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The  IPO Prophet's Perspective

Written by Scott Shelton | Feb 4, 2025 8:20:52 PM

It’s great to see some real action again! IPO activity is picking up, and last week our signals were firing on all cylinders. The goal of our signaling process is twofold: first, to give an informed edge on which deals have the best chance of performing well right out of the gate, and second, to identify setups where downside risk is elevated. When an IPO fails to trigger a Bull Signal and later generates a Bear Signal, that’s confirmation in real-time that the absence of strength was no coincidence.

Of course, we’d love to see every IPO deliver strong early returns—but that’s just not reality. Instead, last week reinforced why the IPO Prophet framework works. Beta Bionics (BBNX), the standout performer, received a Bull Signal—and it delivered. Meanwhile, those that failed to trigger a buy signal were the clear underperformers post-open.

For months, we’ve reiterated that 2025 will bring a more active IPO calendar, and this past week was just a preview of what’s ahead. The signals are back, and the action is heating up—we expect more of both in the weeks to come.

The chart below presents a time-normalized view of five IPOs that debuted this past week, with IPO Prophet signals overlayed to track performance. Among these, Beta Bionics (BBNX) and Infinity Natural Resources (INR) were flagged with “Bull Signals,” while SFD demonstrated weakness post-open, ultimately triggering a “Bear Signal.”

 

BBNX: A Strong Signal Amidst Volatility

BBNX demonstrated the effectiveness of our signaling process, delivering a one-day gain of +6.91% when following the prescribed entry and exit methodology. The stock opened at $22.00, and despite some intraday fluctuations, it closed higher at $23.81, reinforcing the bullish momentum captured by our model. Traders who followed the signal were rewarded with a meaningful outperformance relative to broader IPO flows this week.

INR: A Quick Reversal, Caught in a Trap

Conversely, INR presented a more challenging trade. Initially flagged as a “Bull Signal,” the position was stopped out at a blended price of $21.98, compared to an opening trade of $22.16. The stock failed to sustain upward momentum and continued its decline, finishing 4.92% lower on the day. This illustrates the importance of disciplined risk management, as exiting at the stop price avoided additional downside exposure.

SFD: A Classic Bear Signal in Action

Unlike BBNX and INR, SFD struggled immediately after opening, failing to gain traction and steadily declining throughout the trading session. Multiple sell signals (denoted by red markers in the chart) confirmed that the stock lacked demand, with its trajectory reinforcing the weakness in non-signal IPOs this week. While individual performance varied, the broader theme remains consistent: IPOs failing to attract strong initial interest tend to continue underperforming.

Takeaways: The Market’s Selective Appetite

This week’s IPO activity highlights the ongoing bifurcation in new issuance performance. Select names, like BBNX, found strong support, but overall conditions remain choppy, emphasizing the necessity of signal-driven execution. IPO Prophet’s approach—filtering for high-conviction setups while maintaining strict risk protocols—continues to prove invaluable in this environment.

IPO Prophet’s value lies in our proprietary signaling process. We analyze Initial Public Offerings using a suite of algorithms refined over the past 20 years. The table above highlights all IPOs in 2024 where IPO Prophet has generated a Bull Signal, demonstrating returns based on our signals and subsequent performance since the opening trade. While our indicators can be applied to longer-term positions, the data above reflects only the first day’s performance, as our signals are designed specifically for issuance day, with positions marked to market at the close of the IPO’s first trading day. To learn more about our process, here.