Despite what appeared to be warmer conditions in the market last week, all but one IPO was either pulled or rescheduled, including the one mainstream IPO that ventured to test the waters of what has been an ice cold environment for new public offerings. This indicates that despite a rally that saw many of last the last two years’ blockbuster IPOs back from all-time-lows, we may be in for more weakness on the short term horizon.

However, the one IPO that did come to the table (GSUN), provided a reminder that there are still plenty of upside opportunities to be found in IPO land that can be played with a high level of conviction for substantial profits within the first two days of trading (although there has been a recent trend where these plays have taken a week or longer to manifest profits… ahem, PEV). This week we’ll be revisiting last week’s rescheduled IPOs with an added degree of skepticism, along with a new addition to the lineup from the same underwriter that brought us last week’s winner: so there’s plenty of potential opportunity on the agenda for this week.

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Reminder: IPO Warriors is moving to a Paid Subscription model on July 17, 2022 in order to allow me to focus more time and energy into the research, information, analysis, and trading ideas surrounding upcoming and recent IPOs.

Membership will be limited to just 300 subscribers, and significant discounts are available to those who sign up BEFORE July 17, 2022.

Click Here for Details

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This Week’s IPOs:

• Ivanhoe Electric (IE) – June 28, 2022 | 14.4M Shares
  

• Warrantee (WRNT) – June 29, 2022 | 2.14M Shares
  

• bioAffinity Technologies (BIAF) – July 1, 2022 | 1.5M Units

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Ok, Let’s jump in:

Ivanhoe Electric (IE) – June 28, 2022 | 14.4M Shares
Price Range: $11.75 – $12.50
Offering Size: $175M
Shares Outstanding: 92.6M

Industry: Mining and Energy Storage

Overview: This IPO was scheduled to debut last Friday, but appears to have had trouble filling their order book, with shares being offered for allocation request to WeBull traders: not really a great look for a company that was courting institutional investors for this mainstream IPO. Ivanhoe is a metal mining company operating in America and overseas, and sells related technologies to other miners.

Considerations:
Here’s what I wrote last week:
”I almost hesitate to label this as a “mainstream IPO” given that the lead underwriter is BMO Capital – an outfit that hasn’t been the lead underwriter on any IPOs in the past 12 months, but with Jefferies and JP Morgan attached, along with the substantial size of the deal, it’s certainly not a shady second-tier offering.
With that in mind, I do tend to like mainstream IPOs that debut in a cold market, especially if they come out right when the market is entering a reversal off bottoms. When the market is red-hot, for example in the second half of 2020 and first half of 2021, virtually every IPO debuted trading on the public markets with an incredible premium to the IPO price. A prime example: SNOW opened trading at $245 after pricing the IPO at $120 (which was way above the initial projected range). It still gave us an opening run up to $320 before reversing, and provided substantial upside from there over the next couple months (before receding since then to hit prices below even the IPO price, along with the rest of growth stocks).
In contrast, weak markets are anemic for IPOs, which means that when a mainstream IPO comes along and is willing to brave the chill of frosty market conditions, we get more reasonable pricing relative to traditional valuation. The underwriters still need to deliver a modest upside to their institutional investor clients, so we tend to see pricing fall within or below range, and retail demand is typically subdued a bit, so we don’t get extreme debut premiums. Looking back at EE and PFHC, we saw both of them provide debut entries with little downside risk, and while EE didn’t really offer much upside profit either, it did give debut buyers plenty of outs in the first 3 days of trading, while PFHC offered a nice little run on Day 1.. and broke out for a more profitable rally over the weeks following the IPO.
Beyond the market conditions, this company is a mining company and in addition to gold and silver, they mine metals that are used in electric vehicles, and that’s something that’s heavily in the spotlight these days. The float is pretty small for a mainstream IPO as well, and their growth numbers are rather impressive.
JP Morgan also tends to leave at least a little bit of meat on the bone for retailers to pick at.”

Since then the company rescheduled to this week, got trolled on CNBC by Jim Cramer, and offered allocation requests to retail traders on WeBull. I can’t really read any of this as being particularly bullish. If allocation requests on WeBull were substantial, then Cramer was most likely correct in his forecast of the debut, but there may be opportunity to trade this one off a hard drop on the opening, especially if this one prices at the low end of the range. I also wonder if the underwriter simply wasn’t up to the task of nailing down an anchor investor to hold down this deal or why they otherwise struggled to fill the order book for this IPO, but if inexperience on behalf of the underwriter was any factor in delaying this IPO, perhaps we get a relatively ‘fair’ price on this stock once it starts trading.

Remember also that Mr. Cramer, as much as I respect the man, about the DIDI IPO, “I would try to get as many shares as you can.” Well, that was perhaps the worst mainstream IPO I’ve ever witnessed, and one of only two IPOs where Etrade allocated any shares to me (thankfully, it was only a small request to begin with).

Growth Numbers:
– Revenue Growth: +333% for 3 months ending March 31, 2022
– Gross Profits: +440% for 3 months ending March 31, 2022
– Gross Margin: 99% for 3 months ending March 31, 2022

Baseline Financials:
– Cash Flow: negative – improving
– Net Income: negative – improving
– Operating Profit: negative – improving

Notes from the S-1:
–
Underwriters: BMO Capital Markets, Jefferies, JP Morgan

IPO Classification: Mainstream IPO

Recent Similar IPOs: EE PFHC

Trading Strategy:
Here’s what I wrote last week:
“If the market is strong this week, and there is a buy-side imbalance with not too heavy of a debut premium, I like this IPO for a $1-2 upside to the debut price, and possibly more. Similarly, if we see it price at the low end of range, and debut below that, I like the chances of a move back up to and beyond the IPO price (the underwriters are likely to protect the price anywhere below the IPO price).|”

Now that it’s been rescheduled, and Cramer has officially denounced it, on top of a potentially high allocation to retail traders, it doesn’t appear on the surface that this IPO is going to attract retail traders in the volume that results in significant upward price momentum. If I were to trade this in any capacity, I’d likely need to see it price below range, debut below IPO price, and downside movement from there on the debut. At that point we would expect the underwriter to be forced to protect the price from total collapse, and once panic sellers have evacuated their positions, we could see a bounce back to the IPO price by Day 2. Otherwise, I’m not too excited with this one.

Brand Name Recognition: Moderate.

Debut Trade Conviction Level: Moderate-High.

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Warrantee (WRNT) – June , 2022 | 2.14M Shares
Price Range: $6.00 – $8.00
Offering Size: $15M
Shares Outstanding: 12.14M

Industry: Marketing

Overview: This is a Japanese marketing /market research company that operates a business model whereby they facilitate free healthcare and product insurance (mostly on appliances) to individuals who then subsidize their benefits by authorizing the use of their data to the providers of those services. The website reads like a new-age utopian model of commerce, with opening lines such as, “In order to realize a “sustainable society,” we offer services that make it easy for people to pursue a comfortable lifestyle and maintain or recover their health.” .

Considerations: Were it not for the underwriter being Network 1 Financial, the same company that brought us GSUN last week, I’d simply chuckle at the suggestion that this company could raise enough buyer demand to go public on the NASDAQ under these market conditions. But when you bring in Network 1 Financial combined with an ultra-low float, and a company that’s based out of Asia, I have to take notice as a potential Stealth setup. Actually, their financials aren’t nearly as bad as some other recent low-float IPOs from lesser-known underwriters, but let’s not kid ourselves here: if you’re watching this one with the intention of taking a position on the opening print if we see a high debut premium, then you’re not really weighing traditional valuation metrics in your analysis of this company. It’s either going to have a tightly constrained volume that produces a substantial pop once shares start trading, or it’s going to be a bomb that drops in half or worse.
WRNT was available for allocation request on WeBull, and I put in a small order request to gauge whether retail traders would be given large portions of the float – how much of my request gets assigned will give me further insights as to whether it makes sense to add to my position on the debut or not.

Growth Numbers:
– Revenue Growth: +22% for 6 months ending September 30, 2021
– Gross Profits: +27% for 6 months ending September 30, 2021
– Gross Margin: 99% for 6 months ending September 31, 2021
…I don’t recall ever seeing gross margin numbers that high before.

Baseline Financials:
– Cash Flow: positive
– Net Income: negative
– Operating Profit: negaive

Notes from the F-1:
– “We have had only 11 customers and associated marketing campaigns to date”
Ok, so it’s a small company with not a lot of customers, noted.

– “The number of common shares to be outstanding immediately after this offering does not include: (a) up to 321,429 ADSs issuable upon the exercise in full by the underwriters of their option to purchase additional ADSs from us, and (b) up to an aggregate of 1,036,500 common shares issuable upon the exercise of stock options outstanding immediately after the completion of this offering, at a weighted-average exercise price of JPY110.37 per share.”
My math comes to roughly 1.36M additional shares that will be added to the float once the offering is completed… bringing the total float to nearly 3.5M shares.

Underwriters: Network 1 Financial

IPO Classification: Potential Stealth IPO

Recent Similar IPOs: HTCR

Trading Strategy: This one is a little tricky because it is missing one key ingredient for a traditional Stealth IPO – the obvious connection to China. As this is a NASDAQ listing, we should be able to see the debut premium at which this stock will begin trading on WeBull (mobile or desktop apps). If we see a debut premium in the $11-17 range, I feel fairly confident that we will see halts to the upside off the opening print. If it debuts essentially at or below the IPO price, then we’re likely to see retail traders panic sell it down further. At that point, I will look for an opportunity to take a position towards the end of the day should the stock fail to produce any kind of substantial rally, and be prepared to sell in the early pre-market on Day 2 if we get a spike.

Brand Name Recognition: Low.

Debut Trade Conviction Level: Tempered enthusiasm.

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bioAffinity Technologies (BIAF) – July 1, 2022 | 1.5M Units
Price Range: $6.75
Offering Size: $10M
Shares Outstanding: 7.5M

Industry: Biotech

Overview: Rescheduled from Jun 22, 2022. This is a diagnostics company focusing on non-invasive diagnosis of early-stage lung cancer and other lung diseases. They are per-revenue, and their lead diagnostic test is slated for FDA submission in Q3 2022, and expected to take 2-3 years.

Considerations: Here’s what I wrote last week:
”This one doesn’t have anything particularly enticing about it, the price point at $6.75 offers plenty of downside, as it likely comes down to the $2 zone as demand disappears once the IPO concludes; the Units mean there are warrants issued alongside the common shares in the offering and almost guarantees a debut below the IPO price; and the underwriter has not sponsored an IPO in the past 12 months. Ostensibly, short term catalysts tied to the company’s lead candidate seem to be relatively distant in the future. Having said that, when it’s ultra-low-float, and it appears bad on the surface, any kind of manipulation in the trading volume could produce volatility: as we saw with HSCS last week, the Day 2 runner can emerge at any moment: particularly when we least expect it, so I’ll at least be keeping watch on this one, albeit from the corner of my eye. In the near-short term, say 180 days, there are some potential catalysts as it aims to proceed with commercialization of its lead candidate “as an LDT under the CLIA program administered by the Centers for Medicare and Medicaid Services”… so with a microscopic float, any positive headline could trigger a run to the exercise of the warrants (see below in the S-1 notes).”
I don’t think anything has substantially changed here, except that it’s been moved to a Friday, which puts it in line to perform according to the typical “Biotech Bust” seem to gravitate towards the back end of the week.

Growth Numbers: none: it’s pre-revenue

Baseline Financials: with no revenue, they’re all negative.

Notes from the S-1:
– 14 of our current stockholders have indicated an interest in purchasing Units in this Offering and we currently anticipate they may purchase approximately 6.2% of the Units in this Offering not assuming the exercise of the Over-Allotment Option
Actually, this is kind of rare, and since they already control 46% of the voting power of the common stock, the float is likely to be restrained.
– Having completed the CLIA analytical validation, Precision Pathology is offering the CyPath® Lung test for sale with a controlled rollout beginning in Texas, which we anticipate will require six months, before expanding throughout the Southwest region of the U.S. through the first half of 2023. After establishing CyPath® Lung in the Southwest market, the laboratory will expand sales in 2023 to additional states with plans to market the test nationwide.
This aligns very nicely with a 180-day LPX, and warrant EP of 120% of the IPO price, ($8.10 based on the IPO price of $6.75). Keep that in mind if you want to pick this up on any pullbacks prior to LPX.

Underwriters: WallachBeth Capital

IPO Classification: Low Float Biotech (aka “Biotech Bust”)

Recent Similar IPOs: HSCS (and not TNON… at least I can’t expect it to do what TNON did, which turned out to be akin to a Stealth IPO setup and was priced substantially higher that this one.

Trading Strategy: Nothing’s really changed in my approach to this one, except that I may be even more hesitant to take any overnight position given that the Day 2 move with straddle a weekend.
I’ll be watching this one with no intention of playing it unless:
A) we see a significantly low volume on the opening print with a significant debut premium.
or
B) it tanks as hard as HSCS on Day 1 and falls throughout the day with no real reversal. So basically, it would have to fall below $2.00 into the close of the market, and then I’d take a flier on a possible Day 2 rally.

Brand Name Recognition: Low.

Debut Trade Conviction Level: Low

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Lockup Period Expiration (LPX) Watch:
by Aly Angel: https://twitter.com/tradingfitgirl
Get her Guides! https://tradingfitgirl.net/trading-guides

Most IPOs are subject to a 180 day lockup period 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.

LPX dates June 27th to July 1st
Still in the Grinched X-Mas and bloody January time frame.

Expion360 Inc (XPON)
Type: IPO
LPX Date: 30-Jun-22
LPX Period: 90-day under gen rule
IPO Date: 01-Apr-22
IPO Price: $7.00

Exercise Price: UW 130% list, equal to $9.10 (180-day)
Secondary Offering Exercise Price: n/a

Notes: 90-day LPX is under gen rule only, has 180-day LPX
– Reference 424B4 Filed 04-Apr-22

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No 180-day LPX tickers.

Keeping an eye on several IPOs that are past the 180-day LPX dates.
Will usually have 6-8 weeks past and 4 weeks in the future on watch/ positions.
ALWAYS respect your risk and only get in on the lower side of the channels for longer term holds. And only playing tickers that have an EP (exercise price).
No EP = does not deserve our attention.

If there’s a secondary offering, these often take longer to run.

BEAT – EP $6 – IPO
BJDX – EP $7 – IPO
BLBX – EP $6.25 – Uplist
CING – EP $7.50
HTCR – EP $6.25 – IPO
STRN – EP $4.81 – $5.18 – IPO *has secondary
TIVC – EP $6.25 – IPO

For a full list of IPOs and Uplist LPX dates and video reviews
https://tradingfitgirl.net/always-learning for the direct Spreadsheet Link and YouTube Videos.

This Week’s IPOs:

• Golden Sun Education Group (GSUN) – June 22, 2022 | 4.4M Shares
  

• bioAffinity Technologies (BIAF) – June 22, 2022 | 1.5M Units
  

• Wearable Devices (WLDS) – June 23, 2022 | 3.6M Shares
  

• Mobilicom (MOB) – June 23, 2022 | 2.15M Shares
  

• Onfolio (ONFO) – June 23, 2022 | 1.7M Shares
  

• Ivanhoe Electric (IE) – June 24, 2022 | 14.4M Shares

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Ok, Let’s jump in:

Golden Sun Education Group (GSUN) – June , 2022 | 4.4M Shares
Price Range: $4.00 – $5.00
Offering Size: $20M
Shares Outstanding: 17.4M

Industry: Education

Overview: This Chinese private education company operates a primary school and a secondary school in Wenzhou, China along with a handful of education centers and a logistics company catering to educational centers.

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bioAffinity Technologies (BIAF) – June 23, 2022 | 1.5M Units
Price Range: $6.75
Offering Size: $10M
Shares Outstanding: 7.5M

Industry: Biotech

Overview: This is a diagnostics company focusing on non-invasive diagnosis of early-stage lung cancer and other lung diseases. They are per-revenue, and their lead diagnostic test is slated for FDA submission in Q3 2022, and expected to take 2-3 years.

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Wearable Devices (WLDS) – June 23, 2022 | 3.6M Shares
Price Range: $5.20 – $7.20
Offering Size: $0M
Shares Outstanding: 14.84M

Industry: Wearable Technology

Overview: This Israeli-based company makes a wrist-worn (bracelet) that senses nerve and muscle movements (“Surface Nerve Conductance”) in the wrist to determine finger actions to deliver an electronics control system with potential metaverse/virtual reality applications, as well as remote industry, robotics, smart home, and sports analytics applications. It’s also available for the iWatch, so it’s does have integrations with devices that are already well positioned in the marketplace.


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Mobilicom (MOB) – June 23, 2022 | 2.15M Shares
Price Range: $3.80 – $4.75
Offering Size: $17M
Shares Outstanding: 4.3M

Industry: Drone cybersecurity

Overview: Here we have another Israeli tech company, this one is an uplisting from the Australian stock exchange – the company itself develops combination hardware/software cybersecurity products for drones and UAVS with both commercial and military applications.

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Onfolio Holdings (ONFO) – June 23, 2022 | 1.7M Units
Price Range: $4.50 – $5.50
Offering Size: $15M
Shares Outstanding: 12.92M

Industry: Websites

Overview: This company acquires and manages cash flow positive websites in several industry verticals with 38 websites in their portfolio. They claim to generate over 4M monthly visits across their network, and from a list of case studies published on their website covering companies they decided NOT to buy-out, it seems they find target companies on website flipping platforms, and are considering some companies with less than $100k in annual revenue. The offering is for ‘units’ that consist of one share of common stock and two warrants.

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Ivanhoe Electric (IE) – June 4, 2022 | 14.4M Shares
Price Range: $11.00 – $12.50
Offering Size: $175M
Shares Outstanding: 0M

Industry: Mining and Energy Storage

Overview: This is the first mainstream IPO we’ve seen since May with PFHC and EE in April before that. Ivanhoe is a metal mining company operating in America and overseas, and sells related technologies to other miners.

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… and keep an eye out for another possible Stealth IPO this week. If I spot it, I’ll send out an update newsletter mid-week, so keep an eye on your inbox.

Lockup Period Expiration (LPX) Watch:
Content provided by Aly Angel: Follow on Twitter at https://twitter.com/tradingfitgirl

(LPX Watch will be exclusively provided to Premium Subscribers)

The ongoing market decline that has persisted since the beginning of the year, spurred by inflation which has negatively impacted the market’s appetite for growth stocks, has resulted in a drought of mainstream IPOs, though we’ve had plenty of action in the form of low-float IPOs from questionable companies brought to us by second-tier underwriters. After last week’s Fed action to implement a historically colossal .75% rate hike on Wednesday, the market initially responded with a remarkably positive bounce, which appeared to dissipate on Thursday, but regained momentum going into the long weekend. Some experts forecast further attrition, but it seems we’re starting to hear the first murmurings of having reached a “bottom”. With a pent up supply of IPOs eagerly awaiting more favorable conditions into which they can make the step into the public markets, the sooner that financial environments for growth stocks rebounds, the more likely we’ll have mainstream IPOs lining up to debut their public offerings.

As we’ve seen in the past, mainstream underwriters seem to have a pretty good read on market conditions. When we see mainstream IPOs begin to peak their heads out into the domain of the public markets, we may interpret this as a signal that the market is showing signs of relative strength. We also see that even low-float IPOs tend to be scarce in the worst of times, and the last few weeks produced only a trickle of almost laughably bad companies that chose to debut despite frigid circumstances.

So this week, with no less than 6 IPOs on the calendar, including one mainstream IPO, and possible Stealth IPOs lurking in the shadows, it feels like we might be looking at a turnaround in the market, though how long it lasts is anyone’s guess. Some of the best plays to be looking at if the market shows signs of rebounding are recent IPOs that have been beaten down along with the rest of those labeled ‘growth’: tickers like U, S, SNOW, ABNB, DOCS, PATH, and ARRY have already bounced somewhat from last week’s bottoms, but could rally substantially from here if interest returns to growth at any pace.

But I’m not really trying to call bottoms or take long term positions in this market: I’m focused on trading IPOs this week: with potential Stealth IPO setups, and abundance of ultra-low-floaters, and a mainstream IPO that could provide a relatively fair entry for retail traders, along with a trend of recent low-float IPOs running hard as they hit their Lockup Expiration (LPX), there is plenty of action to be had in IPO land: that’s where my focus will be, and what I’ll be dissecting with the rest of this newsletter.

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This Week’s IPOs:

• Golden Sun Education Group (GSUN) – June 22, 2022 | 4.4M Shares
  

• bioAffinity Technologies (BIAF) – June 22, 2022 | 1.5M Units
  

• Wearable Devices (WLDS) – June 23, 2022 | 3.6M Shares
  

• Mobilicom (MOB) – June 23, 2022 | 2.15M Shares
  

• Onfolio (ONFO) – June 23, 2022 | 1.7M Shares
  

• Ivanhoe Electric (IE) – June 24, 2022 | 14.4M Shares

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Ok, Let’s jump in:

Golden Sun Education Group (GSUN) – June , 2022 | 4.4M Shares
Price Range: $4.00 – $5.00
Offering Size: $20M
Shares Outstanding: 17.4M

Industry: Education

Overview: This Chinese private education company operates a primary school and a secondary school in Wenzhou, China along with a handful of education centers and a logistics company catering to educational centers.

Considerations: I first picked up on GSUN back in May 2021 when it hit my scanners due to the underwriter and the almost flagrantly uninteresting nature of the company. China has been clamping down on private education, as it seeks to force financial parity on its massive population rife with the kind of financial disparity that keeps PNC party leaders up at night. Therefore, the likelihood of this company becoming a highly profitable enterprise worthy of any kind investment is ludicrous. The financials are bad, not to mention, way outdated (provided for the fiscal year ending September 30, 2020), and in case you haven’t heard, China is still enforcing massive lockdown restrictions as it continues to struggle with containing COVID. When I see an underwriter like Network 1 Financial bring a Chinese company public, I’m already sitting on the edge of my seat expecting a Stealth debut, and when the underlying company is this bad, I am simply waiting and hoping that the debut price isn’t out of range for a significant move to the upside: this is the company that brought us TIRX, CNEY, CPOP, AUVI, and way before that – the legendary scam IPO LFIN: perhaps the original Stealth IPO that ran from $6.65 to a high of $142 on Day 2.

