# New IPO Dentalcorp (DNTL)



## one day at a time (Aug 4, 2019)

Hi guys, I'm curious if anyone has any experience with buying ipo's. I'm currently an employee for a dentalcorp practice and they gave us the options to buy in before the shares hit the market, which will be this coming Monday (May 17 '21). Is this a good strategy? I'm not aware of too many specifics of the company, other than that it's the biggest corporate dental business in Canada, and it owns about 500 clinics across Canada. It's bigger than the next 2 corporate businesses combined and adds about 40 new clinics every year. There's a total of 15,000 dental clinics in Canada by the way. Do you guys have any tips or recommendations? I've never done one of these before and any help would be appreciated!


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## one day at a time (Aug 4, 2019)

I want to add that I think I read somewhere that their yearly income is about 600 million per year...I don't really know what that means though, like how much they have net at the end of paying for everything and salaries etc...


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## one day at a time (Aug 4, 2019)

dentalcorp Posts 105% Three-Year Revenue Growth in the Globe and Mail Top Growing Companies Ranking - Oral Health Group


dentalcorp achieves second spot among companies with more than $500 million in revenue dentalcorp, Canada’s leading network of dental practices, is pleased to announce it ... more




www.oralhealthgroup.com


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## Fain (Oct 11, 2009)

one day at a time said:


> Hi guys, I'm curious if anyone has any experience with buying ipo's. I'm currently an employee for a dentalcorp practice and they gave us the options to buy in before the shares hit the market, which will be this coming Monday (May 17 '21). Is this a good strategy? I'm not aware of too many specifics of the company, other than that it's the biggest corporate dental business in Canada, and it owns about 500 clinics across Canada. It's bigger than the next 2 corporate businesses combined and adds about 40 new clinics every year. There's a total of 15,000 dental clinics in Canada by the way. Do you guys have any tips or recommendations? I've never done one of these before and any help would be appreciated!


I buy a lot of share pre-ipo through private placement. Usually its a good idea but depends on specifics of course. You going to dump your shares at open on IPO day? do they give you warrants along with the shares?


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## one day at a time (Aug 4, 2019)

Fain said:


> I buy a lot of share pre-ipo through private placement. Usually its a good idea but depends on specifics of course. You going to dump your shares at open on IPO day? do they give you warrants along with the shares?


I was thinking of keeping them for 2-3 months, probably even up until the end of the year. I guess it depends on what direction they're going, but I understand IPO's move pretty fast initially? There are no warrants that I'm aware of, just regular share prices before opening day next week. I think it's going to be mid-week actually not Monday. I have a copy of the prospectus, if anybody wants to critique it....lots of numbers I don't fully understand...I would appreciate any feedback!



https://mcusercontent.com/f3f90e07cb5d095318c5be79a/files/e8cce12f-853c-4827-a272-da331a2dadbe/dentalcorp_Holdings_Ltd._Preliminary_Prospectus_English_.pdf


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## Fain (Oct 11, 2009)

one day at a time said:


> I was thinking of keeping them for 2-3 months, probably even up until the end of the year. I guess it depends on what direction they're going, but I understand IPO's move pretty fast initially? There are no warrants that I'm aware of, just regular share prices before opening day next week. I think it's going to be mid-week actually not Monday. I have a copy of the prospectus, if anybody wants to critique it....lots of numbers I don't fully understand...I would appreciate any feedback!
> 
> 
> 
> https://mcusercontent.com/f3f90e07cb5d095318c5be79a/files/e8cce12f-853c-4827-a272-da331a2dadbe/dentalcorp_Holdings_Ltd._Preliminary_Prospectus_English_.pdf


Yeah IPOs move fast. I usual gauge the interest. This would is priced between offering price between $16.00 and $19.00 per share. My guess is if it's priced in the higher range and oversubscribed that you will see a big jump in share price.


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## james4beach (Nov 15, 2012)

I think it has a lot do with the general market mood (amount of greed and risk-taking enthusiasm).

You can look at the IPO ETF to get a sense of how that market is behaving. Late 2020 became a super hot time for IPOs, largely described as an IPO bubble, but things have changed now (as you can see in the chart for IPO), weakening ever since February.

During an IPO mania or bubble, it doesn't matter what the company does because stupid investors will come along and pay any price for any company.

Today, IPOs are *not* getting a hot reception. If you're going to play this game, you only should do this when IPOs are hot.

For example, 2018-2020 was mostly no good for IPOs. Not enough stupid retail investors buying them up after they got listed.


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## Tostig (Nov 18, 2020)

My recent conflict between what my dentist wants to do and what my insurance company won't cover reminds me why it's probably a good idea to invest in who pisses you off.

Does anybody who invests in Long Term Care facilities actually live or send their parents there?


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## one day at a time (Aug 4, 2019)

Tostig said:


> My recent conflict between what my dentist wants to do and what my insurance company won't cover reminds me why it's probably a good idea to invest in who pisses you off.
> 
> Does anybody who invests in Long Term Care facilities actually live or send their parents there?


