What was interesting was that the underwriters gave an overall positive view but the price targets did not create an extra boost. J.P. Morgan, BofA Merrill Lynch and Goldman Sachs were the joint book-running managers; and William Blair and Cantor Fitzgerald were co-managers for the Glaukos offering.
The post-IPO analyst ratings from the underwriters for Glaukos were shown to be as follows:
- Merrill Lynch was at Buy with a $37 price objective;
- Cantor Fitzgerald was a Buy with a $35 price target;
- Goldman Sachs was a Neutral but with only a $29 price target;
- JPMorgan was at Overweight with a $38 price target;
- and William Blair was at Outperform.
Bank of America Merrill Lynch’s upside call was based upon having the first truly commercial minimally invasive device to treat glaucoma. Its $37 price objective actually assigns no value to iDose and the firm thinks that could materially increase the total addressable market for the company. The many positives were also shown to include data, reimbursement, dollars for the doctor, a pipeline, a large potential market, and solid management.
What appears to be happening is that the investors have already had to pay up 50% or so from the formal IPO price. So paying up that much for another $3 or $4 in upside just might not be worth the implied risk-reward as of now, at least not to many investors. Also, that Goldman Sachs neutral rating did not help as that firm is one of the most closely watched for analyst ratings.
Glaukos shares closed at $31.95 on Friday, and the stock was down 2.7% at $31.10 minutes before the close.
What was equally as unimpressive as the reaction was that only 207,000 shares had traded hands with about 20 minutes to the close. Glaukos’ post-IPO high of $32.72 was also seen on Friday and the stock had traded more than 1 million shares on each last Friday and Thursday after very thin trading volume in the prior days.
Top Gaining Stocks
Top Losing Stocks