Growth Numbers: (ok, gonna run through these as a matter of practice, but if you’re worried about the financial strength of this company in assessing whether to play the IPO debut, you’re significantly misunderstanding the premise of the Stealth IPO setup).
– Revenue Growth: -14% for fiscal year ending September 30, 2020
– Net Income: -98.4% for fiscal year ending September 30, 2020 (yeah, it went from $3.5M to $54k in one year).

Baseline Financials:
– Cash Flow: negative
– Net Income: negative
– Operating Profit: negative

Notes from the F-1:
– Risks: “…it is uncertain whether we or our PRC subsidiaries will be required to obtain additional approvals, licenses, or permits in connection with our business operations pursuant to evolving PRC laws and regulations, and whether we would be able to obtain and renew such approvals on a timely basis or at all. Failing to do so could result in a material change in our operations, and the value of our Class A Ordinary Shares could depreciate significantly or become worthless.”
Essentially, unless China reverses their policy decisions regarding whether private education is allowed to make profits, this company is trash.

Underwriters: Network 1 Financial

IPO Classification: Stealth IPO

Recent Similar IPOs: OST JCSE

Trading Strategy: Like any Stealth IPO, I’m watching first for confirmation that it’s a Stealth setup: evident with a debut price significantly above the IPO price, and second, I’m watching for a playable entry point and lowish volume on the opening print. This can be tricky when allocation requests are available to retail traders on WeBull, as this one is (note: I have put in for a small allocation request: notes on this further down the page).
The specific setup I’m looking for in the pre-debut share balancing, is for volume around 100k shares or less for the opening trade, and a price target no higher than $17.00. As we saw with LYT last week, once we get up to $20 and above, there isn’t much room for an easy upside play off the debut. Since all these setups have historically run down to $2 and lower in the near-future, the downside risk once the share price tops $20 becomes increasingly potent. So for my risk tolerance, a debut price in the $10-$16 range is ideal, and I remind myself not to take such a large position that my buy order can be affecting the opening bid price (more than 1,000 shares and you can be asserting real gravity against your own position).

Brand Name Recognition: Low.

Debut Trade Conviction Level: High.
This is almost certainly a Stealth IPO setup: if it’s a fakeout, well, then good for them, they got us. More likely, the question is simply whether they give us retail traders a chance to buy in at a debut price that is not overly inflated to begin with. They let us get into CPOP at $12.26 before it rocked up to $34.87 on Day 1, then continued to peak at $78 on Day 2. JZXN, on the otherhand, debuted at $45 and crashed down as low as $17.06 on Day 1, reaching single digits on Day 2. Both trade under $1.50 today.

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bioAffinity Technologies (BIAF) – June 23, 2022 | 1.5M Units
Price Range: $6.75
Offering Size: $10M
Shares Outstanding: 7.5M

Industry: Biotech

Overview: This is a diagnostics company focusing on non-invasive diagnosis of early-stage lung cancer and other lung diseases. They are per-revenue, and their lead diagnostic test is slated for FDA submission in Q3 2022, and expected to take 2-3 years.

Considerations: This one doesn’t have anything particularly enticing about it, the price point at $6.75 offers plenty of downside, as it likely comes down to the $2 zone as demand disappears once the IPO concludes; the Units mean there are warrants issued alongside the common shares in the offering and almost guarantees a debut below the IPO price; and the underwriter has not sponsored an IPO in the past 12 months. Ostensibly, short term catalysts tied to the company’s lead candidate seem to be relatively distant in the future. Having said that, when it’s ultra-low-float, and it appears bad on the surface, any kind of manipulation in the trading volume could produce volatility: as we saw with HSCS last week, the Day 2 runner can emerge at any moment: particularly when we least expect it, so I’ll at least be keeping watch on this one, albeit from the corner of my eye. In the near-short term, say 180 days, there are some potential catalysts as it aims to proceed with commercialization of its lead candidate “as an LDT under the CLIA program administered by the Centers for Medicare and Medicaid Services”… so with a microscopic float, any positive headline could trigger a run to the exercise of the warrants (see below in the S-1 notes).

Growth Numbers: none: it’s pre-revenue

Baseline Financials: with no revenue, they’re all negative.

Notes from the S-1:
– 14 of our current stockholders have indicated an interest in purchasing Units in this Offering and we currently anticipate they may purchase approximately 6.2% of the Units in this Offering not assuming the exercise of the Over-Allotment Option
Actually, this is kind of rare, and since they already control 46% of the voting power of the common stock, the float is likely to be restrained.
– Having completed the CLIA analytical validation, Precision Pathology is offering the CyPath® Lung test for sale with a controlled rollout beginning in Texas, which we anticipate will require six months, before expanding throughout the Southwest region of the U.S. through the first half of 2023. After establishing CyPath® Lung in the Southwest market, the laboratory will expand sales in 2023 to additional states with plans to market the test nationwide.
This aligns very nicely with a 180-day LPX, and warrant EP of 120% of the IPO price, ($8.10 based on the IPO price of $6.75). Keep that in mind if you want to pick this up on any pullbacks prior to LPX.

Underwriters: WallachBeth Capital

IPO Classification: Low Float Biotech (aka “Biotech Bust”)

Recent Similar IPOs: HSCS (and not TNON… at least I can’t expect it to do what TNON did, which turned out to be akin to a Stealth IPO setup and was priced substantially higher that this one.

Trading Strategy: I’ll be watching this one with no intention of playing it unless:
A) we see a significantly low volume on the opening print with a significant debut premium.
or
B) it tanks as hard as HSCS on Day 1 and falls throughout the day with no real reversal. So basically, it would have to fall below $2.00 into the close of the market, and then I’d take a flier on a possible Day 2 rally.

Brand Name Recognition: Low.

Debut Trade Conviction Level: Low

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Wearable Devices (WLDS) – June 23, 2022 | 3.6M Shares
Price Range: $5.20 – $7.20
Offering Size: $0M
Shares Outstanding: 14.84M

Industry: Wearable Technology

Overview: This Israeli-based company makes a wrist-worn (bracelet) that senses nerve and muscle movements (“Surface Nerve Conductance”) in the wrist to determine finger actions to deliver an electronics control system with potential metaverse/virtual reality applications, as well as remote industry, robotics, smart home, and sports analytics applications. It’s also available for the iWatch, so it’s does have integrations with devices that are already well positioned in the marketplace.

Considerations: This actually sounds pretty frickin’ cool, but while gimmick along may have worked in the low-float IPOs of 2020 and 2021, this company seemingly just missed the ‘metaverse-hype’ craze that sent RBLX up to $140+ and MMTR as high as $37 in late November 2021 (they currently trade at $26.87 and $4.12 respectively). As far as strong IPO debuts driven purely on the trend and story behind the premise of the company, we haven’t really seen one deliver upside gains off the debut since LITM gave us an opening run from an open at $11.50 to a high at $18.40 on the premise of being a lithium miner (it now trades at $3.24).
While this company does deliver impressive growth numbers in terms of %, the real numbers themselves are rather small ($107k revenue in the 6 months ending June 30, 2021), and as futuristic as their technology sounds, I’m not sure the market is going to get overly excited about grabbing a piece of this company right out of the gate.
Bear in mind that recent high-tech IPOs out of Israel have not performed particularly well either: with MTEK and to a lesser-degree: SVRE each providing ample opportunity to lose money off their debuts.