I assume you're talking about the insurance company upsetting you? Dentalcorp is not an insurance company, but rather a group of about 425 dental clinics owned by a corporation. If it was the dentist you were referring to, then it's probably time to get a new dentist!


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## one day at a time (Aug 4, 2019)

james4beach said:


> I think it has a lot do with the general market mood (amount of greed and risk-taking enthusiasm).
> 
> You can look at the IPO ETF to get a sense of how that market is behaving. Late 2020 became a super hot time for IPOs, largely described as an IPO bubble, but things have changed now (as you can see in the chart for IPO), weakening ever since February.
> 
> ...


 Interesting - I never knew such an index existed, but it's nice to know. Thanks for this! I send them an email that I'm interested in investing, so I guess we'll see how it all plays out. I think in the long-run, they'll be on solid footing, since they're adding hundreds of employees every year through acquisitions, and because of this IPOs, they will now have approximately 900million extra from what I read. That's a whole lot of cash injected into their acquisition and expansion plans, and it will allow them to become the dominant corporation in Canada (the 2nd biggest competitor has about 250 clinics). I guess we'll see how it all plays out!


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## Tostig (Nov 18, 2020)

one day at a time said:


> I assume you're talking about the insurance company upsetting you? Dentalcorp is not an insurance company, but rather a group of about 425 dental clinics owned by a corporation. If it was the dentist you were referring to, then it's probably time to get a new dentist!


I would be concerned that my dentist would now have to report to a board of directors how to cut cost, maximize profits and improve shareholder equity at the expense of patient care.

Does DNTL provide a complete list of dentists to ensure mine is NOT under its control?


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## OptsyEagle (Nov 29, 2009)

I will have to keep an eye on this one. In my younger days I thought about starting a consolidation business for the dental industry. What I noticed is that many dentists build up a very profitable business and would love to sell it to a new younger dentist, at retirement, but find it hard to get the pricing they think the business is worth from a younger newer dentist. A company with big pockets (access to the public stock market) could come along and buy them up and bring the two entities together for a very profitable relationship. They would need some strong non-compete contracts with their dental and hygienist professionals, of course.

Also, from what I see there is little price competition in the dental market. This is due the the very large group of people who have access to group insurance and really only look at their co-pay costs when determining if a procedure should be completed or not. That said, there is a huge market of people who have really no dental services at all. That is the uninsured market. It is very huge. I think a large company could take new dentists, just coming out of school, give them access to this very large market and of course undercut all the other dentists who are attached to the more lucrative insured market. It is a market just sitting there for the taking.

Too bad I was too lazy to put it all together. I knew someone would some day and I don't have any dental experience. I figured that was the least of the skills required to make this idea work.


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## one day at a time (Aug 4, 2019)

Tostig said:


> I would be concerned that my dentist would now have to report to a board of directors how to cut cost, maximize profits and improve shareholder equity at the expense of patient care.
> 
> Does DNTL provide a complete list of dentists to ensure mine is NOT under its control?


Working in this industry for the last 10 years, I can tell you honestly that whether or not a dentist reports to a board of directors, they have exactly the same way of thinking. All dentists think about how to cut costs, maximize profits, and improve personal equity, but not all do that at the expense of patient care. The ones that do will do it whether they report to a board of directors or not. Dentistry is a private business after all, and if you were in their place, you would do the exact same thing. The money hungry dentists are always money hungry, the ethical ones I've found to stay true to their ethics. I've worked with some dentists for over 7 years and in that entire time, I've never felt that they ONCE tried to get a little bit more work than what was needed. And after observing over 12000 dental exams, believe me, I know what the middle ground is. In the end, you just have to go with a dentist you trust, whether they work for a corporation or not.


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## one day at a time (Aug 4, 2019)

OptsyEagle said:


> What I noticed is that many dentists build up a very profitable business and would love to sell it to a new younger dentist, at retirement, but find it hard to get the pricing they think the business is worth from a younger newer dentist. A company with big pockets (access to the public stock market) could come along and buy them up and bring the two entities together for a very profitable relationship.


I agree. I've heard of dentists that say there was no way they would sell their practice to a corporation, but when they saw what they were offering them, they have no problem signing the contract. And it's not like you will have a long line-up of dentists outside your door trying to buy your clinic. The corporations will generally pay more than an average dentist for a clinic, as they're trying to get market share, and they NEVER sell their clinics. So once they have it under contract, consider that ground taken forever. And there is only so much saturation of dentists a particular city can support, so if a corporation buys a great majority of them, they essentially will have a monopoly. (not that I like monopolies, but from an investment point of view, it could provide a great opportunity)


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## Gator13 (Jan 5, 2020)

Has any picked up shares in DNTL?


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## Numbersman61 (Jan 26, 2015)

Fain said:


> Yeah IPOs move fast. I usual gauge the interest. This would is priced between offering price between $16.00 and $19.00 per share. My guess is if it's priced in the higher range and oversubscribed that you will see a big jump in share price.


In actual fact, the stock issue was not that well received. The issue had to be repriced at $14 per share; currently trading on TSX at issue price.


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## Numbersman61 (Jan 26, 2015)

My feeling is that the Underwriters have a lot of stock that they were unable to sell. