Is eToro Igniting a Spark in the IPO Market and Potentially These 2 Holdings?

We are seeing signs of a potential renewal in the IPO market, one that could benefit shares of two Pro Portfolio positions should the potential spark catch fire. More than the rebound in the market, this sign we are watching is the surge we are seeing in the shares of eToro (ETOR) after pricing its 6 million share IPO at $52 per share earlier Wednesday, above the targeted $46-$50 range.

For those who are not familiar with eToro, it is an Israel-based stock and cryptocurrency trading platform, similar in some respects to Robinhood HOOD. Up next, we will want to watch the pending IPO of digital health company Hinge Health (HNGE), which launched its deal roadshow Tuesday and targets issuing 13.7 million shares between $28-$32. Based on how Hinge’s offering prices and performs, we could see the IPO of another digital health company, Omada Health (OMDA), come to market.

Should we see the spark we see with eToro’s offering spread to Hinge, the odds that other filed IPOs will jockey to come to market will improve. What's more, if we see more uncertainty come out of the market, likely in the form of more trade deals and further progress on Trump’s tax efforts, that would also help improve the odds for more filed IPOs to come to market. That includes higher-profile ones, including Klarna and StubHub, that were recently paused, as well as more recent ones like fintech app Chime Financial.

All of this is a positive for Pro Portfolio holdings Morgan Stanley MS and Bank of America BAC. Indeed, because Morgan Stanley is listed as a book runner for the Klarna, Chime, and Hinge Health offerings, we’ll be tracking those rather closely. 

At the time of publication, TheStreet Pro Portfolio was long MS and BAC.