Growth Numbers:
– Revenue Growth: +214% for 6 months ending June 30, 2021
– Gross Profits: +233% for 6 months ending June 30, 2021
– Gross Margin: 93% for 6 months ending 31, 2021

Baseline Financials:
– Cash Flow: negative – improving
– Net Income: negative – improving
– Operating Profit: negative – improving

Notes from the F-1:
– A significant amount of the funding from the IPO will go directly towards manufacturing and marketing their “Madura Band” for the Apple watch. Which is pretty encouraging IF this product catches on, but not really a factor that can be assumed as fact at the time of their IPO.
This also reminds me that we’re in the midst of a serious supply-chain crisis, and the likelihood of production delays seems almost certain.

Underwriters: Aegis Capital

IPO Classification: Low Float IPO

Recent Similar IPOs: MTEK SVRE

Trading Strategy: I don’t see this one doing particularly well off the debut: we just haven’t seen anything run off the opening print on story alone, and the float isn’t that microscopic in comparison to the sub-2M float debuts we’ve had recently. It’s been on-and-off-again for a few weeks now, and is still available for pre-order on WeBull, so this is one I’ll watch from the sidelines for now.

Brand Name Recognition: Low.

Debut Trade Conviction Level: Low.

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Mobilicom (MOB) – June 23, 2022 | 2.15M Shares
Price Range: $3.80 – $4.75
Offering Size: $17M
Shares Outstanding: 4.3M

Industry: Drone cybersecurity

Overview: Here we have another Israeli tech company, this one is an uplisting from the Australian stock exchange – the company itself develops combination hardware/software cybersecurity products for drones and UAVS with both commercial and military applications.

Considerations: Military drones have been somewhat in the spotlight due to their use in the Russia/Ukraine conflict; with reports of heavy anti-drone hacking impacts on both sides, there’s an argument to be made that there will be relatively high demand for products in this niche. Given the lower float, lower price point, and more relevant story behind this stock, if I had to pick between WLDS and MOB, I think I’d lean towards MOB (though that’s without knowing where either one will actually debut). This one is also available for pre-order on WeBull, and the underwriter – Think Equity – is somewhat due for an IPO that doesn’t outright dump off the debut. I don’t particularly like uplistings either, so I am pretty hesitant to see this one as debut buy. Perhaps if it gets hyped up on social media, but it’s more likely that the market it still to soft to push any IPO debut on story alone, and this one is just interesting enough to keep it from outright tanking – with a price point that minimizes the downside risk: which ultimately creates a situation where it will rise off dips and sell off any rips to the extent that it maintains a range slightly below the IPO price… until interest wanes and the price gradually descends to the $2.00 level and below. Like MTEK, it could make short-lived runs on small contract or buy-back news down the road, but I don’t see a clear IPO debut trade on this one.

Growth Numbers:
– Revenue Growth: +75% for 2021 vs 2020
– Gross Profits: +80% for 2021 vs 2020
– Gross Margin: 67% for 2021

Baseline Financials:
– Cash Flow: negative – slightly improving
– Net Income: negative – slightly improving
– Operating Profit: negative – slightly improving

Notes from the F-1:
– Risks: expected cost increases to fund R&D

Underwriters: Think Equity

IPO Classification: Low Float IPO

Recent Similar IPOs: MTEK SVRE

Trading Strategy: I’d love to see this one debut with a slight premium to the IPO price, but I doubt that will happen: if we do, I’ll try taking a small position on the debut. Otherwise, the most likely scenario I see playing out is a debut along the lines of MTEK: something like a sell-off, slight reversal that doesn’t quite break out over the IPO price, followed by another sell-off that never gets quite low enough to provide minimal downside risk, and runs that get sold off before the materialize into substantial win opportunities.

Brand Name Recognition: Low.

Debut Trade Conviction Level: Moderate.

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Onfolio Holdings (ONFO) – June 23, 2022 | 1.7M Units
Price Range: $4.50 – $5.50
Offering Size: $15M
Shares Outstanding: 12.92M

Industry: Websites

Overview: This company acquires and manages cash flow positive websites in several industry verticals with 38 websites in their portfolio. They claim to generate over 4M monthly visits across their network, and from a list of case studies published on their website covering companies they decided NOT to buy-out, it seems they find target companies on website flipping platforms, and are considering some companies with less than $100k in annual revenue. The offering is for ‘units’ that consist of one share of common stock and two warrants.

Considerations: First off… two warrants?! Few IPOs have done well off the debut with just one warrant, let alone two warrants, and these are both redeemable at the IPO price, so there’s little chance that this runs much higher than the IPO price before warrant holders start dumping their shares. The company itself is not exciting: basically a bunch of relatively small websites that, individually, would be nowhere near IPO consideration, yet packaged together, somehow justify publicly listing this company on the NASDAQ.
The IPO should basically allow them to go buy even more websites to add to their stable of web properties, though they claim to not have any specific targets in mind. They also haven’t really demonstrated much skill in improving the performance of the websites they’ve purchased, as their growth numbers and baseline financials appear to be universally headed in the wrong direction.
I almost wonder why they’re even doing an IPO.

Growth Numbers:
– Revenue Growth: -25% for 3 months ending March 31, 2022
– Gross Profits: -44% for 3 months ending March 31, 2022
– Gross Margin: 42% for 6 months ending 31, 2021

Baseline Financials:
– Cash Flow: negative – getting worse
– Net Income: negative – getting worse
– Operating Profit: negative – getting worse

Notes from the S-1:
– “As of the date of this prospectus, we cannot specify with certainty all of the particular uses for the net proceeds to be received upon the completion of this offering.”
So basically, you just want some money from investors for the hell of it, and don’t really have any specific plans on what you’re going to do with it, right?
Onfolio: Yeah, that’s about it. but in the meantime,
”Pending the use of the net proceeds of this offering, we intend to invest the net proceeds in short-term investment-grade, interest-bearing securities.
I hope it’s not going into one of those BitCoin services that pays interest on your holdings.


Underwriters: EF Hutton

IPO Classification: Low Float IPO

Recent Similar IPOs: HOUR (sorta, but not expecting this kind of run)

Trading Strategy: With 2 warrants involved, an EP at 100% of the IPO price, and being offered on WeBull, I don’t see how this offers even the hope of any upside.

Brand Name Recognition: Low, but maybe some of the websites they own have limited brand recognition.

Debut Trade Conviction Level: Low.

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Ivanhoe Electric (IE) – June 4, 2022 | 14.4M Shares
Price Range: $11.00 – $12.50
Offering Size: $175M
Shares Outstanding: 0M

Industry: Mining and Energy Storage

Overview: This is the first mainstream IPO we’ve seen since May with PFHC and EE in April before that. Ivanhoe is a metal mining company operating in America and overseas, and sells related technologies to other miners.

