the first month since launching the IPO Warriors Premium Membership Platform.

Once we reach 100 Premium Members, I plan to increase the price for new subscriber by roughly 20% for both Annual and Monthly Memberships.
So if you want to lock in the best pricing that will ever be offered, you should consider subscribing before this opportunity gets claimed by others.

I am currently running a promotion to receive 45% off the Annual membership through September 30, 2022 – don’t miss out!

https://ipowarriors.com/ipo-warriors-premium/

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IPO Warriors IPO and LPX Preview for September 12 – September 16, 2022

IPO Warriors IPO and LPX Preview for September 12 – September 16, 2022

September 13, 2022

We have finally reached a point in the year where bulge bracket banks have decided to bring some mainstream IPOs to market: which is a good sign of at least a temporary reprieve in the ongoing slump that has beaten down the market since the start of the year, but far from a sign that there aren’t further down-slides ahead. Regarding the maintream IPOs on the calendar for this week, we tend to see the ‘first-out-of-the-gate’ mainstream IPOs to be priced at a level where there is minimal downside risk to institutional investors, and the pressure for underwriters to avoid a significant drop off the debut is relatively high. I interpret this as reduced risk, but am not necessarily convinced that retail traders are particularly excited about mainstream deals coming to the table right now, as there is far more interest in the low-float names on the calendar this week.

I believe that we may have reached an inflection point in the low-float IPO market with last week’s relatively tame debut of YOSH, and will be approaching this week’s lineup with a bit more caution, both in terms of the allocation requests I placed, and how I am approaching the debut setups of each IPO. I feel that we may have reached a point in the hype cycle around these names where retail has gotten a bit over-heated and ahead of itself, with front-run positions being overloaded while ignoring fundamental risks in the structure of the deals – let alone, no consideration for where the shares are being allocated or any ‘color’ on the deals from sources closer to the books.

We are also seeing what may be SEC scrutiny on some of the Chinese/Stealth IPOs, causing delays in debut that could be a portent of the end of the current run of insanely priced debut premiums that combined untempered hype with shady float manipulations. It would be an unfortunate end to a highly lucrative trade setup, though it does seem that the manipulators of these schemes will find ways to work around any regulatory scrutiny one way or another, and we’ll be on the lookout for these opportunities.

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This Week’s IPOs:

  • Wearable Devices (WLDS) – September 13, 2022 | 3.6M Units

  • Know Labs (KNW) – September 14, 2022 | 3M Shares (uplisting*)

  • Jupiter Neurosciences (JUNS) – September 15, 2022 | 2.5M Shares

  • Corebridge Financial (CRBG) – September 15, 2022 | 80M Shares

  • Third Harmonic (THRD) – September 15, 2022 | 9M Shares

  • Lichen China (LICN) – September 16, 2022 | 6.25M Shares

* Generally I don’t cover OTC uplistings unless I see something particularly compelling about them, which is why I’m not reviewing LNKB this week. Perhaps it runs, it’s lowish float (4.6M shares) but I understand far less about these setups and even less about bancorps, so gonna let this one pass.

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Ok, Let’s jump in:

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Lockup Period Expiration (LPX) Watch:

Most IPOs are subject to either 90 or 180 day lockup periods before insiders and shareholders who owned shares of a company prior to the IPO can sell their positions. Typically, the dilutionary effect of this event will cause a stock price to drop, as supply increases without any fundamental changes in the value of the underlying company. Many investors will wait for LPX before starting a long term position in a company.
Conversely, with low-float IPOs, we often see press releases and other announcements dropped going into, or slightly following LPX, presumably as insiders attempt to drive up the share price before they are able to exercise their warrants and sell their shares.

