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IPO Trading Review for the Week of January 3, 2022 – January 7, 2022

January 2nd, 2022

The 2022 IPO calendar finally came alive with 4 IPO debut on Friday, January 7th, 2022, and we were treated to one run-away flier and 3 typical biotech busts…

Before we jump in, I wanted to thank everyone who contributed to the IOPWarriors Streaming Equipment Fundly Campaign. The gear finally arrived this weekend, and I’ve posted the setup for the upgraded “IPO Warrior Battle Station” here.

I did get hit with a somewhat unexpected 30% tariff/tax on the import fees, so if you’d like to send support in appreciation of the hard work that goes into this research, it’s not to late to contribute and very much appreciated:

Ok, let’s take a look at last week’s IPO debuts:

Hour Loop (HOUR) was the clear winner (only winner) of the week: with a microscopic float of just 1.5M shares and financials that were oddly impressive, this one had my full attention, and delivered far more explosiveness than I expected. I’m still easing myself back into these trades, so took a smaller position on the debut than normal, and made up my mind to take profits conservatively (Rule #1: take profits with no regret)…
The retail allocations for HOUR were rather generously granted at 25 shares for WeBull/ClickIPO requests, which likely contributed to the muted debut price, as this stock opened trading at just $4.50 after pricing the IPO at $4.00. An initial move up into a halt at $4.95 was followed up by a down-up move out of the halt as many IPO buyers likely flipped their positions, resulting in a bit of an oddity in a second halt at just $5.06. The stock began moving up from there, hitting a 3rd halt at $5.87, opening into what proved to be a bullish pennant formation in the $6-7 range, then pulling a quick dip-and-dash move into a momentous run up up as high as $9.20 before a slight pullback followed by a steady climb throughout the remainder of the day to a peak of $10.30 before trailing out for the final hour of trading to close at $7.99. If you timed this one perfectly from the debut to the peak, you stood to claim nearly 130% gain, and the share price never dipped below the opening trade, so if you played this at all, you took a profit. Nice job: your IPO trading year should be off to a great start (provided you didn’t try your hand at any of the biotech IPOs…

Vigil Neuroscience (VIGL) debuted at $12.00 – below the IPO price of $14, and proceeded to jump out of a window to a bottom of $10.85 before rebounding quickly to a daily high of $12.87. While possible to catch that rebound play, it’s a tricky one to spot, although on a debut-below-IPO price, followed by a hard drop, it seems like you’d be getting a decent value: I dunno, you’re still talking about taking maybe a 10-20% on a play that could go either way, and would almost certainly leave you in a stuck position if it didn’t rally. Biotechs rarely go on Day 2 momentum runs, and usually fade out on low-volume for weeks before finding a baseline; at least until the quiet period ends, and this one doesn’t sound like it has any immediate catalysts lined up.

Amylyx (AMLX) indicated at a hefty $24.00 compared to its IPO price at $19.00 before settling down to debut at $21.00… it then dropped hard to a bottom of $17.98 before a bounce failed to re-claim VWAP initially, but finally climbed back up to $20.00 about 2 hours later.. but that was all the steam it could muster, as it fell off as low as $17.56 early in Power Hour, rising slightly to close the session at $18.07. This one does seem to be a likely candidate to pull some moves once the quiet period ends, as it has ongoing phase III studies and has already applied to the FDA for marketing clearance. I believe the response is expected around June 2022, so no rush to accumulate a position, but if we’re significantly down below the IPO price in May, I might consider taking a chance on a position heading into those expected catalysts.

Cincor Pharmaceuticals (CINC) gave us the epitome of Biotech Busts, with a debut premium at $21.00: well above the $16 IPO price, followed by a free-fall to a baseline at around $15.85 that more or less flat-lined between a daily low of $15.16 and top range capped at $16.75. Not a lot of volatility to trade here, and would have been a pretty slow and unrewarding effort to try and catch the bottom and top of this one. Perhaps the opportunities for biotech IPOs is to try and catch a bounce or run off the bottom, but you’re usually talking about a 5-10% move that can take all day to play out, and picking which one and at what entry point can easily result in bag holding a stock that may not have catalysts for years. I’m gonna stick to my no-biotech debuts rule for now, but have started tracing these on a longer timeline for “QP Sleepers” that might run off headlines after the quiet period expires (usually 30 days after the IPO).


This upcoming week brings us the first mainstream IPOs of the year, with Justworks (JW) and TPG Partners (TGP) testing the waters for what should be an informative litmus test for the current market’s IPO conditions. Catch me Monday at 12:00 PM Noon on Benzinga to break down these and a couple other potentially interesting IPOs. I’ll post the links tomorrow on Twitter…

NOTE: this is not financial advice, and I am not a financial advisor: this information is just my opinion and is for informational purposes only. I may have or take positions in the equities mentioned in this article in the next 72 hours. Trading equities is risky. Do your own research,and trade your own trade.

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