Omada shares open at $23 in Nasdaq debut after firm’s IPO

Omada Health shares rose 21% in their Nasdaq debut Friday after the virtual chronic care company priced its stock at $19 per share in its IPO.

The stock opened at $23 and closed at that same level, reaching a high of $28.40 in the middle of the day.

The company said in a press release late Thursday that it sold 7.9 million shares in the offering, amounting to about $150 million. The pricing was in the middle of the expected range, and valued the company at just over $1 billion, though that number could be higher on a fully diluted basis.

Omada, founded in 2012, is trading under ticker symbol “OMDA.” The company offers virtual care programs to support patients with chronic conditions like prediabetes, diabetes and hypertension. Sean Duffy, Omada’s CEO, co-founded the company with Andrew DiMichele and Adrian James, who have both moved on to other ventures.

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It’s the second digital health initial public offering in a matter of weeks following an extended drought for the industry. Digital physical therapy startup Hinge Health debuted on the New York Stock Exchange in May. Hinge is currently trading at $38.50 after selling shares in its IPO at $32.

The tech IPO market has been showing signs of life, with Hinge being one of the latest offerings. On Thursday, shares of crypto company Circle Internet soared 168% in their NYSE debut. Fintech company eToro started trading last month, and Chime Financial, which offers online banking services, is set to hit the market next week.

“It’s a surreal moment, of course, because you just get to see all these people who’ve given so much to the business,” Duffy said in an interview with CNBC. “I just feel really proud.”

Earlier in the day, Duffy told CNBC’s “Squawk Box” that, “We like the scale of the model, we like the scale of the business, equally we felt pull from the capital markets.”

Omada’s revenue increased 57% in its first quarter to $55 million from $35.1 million a year earlier, according to its prospectus. For 2024, revenue rose 38% to $169.8 million from $122.8 million the previous year. The company’s net loss narrowed to $9.4 million in the first quarter from $19 million a year ago.

U.S. Venture Partners, Andreessen Horowitz and Fidelity’s FMR LLC are the largest outside shareholders in the company, each owning between 9% and 10% of the stock.

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