Considerations: I almost hesitate to label this as a “mainstream IPO” given that the lead underwriter is BMO Capital – an outfit that hasn’t been the lead underwriter on any IPOs in the past 12 months, but with Jefferies and JP Morgan attached, along with the substantial size of the deal, it’s certainly not a shady second-tier offering.
With that in mind, I do tend to like mainstream IPOs that debut in a cold market, especially if they come out right when the market is entering a reversal off bottoms. When the market is red-hot, for example in the second half of 2020 and first half of 2021, virtually every IPO debuted trading on the public markets with an incredible premium to the IPO price. A prime example: SNOW opened trading at $245 after pricing the IPO at $120 (which was way above the initial projected range). It still gave us an opening run up to $320 before reversing, and provided substantial upside from there over the next couple months (before receding since then to hit prices below even the IPO price, along with the rest of growth stocks).
In contrast, weak markets are anemic for IPOs, which means that when a mainstream IPO comes along and is willing to brave the chill of frosty market conditions, we get more reasonable pricing relative to traditional valuation. The underwriters still need to deliver a modest upside to their institutional investor clients, so we tend to see pricing fall within or below range, and retail demand is typically subdued a bit, so we don’t get extreme debut premiums. Looking back at EE and PFHC, we saw both of them provide debut entries with little downside risk, and while EE didn’t really offer much upside profit either, it did give debut buyers plenty of outs in the first 3 days of trading, while PFHC offered a nice little run on Day 1.. and broke out for a more profitable rally over the weeks following the IPO.
Beyond the market conditions, this company is a mining company and in addition to gold and silver, they mine metals that are used in electric vehicles, and that’s something that’s heavily in the spotlight these days. The float is pretty small for a mainstream IPO as well, and their growth numbers are rather impressive.
JP Morgan also tends to leave at least a little bit of meat on the bone for retailers to pick at.

Growth Numbers:
– Revenue Growth: +333% for 3 months ending March 31, 2022
– Gross Profits: +440% for 3 months ending March 31, 2022
– Gross Margin: 99% for 3 months ending March 31, 2022

Baseline Financials:
– Cash Flow: negative – improving
– Net Income: negative – improving
– Operating Profit: negative – improving

Notes from the S-1:
–
Underwriters: BMO Capital Markets, Jefferies, JP Morgan

IPO Classification: Mainstream IPO

Recent Similar IPOs: EE PFHC

Trading Strategy: If the market is strong this week, and there is a buy-side imbalance with not too heavy of a debut premium, I like this IPO for a $1-2 upside to the debut price, and possibly more. Similarly, if we see it price at the low end of range, and debut below that, I like the chances of a move back up to and beyond the IPO price (the underwriters are likely to protect the price anywhere below the IPO price).

Brand Name Recognition: Moderate.

Debut Trade Conviction Level: Moderate-High.

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Lockup Period Expiration (LPX) Watch:
Content provided by Aly Angel: Follow on Twitter at https://twitter.com/tradingfitgirl

Most IPOs are subject to a 180 day lockup period 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.

LPX dates June 21st to June 24th

This week is slim, as 6 months ago, this would have been the Grinched week of X-Mas

There are several LPX tickers from May that are still on watch as they have given the indicators we watch for, before the runs

90-Day and 180-Day LPX

Locafy Limited (LCFY) wx LPFYW
Type: IPO – dual listed Australia
LPX Date: 23-Jun-22
LPX Period: 90-day under gen rule
IPO Date: 25-Mar-22
IPO Price: $4.125

Exercise Price: 125% list price equal to $5.16
Secondary Offering Exercise Price: n/a

Notes: 90-day LPX is under gen rule only, has 180-day LPX for 5.5m shares
– Reference 424B4 Filed 29-Mar-22

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NEXGEL, INC. (NXGL) wx NXGLW
Type: OTC Uplist
LPX Date: 20-Jun-22
LPX Period: 6-month
IPO Date: 22-Dec-21
IPO Price: $5.50

Exercise Price: 2.5m sh unit at 100% equal to $5.50 & UW 112.5% equal to $6.19
Secondary Offering Exercise Price: n/a

Notes: Uplist r/s ratio 1:35 (this is good) and has 60, 90, 120, 180 leak out

– Reference 424B4 Filed 23-Dec-21

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IPOs that hit 180-day LPX dates in the last 30 days, but have not run to EPs

Check date if there’s a secondary offering, as these take longer to run.

BEAT – EP $6 – IPO
BJDX – EP $7 – IPO
BLBX – EP $6.25 – Uplist
HTCR – EP $6.25 – IPO
STRN – EP $4.81 – $5.18 – IPO *has secondary
TIVC – EP $6.25 – IPO

For a full list of IPOs and Uplist LPX dates and video reviews
https://tradingfitgirl.net/always-learning for the direct Spreadsheet Link

After a couple weeks of relative optimism, including a string of recent low-float IPOs that ran hard on positive press releases, last Friday’s abominable CPI data sent the market into yet another tailspin that has slammed shut the door on any prospective mainstream IPOs for the near future, and even managed to put the breaks on a few low-float IPOs that were slated for this week.

While any IPO brave enough to debut in this market is going to raise suspicion for a possible Stealth debut, last week’s debacle of a debut with PEV demonstrates the importance of gauging the pre-debut imbalance for confirmation of a potential string of halts to the upside, and we were able to avoid catastrophe by recognizing the symptoms of a broken IPO in advance of the debut: high volume on the opening print, debut price below the IPO price, and a sell-side imbalance.

This week brings us two IPOs, one of which has not appeared on any IPO calendars and has me thinking we might see a potential stealth setup: the other from an underwriter whose brought us a ripping IPO that produced one of the more dramatic multi-day LPX runs we’ve seen in a while (yes, I’m talking about AERC). Be sure to read through this newsletter to the upcoming LPX section provided by https://twitter.com/tradingfitgirl following the IPO breakdowns for this week for more potential runners this week.

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This Week’s IPOs:

• Heart Test Laboratories (HSCS) – June 15, 2022 | 1.75M Units
  

• Lytus (LYT) – June 15, 2022 | 3.25M Shares

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Ok, Let’s jump in:

Heart Test Laboratories (HSCS) – June 15, 2022 | 1.75M Units
Price Range: $4.50 – $5.50
Offering Size: $9M
Shares Outstanding: 8.11M

Industry: Medical Devices

Overview: This company is developing a cardiac diagnostics test with enhanced ECG functionality that incorporates artificial intelligence to analyze data and produce analysis that currently requires more invasive testing procedures to replicate. They are raising capital to bring the product through the FDA approval process, and the units contain a single share and single warrant: both of which will be tradable immediately following the IPO.

Considerations: The underwriter on this deal is The Benchmark Group – the same outfit that brought AERC to market on the day before the Thanksgiving holiday: a memorable IPO that opened for trading at $40 after pricing the IPO at $10, and proceeded to rip over $100 through a series of halts. But this offering comes with a warrant attached, and that almost never produces the kind of ripping open that we hope to spot on these debuts. The company itself is pre-revenue, and the market is clearly still recovering from the knockout blow that was delivered with last week’s CPI data, so I’m not sure there will be much enthusiasm for any IPOs simply based on the company or product being offered.

Growth Numbers: (none: pre-revenue)

Baseline Financials: (none: pre-revenue)

Notes from the S-1:

Underwriters: The Benchmark Group

IPO Classification: Low Float IPO

Recent Similar IPOs: AERC BEAT

Trading Strategy: My approach to this one is to sit back and not touch it… UNLESS it debuts with a tiny volume and a healthy debut premium. And even then, I don’t think I can justify taking a high-risk position on it.However, I will certainly be watching this one down the road for a possible LPX play… low float, with warrants and a 501(k) FDA approval catalyst on the horizon could set up an AERC-style run.

Brand Name Recognition: Low.

Debut Trade Conviction Level: Low.