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IPO Trading Review for the Week of September 5, 2022

IPO Trading Review for the Week of September 5, 2022

September 12th, 2022

The IPO market saw one debut last week that demonstrated what happens when a deal is almost entirely booked by retail flippers. It still managed to debut at a nice premium, though far short of what hopeful allocation recipients had been dreaming of the night before, and it even delivered a nice upside move on the opening volatility, showing that day traders are,or at least were, eager to jump into anything IPO related in this market. But clearly, the fever pitch that has surrounded IPOs ever since HKD ran to absurd levels in early August it getting to a point in the cycle where these setups are getting frontloaded: and that’s when a trade setup starts to get washed out.

Of course, I had said that after ONFO and JFBR failed to produce any upside value for IPO buyers, and then ATXG reset the whole cycle with a run that matched HKD’s historic ascent int a single day of trading. So there’s nothing to say that we can’t see more pyrotechnics come to market in the near future – but we can see that underlying fundamentals can be simply tossed out the window.

We are also starting to hear news of several mainstream IPOs entering the pipeline: an indication that the market may be poised for a bit of stabilization or even a turnaround – bulge bracket banks tend to coordinate large scale IPOs with upswings in the market, and the more established underwriters are likely feeling a bit of pressure to get some deals done before the end of the fiscal year.

So we should expect a healthy dose of IPOs over the next few months – there will almost certainly be some low-float IPOs that rip, but I expect that as the cycle gets played out, the more ‘normal’ ones that are taking advantage of this hysteria to dump shares on retail traders will begin to fail. I’ll be digging deep into the deal structure and hustling behind the scenes to gather as much ‘color’ as I can to best identify the potential runners, as well as which ones are best avoided, and allocating risk accordingly.

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Ok, Let’s take a look at what happened last week in IPO Land:

Yoshiharu Global (YOSH) – September 9, 2022 | 2.9M Shares +1.31M Shares Offered by Existing Shareholders
IPO Price: $4.00
Debut Price: $5.20
Day 1 High: $6.50
Day 1 Low: $3..88 (after hours)
High Since Debut: $6.50
Low Since Debut: $3.88

Day 1 Action: This deal may have actually suffered from having too much focus on it for too long, as every day trader and IPO flipper in the market had keyed in on it and gone in for relatively heavy allocations (at least, far heavier than they would have for this kind of business and this kind of IPO). With so much demand, the first thing the underwriters did that weakened the potency of this deal, at least from day-traders’ perspectives, was to add 500k shares to the float in a last-minute upsizing of the deal. At least they left the price down at the low end of the scale, as it priced at $4.00, leaving plenty of room for a debut premium.
Despite delivering the highest volume of shares traded in the opening minute of any of the low-float IPOs we’ve seen come to market since the HKD Event, with over 1.5M shares exchanged in the first minute of trading, YOSH managed to debut at $5.20: a relatively tame debut, but there was a time when making nearly 25% in an instant by dumping IPO shares at the debut was considered a nice profit.
The stock dropped slightly off the opening print, hitting as low as $4.48 in the opening minute, before rebounding into a halt at $5.42. I had suggested “laddering down” as an entry strategy on my live stream: an approach whereby you set a series of limit orders below the debut price to build better cost basis off the opening drop, in order to capture additional profits on a rebound. This would have been an ideal method of establishing a debut trade position at or below the $5.00 mark, which would have sweetened any gains taken on the ensuing reversal.
I had added to my IPO allocations on the debut, and sold out of most of my positions on the opening of the first halt up – exiting at $5.98: not a home run, but enough to close out a decent win on an IPO trade that I considered to have little downside risk as both an allocation or as a debut trade.
The stock would climb ouf of the halt to a high of $6.50, halt down wards to open and drop as low as $5.05, snap back up to $6.15, and then begin to fall-off: stepping through a series of knives down to a bottom at $4.16: still keeping its head above water for IPO buyers.
On the live trading stream, I mentioned that there was a high likelihood that this would rebound to VWAP at some point, so any bag holders should consider that opportunity as a good time to exit with minimal to no damage – by the time it did, VWAP had dropped to $5.31, and the stock managed to just barely break that mark at $5.39: still, for debut traders who picked hopped in at $5.20, they were given ample opportunity to exit with a non-loss, and savvy traders who found themselves stuck underwater, could have reduced their cost basis to realize even a small win out of what had become a losing situation.
Once it touched VWAP, the momentum died, and YOSH spent the rest of the day trailing off to a low at $4.11, before closing at $4.17, and dropping further in after hours to as low as $3.88 – a drop that saw the share price break below issue for the first time since YOSH debuted. Over 21M shares were traded on Day 1.


