The GoHealth IPO reversed lower after a hot start in its first day of trading after the online health insurance portal raised $914 million late Tuesday, exceeding expectations.
GoHealth (GOCO) closed down 7.3% at 19.46 after initially jumping 23% in its Nasdaq trading debut Wednesday under the ticker GOCO.
The Chicago-based company priced shares at $21, above its estimated range of $18-$20. GoHealth had been looking to raise $751 million, with a valuation of $6 billion.
The GoHealth IPO offered 43.5 million shares, which was 4 million more than the provider of a Medicare-focused insurance marketplace initially planned.
GoHealth shifted focus toward Medicare products and away from individual and family plans over the last four years, citing an aging population.
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GoHealth IPO Among Year’s Biggest
The $914 million in proceeds generated from the GoHealth IPO ranks among the highest of the year. Royalty Pharma (RPRX) raised $2.175 billion and Warner Music Group (WMG) raised $1.925 billion, Dun & Bradstreet (DNB) raised $1.723 billion, and Zoom Infotechnologies (ZI) raised $935 million. Those IPO stocks all came public last month.
Founded in 2001, GoHealth touts significant growth in the Medicare space. Net revenue grew 104% to $141 million in the first quarter and by 138.5% to $539.5 million in fiscal 2019.
Last year, the health insurer generated more than 42.2 million consumer interactions and 4 million consumer leads, according to IPO expert Renaissance Capital.
The lead underwriters are BofA Securities, Morgan Stanley and Goldman Sachs.
Find Aparna Narayanan on Twitter at @IBD_ANarayanan.
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