+++

Lytus Technologies (LYT) – June 15, 2022 | 3.25M Shares
Price Range: $4.75 – $6.75
Offering Size: $17M
Shares Outstanding: 37M

Industry: Streaming/Telemedicine

Overview: We covered this Indian Company’s proposed IPO back in mid-April when it was being underwritten by Aegis Capital, and were not too thrilled with the underlying facets of the company at that time: streaming content and telemedicine offerings with relatively small customer bases compared to major competitors in each respective space.
On April 21, 2022 I wrote:
”We haven’t seen all that many Indian IPOs in US markets: perhaps because India has it’s own robust stock market, so it’s interesting that this one is going live on the NASDAQ. The company claims roughly 8M active customers for its content streaming services (which in a country of 1.4B people, is basically nothing), and is planning to provide tele-health services in America through its Global Health Services Inc company. They are actively acquiring companies in the tele-health segment, but as those of us who have followed Doximity (DOCS) since it’s IPO, most physicians are already hooked into that platform. Their growth numbers are not really worth paying much attention to, as they had limited operations in 2019 and so 2020 comparisons once they started generating revenue were obviously impressive statistically, but cannot be considered to correlate to any future growth projections. Having said that, they did generate $12.3M in gross profits on $29M in revenue in 2020 with a gross margin of 42%.”

Considerations: What’s changed since the April 2022 F-1 filing is the underwriter, the size of the deal, the removal of attached warrants to the IPO shares, and the market conditions. I don’t think anyone can argue that market conditions have materially improved since April, and removing the warrant makes this a more interesting IPO as far as retail traders buying the debut goes, but why the shift in the underwriter? We saw PEV switch out Roth/Maxim/EF Hutton for Aegis, who dumped shares on WeBull traders and the resulting IPO was a thing of horror – so I’m wondering what made this deal doable for Spartan that was unattainable for Aegis. Rumors are that the newly assigned underwriter was able to bring in a buyer that is willing to soak up a substantial piece of the pie, and that allocations to brokerage desks were fairly limited. The company itself is not really what’s going to determine whether this debut provides any upside potential to take wins off the debut: but if the dynamics behind the opening trades get manipulated, we could be looking at a potential runner.

Financials:

Growth Numbers (unaudited):
– Revenue Growth: –24% for 2021 vs 2020
– Total Comprehensive Income: +1890% for 2021 vs 2020

They did, however, post positive operating profit in 2020, along with positive net income, despite negative cash flow from operations.

But let’s be honest here – we’re not analyzing this company for a long-term investment, and any volatility in this IPO debut is not going to be based on retail interest in the fundamental business of this company.

Notes from the F-1:
– “We intend to use the net proceeds received from this offering for the following: An aggregate of $9.05 million for the acquisition of customers (ownership of approximately 1.8 million customers) and 51% of the shares in a licensed cable company.”

Underwriters: Spartan Capital Securities

IPO Classification: Low Float IPO

Recent Similar IPOs: OST AUST

Trading Strategy: I’m very suspicious that.this one could be a ‘Stealth IPO’ – given how it snuck onto the calendar and rumors about ultra-low allocations on direct brokerages. As always, I’ll be watching the pre-debut indication for a premium to the IPO price in the $11-16 range, a strong buy-side imbalance, and low volume. If I see this setup, I’ll likely take a position on the debut, remembering not to go excessively large as this will push the price up on a low-volume debut and spoil the upside potential. If I don’t get the setup I’m looking for, I’ll just walk away from it.
Day 2 runs off poor Day 1 performances have not materialized on recent low-float busts, so that play is not something I’m trying to position myself in right now.

Brand Name Recognition: Low.

Debut Trade Conviction Level: Medium

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Lockup Period Expiration (LPX) Watch:

Most IPOs are subject to a 180 day lockup period 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.

LPX dates June 13th to June 17th

90-Day, 120-Day and 180-Day LPX:

Akanda Corp (AKAN)
Type: IPO
LPX Date: 13-Jun-22
LPX Period: 90 Day
IPO Date: 15-Mar-22
IPO Price: $4.00

Exercise Price: 125% list price equal to $5.00
Secondary Offering Exercise Price: n/a

Notes: 90 day LPX has 2m avail to use, also has 180 day
– Reference 424B4 Filed 16-Mar-22

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Fresh Grapes, LLC (VINE)
Type: IPO
LPX Date: 13-Jun-22
LPX Period: 6-month
IPO Date: 14-Dec-21
IPO Price: $10.00

Exercise Price: 125% list price equal to $5.00
Secondary Offering Exercise Price:

Notes: 180-day LPX has 10m sh avail to use

– Reference 424B4 Filed 14-Dec-21

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Genenta Science S.p.A. (GNTA)

Type: IPO

LPX Date: 09-Jun-22
LPX Period: 6 Month
IPO Date: 15-Dec-21

IPO Price: $11.50
Exercise Price: 125% list price equal ton $14.375

Notes: 180 day 2.4m sh avail to use

– Reference 424B1 Filed 15-Dec-21

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Bionomics Ltd (BNOX)

Type: OTC Uplist
LPX Date: 14-Jun-22
LPX Period: 6-month
IPO Date: 16-Dec-21
IPO Price: $12.35
Exercise Price: none listed

Secondary Offering: Uplist has open offerings while on OTC board

Notes: 180 day 1.6m sh avail to use

– Reference 424B4 Filed 17-Dec-21

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IPOs that hit 180-day LPX dates in the last 30 days, but have not run to EPs

Check date if there’s a secondary offering, as these take longer to run.

BEAT – EP $6
BJDX – EP $7
HTCR – EP $6.25
STRN – EP $4.81 – $5.18 *has secondary
TIVC – EP $6.25

For a full list of IPOs and Uplist LPX dates and video reviews https://tradingfitgirl.net/always-learning for the direct Spreadsheet Link

Another week with a light IPO calendar, with just a single IPO slated to debut: but with an ultra-low float, no warrants, and an underwriter that has given us some volatile stealth setups in the recent past, at least we have some excitement to look forward to.

On top of that, we’ve seen low-float stocks take the spotlight again this week, with recent low-float IPO AERC, with just over 4M shares in the float, embarking on a monster two day run that saw the stock rally from around $2.50 at the start of the week to a high of $15.25 by Tuesday’s after-hours session. JAN followed suit on Tuesday, with a jump from $2.50 at the close on Monday, to touch $5.00 on Tuesday’s headline; closing at $4.07 with high hopes that it will reproduce AERC’s type of Day 2 fireworks.

So with low-float in focus, keep an eye out for PR drops on any recent low-float IPOs this week: it won’t take much of a catalyst to send them running, and if we see JAN’s momentum carry over into Day 2, then significant headlines can be traded across multiple days.
With that in mind, I’m extra-excited about this week’s low-float IPO debut.

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SHOUT OUTS:

• Lockup Expiration Section: We are welcoming Aly Angel to the IPO Warriors newsletter starting this week. Many of you know her as @tradingfitgirl on Twitter: for those who don’t, she is a highly analytical swing trader with a focused strategy around trading recent IPOs around their lockup expiration (“LPX”). Her strategy is relatively low-risk with high upside potential, and worth understanding if not directly playing them. She has produced in-depth guides that can be purchased on her website here.
  