Day 2 Action: Day 2 is Monday.

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IPO Warriors IPO and LPX Preview for September 5 – September 9, 2022

IPO Warriors IPO and LPX Preview for September 5 – September 9, 2022

September 5, 2022

While ‘Bulge Bracket’ banks (top tier underwriters) have been starved of any IPO action in 2022, with Chobani announcing the withdrawl of it’s IPO after initially filing to go public last November, the demand for lesser-known companies offered by second-tier underwriters has been white hot ever since HKD re-wrote the history books. And just when it seemed like the trading cycle had peaked in terms of hype and euphoria around the low-float setup, little known ATXG sneaked onto the calendar as an uplisting, and again reset expectations as to the possible limits for an IPO to achieve in a single day of trading, running from a low at $12.95 to an after-hours high of $1,999.99 in a single trading session. Sympathy moves in SHPH and BIAF have already shown the FOMO/MOMO effect that this even has had in refueling the fire in IPO trading, and we’re likely to see this trend continue again, until we stack up a few losers, as we had done going into last week.

Even deals with warrants have run: SHPH wasn’t really a warrants deal: the warrants executed automatically at the open of trading the commons, so it more like 2-shares-for-1 unit. But BIAF was a 2x warrants deal, that one ripped on the open. Granted, it was hot on the heels of SHPH and ATXG, but if that one can run, there’s reason to think that the next IPOs in the lineup can run as well. But does that make it a risk-free setup to go request as much of an allocation request as possible for the upcoming IPOs offered on WeBull? Perhaps, but there are certainly some potential pitfalls, and we’ll be breaking those down in this week’s detailed analysis.

The bigger elephant in the room is the distinction between the standard low-float IPOs and the Chinese/Asian IPOs: and within the latter, those that are truly ‘Stealth IPO’ setups vs those that are just riding the coat tails of the trend and using this opportunity to dump shares on US retail traders. While it still makes sense to allocate for as many shares as possible for any offerings brought to market by ‘usual suspect’ underwriters for these setups, the debut trade is getting far more risky, but with proper risk management and by following the clues we get in pre-debut indications and with background color we gather from the Street, we can make better informed decisions on how to trade these (presuming we’re only able to get limited to no IPO allocations).

The last point worth making here at the start of the week, is that we’re very likely to see additional IPOs added to the calendar by Friday: as underwriters scramble to be the next in line: with a window of opportunity to capture this unique moment in the IPO trading frenzy, which is likely to bring us increasingly dubious offers in addition to the possibility of highly lucrative Stealth setups added at the last minute. We’ll have to stay on our toes to catch the winners and avoid the losers, but it’s well worth the effort in this market: you gotta cast lures while the fish are biting!

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This Week’s IPOs:

  • Jupiter Neurosciences (JUNS) – September 7, 2022 | 2.5M Shares

  • Wearable Devices (WLDS) – September 9, 2022 | 3.6M Units

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Ok, Let’s jump in:

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Lockup Period Expiration (LPX) Watch:

Most IPOs are subject to either 90 or 180 day lockup periods before insiders and shareholders who owned shares of a company prior to the IPO can sell their positions. Typically, the dilutionary effect of this event will cause a stock price to drop, as supply increases without any fundamental changes in the value of the underlying company. Many investors will wait for LPX before starting a long term position in a company.
Conversely, with low-float IPOs, we often see press releases and other announcements dropped going into, or slightly following LPX, presumably as insiders attempt to drive up the share price before they are able to exercise their warrants and sell their shares.

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