If you missed SNAP & MULE’s IPO, then you’ll want to read this!
NEW IPO THAT HAS THE POTENTIAL TO CRUSH SNAP & MULE’S IPO!
There is an IPO happening this morning (11 EST) that our readers should be well aware of that CNBC will NOT be covering since it’s not a multi-billion dollar raise like SNAP and MULE was. However, it’s most likely going to be a very successful one for early investors/traders for several reasons…
The company is called Therapix Biosciences (TRPX) and we believe it’s going to be a big IPO percentage gainer because they will list with just an $18M market cap compared to their three peers, which currently trade for market caps of $3B, $715M and $240M respectively. Based on those numbers, they will be the cheapest stock in their space.
On top of that, they are in one of the hottest spaces in the stock market that is seeing tremendous growth… the cannabis space… more specifically, the pharmaceutical cannabinoid space.
Cannabinoids are the types of molecules found in the cannabis plant that have shown great potential to help cure neuropathological degenerative diseases like Tourettes Syndrome, Alzheimers and other forms of age-related dementia.
The national costs for treatment and management of these types of diseases is expected to quadruple from $250 billion per year, to over a $1 trillion by the year 2030. As a result of this, there is a lot of money going into this type of cannabinoid research.
After decades of strict prohibition, cannabis is finally enjoying legal, mainstream applications in the pharmaceutical industry and if you have been following this space at all, you will know that it is exploding.
There are a ton of marijuana stocks trading on the OTCBB, but a lot of these companies are questionable to say the least, yet they fetch very lofty valuations in excess of $250M.
When it comes to legitimate pharmaceutical based cannabinoid listed companies on the Nasdaq, you’ll find yourself coming up short. Most of them are private companies.
As it stands today, there are ONLY THREE pharmaceutical cannabinoid Nasdaq listed companies that investors can buy and as we said earlier, they are ALL trading with market caps north of $240M.
The first one is GW Pharmaceuticals (GWPH), currently trading at a $3B market cap. The other is Insys Therapeutics (INSY), trading at a $715M market cap and the last one is Zynerba Pharmaceuticals (ZYNE), trading at a $240M market cap.
If you only invest in senior listed companies and you are looking to gain exposure to the cannabinoid space, then you’ll have to look at those three companies or wait until 11 EST today for the Therapix Biosciences’ (TRPX) IPO.
Therapix Biosciences develops drugs based on cannabinoid molecules for the treatment of Tourette’s and early stage Alzhiemers.
Therapix will be the fourth cannabinoid focused biopharmaceutical firm ever to list on the Nasdaq.
In December of 2016, they began their Phase II clinical trial with results expected mid-year.
As we said in the beginning of this article, we believe this IPO is going to be a huge homerun because their market cap post-IPO will only be $18M since they are only selling 2M shares (3M total outstanding) at $6!
From what we hear, the offering was way oversubscribed and a lot of investors were left out of the IPO.
When it comes to structure of an IPO, it’s very rare that you see so few shares being floated to the public.
If you’re an active trader, then you will agree that these low-float types of stocks have been on fire these past 4 months and we believe that Therapix will be no different… especially when you compare their market cap to the other three cannabinoid companies listed on the Nasdaq.
Not to mention, once the street catches on that this cannabinoid company that is currently in a clinical trial with results expected mid-year is now a public company and is only carrying a tiny $18M market cap with 2M shares in the float… we believe this is a recipe for a massive run in the stock that will make the gains of SNAP and MULE look like child’s play!
March IPO Review:
SNAP priced its IPO at $17 on March 2, 2017, but it opened up at $24 per share and traded as high as $29.44 the following day for a potential gain of 73% for their IPO investors.
Since then, it has been falling like a knife and is currently trading around $20.75 as of this writing, which is still a 22%+ gain from their IPO price.
This past Friday, MULE, another Silicon Valley unicorn, priced its IPO and it’s almost an exact photocopy of SNAP’s IPO.
They priced at $17 per share and just like SNAP did, opened up for trading at $24.25 and hit an intraday high of $25.92, but closed their first day of trading at $24.75 for a 45%+ potential gain for their IPO investors.
The question is… will MULE’s stock fair better than SNAP’s has or will it begin a precipitous decline back to its offering price?