• Support Dog Rescue Efforts in Ukraine: Simply by streaming the songs on TheSound.com’s Spotify account, you can generate revenue for projects that help dog rescue efforts. Our current support is going towards PawsofWar.org

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This Week’s IPOs:

• Phoenix Motors (PEV) – June 8, 2022 | 2.5M Shares
  

  —> LIVE STREAMING PEV on June 8, 2022 at 9:40 AM EST here:
  
  https://www.youtube.com/watch?v=wGxKEIZhZfk
  
  Subscribe to the IPO Warriors YouTube Channel and set your reminder to join me and Aly Angel for a live stream trading session for Phoenix Motors (PEV) – should be volatile, if nothing else!

+++

Ok, Let’s jump in:

Phoenix Motors (PEV) – June 8, 2022 | 2.5M Shares
Price Range: $7.00 – $9.00
Offering Size: $21M
Shares Outstanding: 20M

Industry: Electric Vehicles

Overview: This company produces integrates electric drive systems into light and medium duty trucks: namely the Ford F450, and sells EV chargers to the residential market, along with leasing services. The company is profoundly not profitable have sold only 104 EVs in the history of the company, with financials that are about as bad as you could imagine: it really looks like the kind of company that missed out on the EV craze of 2020 and sounds so shady that it would have fit right in with taking the SPAC route alongside NKLA. This IPO was originally filed in November 2021, and is technically a spin-off from SPI Energy Co – with Roth Capital, Maxim, and EF Hutton lined up as the underwriters, and the S-1 was refiled in February 2022 at 4M units that included a share and a warrant.
Recently, Prime Number Capital took over as the sole underwriter, and removed the warrant while reducing the float to just 2.5M shares.

Considerations: This is one of those IPOs that is just so bad on the surface that I can’t help but be intrigued. The company is losing money at an accelerating pace, and EV stocks have taken a hit along with most growth/non-profitable stocks over the past three months. Dumping Roth/Maxim/EF Hutton as underwriters for Prime Number Capital certainly sets off the alert for a potential Stealth IPO play: for those of you who remember, MHUA and OST both were represented by Prime Number, and offered volatile debuts with significant win potential off debut buy-ins.
One point to consider is that PEV has been available on WeBull for pre-order allocation for about a week: so was OST, and allocations were generous, but not fully filled… so I’ll be keeping an eye on how much of my allocation request gets filled to gauge what kind of effect a large retail position might have on the opening move once this one starts trading.
I doubt the fact that this is an EV company is going to have much of an impact on the demand for this IPO – but the fact that the float is just 2.5M shares is likely to be enough to draw attention to this debut. Given the focus on low-float trades this week, the timing in this regard is perfect: so if the underwriter/insiders pulls their usual shenanigans, and restricts the volume on the opening debut – then we should see some highly volatile moves in the opening minutes: halts almost certain, though which direction they move will be determined by the initial opening price and how many retail traders dump their shares early.
Another hint that we may be looking at a Stealth IPO setup, is the heavy presence of Chinese executives in both Phoenix Motors and the parent company that is spinning off this IPO… (most Stealth IPO setups involve direct or indirect ties to China).

Growth Numbers:
– Revenue Growth: -55% for 9 months ending September 31, 2021
– Gross Profits: -56% for 9 months ending September 31, 2021
– Gross Margin: -9% for 9 months ending September 31, 2021
Baseline Financials:
– Cash Flow: negative – expanding (getting worse)
– Net Income: negative – expanding
– Operating Profit: negative – expanding

Notes from the S-1:
– 180 days after the date of this prospectus due to contractual obligations and lock-up agreements between the holders of these shares and the underwriters. However, the underwriters can waive the provisions of these lock-up agreements and allow these stockholders to sell their shares at any time, provided their respective one-year holding periods under Rule 144 have expired.
So like, get ready for the float to balloon whenever the underwriter feels like it’s reached a high enough point to dump stock.

Underwriters: Prime Number Capital

IPO Classification: Low Float (potential Stealth setup)

Recent Similar IPOs: OST MHUA

Trading Strategy: IF this turns out to be a Stealth IPO setup, then we’re almost certainly going to see a strong debut premium: with an initial opening trade likely to be priced anywhere from $13 to $45. If we see the lower end of this spectrum with a buy-side imbalance, then I’ll be inclined to add to whatever allocation I receive and trade this aggressively across all my accounts.
If this indicates below the IPO price – which is expected to come in at $7 – then perhaps I completely misread this one, and it would then be up to day traders to pump this one purely based on speculation and low-float: which might be good for a halt at some point, but will be a

Brand Name Recognition: Low.

Debut Trade Conviction Level: High.

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Lockup Period Expiration (LPX) Watch:

Most IPOs are subject to a 180 day lockup period 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.

LPX dates June 6th to June 17th

90-Day, 120-Day and 180-Day LPX

Marygold Companies (MGLD)
Type: OTC Uplist
LPX Date: 08-Jun-22
LPX Period: 90 Day
IPO Date: 10-Mar-22
IPO Price: $2.00

Exercise Price of Common Shares: 120% list price equal to $2.40
Secondary Offering Exercise Price:

Notes: ticker ran to EP in pre-market on June 3rd. Also states a 180-day LPX for Dir & Ofc
– Reference 424B4 Filed 11-Mar-22

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Akanda Corp (AKAN)
Type: IPO

LPX Date: 13-Jun-22
LPX Period: 90 Day
IPO Date: 15-Mar-22
IPO Price: $4.00

Exercise Price of Common Shares: 125% list price equal to $5.00
Secondary Offering Exercise Price:

Notes: ticker has 2m sh out of LPX at 90 days and has a leak-out for remaining
– Reference 424B4 Filed 16-Mar-22

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The Arena Group (AREN)
Type: OTC Uplist

LPX Date: 09-Jun-22
LPX Period: 4 Month
IPO Date: 09-Feb-22
IPO Price: $8.25
Exercise Price of Common Shares: $10.00

Notes: 90- and 120-day LPX dates

– Reference 424B4 Filed 14-Feb-22

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Creative Medical Technology (CELZ)
Type: OTC Uplist

LPX Date: 06-Jun-22
LPX Period: 6 Month
IPO Date: 06-Dec-21
IPO Price: $4.13
Exercise Price of Common Shares: 110% of IPO equal to $5.1875
Secondary Offering Exercise Price: S-3 effect 19-May-2022 15m sh @ $2.25 EP $2

Notes: ticker hit EP at day 112, has secondary

– Reference 10Q Filed 13-May-22, 424B3 Filed 20-May-22

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Cingulate Inc. (CING)
Type: IPO

LPX Date: 06-Jun-22
LPX Period: 6 Month
IPO Date: 08-Dec-21
IPO Price: $6
Exercise Price of Common Shares and warrants: $6 & $7.50

Notes: 424B4 20-Apr-22 selling sh for warrant exercise at $6

– Reference 10Q 12-May-22, 424B4 20-Apr-22

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NeuroSense Therapeutics Ltd. (NRSN)
Type: IPO

LPX Date: 07-Jun-22
LPX Period: 6 Month
IPO Date: 09-Dec-21
IPO Price: $6 sold as units
Exercise Price of Common Shares and warrants: $6 equal 100% of the IPO price per Unit

Notes: ticker hit EP’s at day 102
– Reference 20F 14-Apr-22

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IPOs that hit 180-day LPX dates in the last 30 days, but have not run to EPs

Check date if there’s a secondary offering, as these take longer to run.

AERC, 23-May-22, currently walking up
STRN – EP $4.81 – $5.18 *has secondary
BJDX – EP $7 & $10
BEAT – EP $6
TIVC – EP $6.25

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For a full list of IPOs and Uplist LPX dates and video reviews https://tradingfitgirl.net/always-learning for the direct Spreadsheet Link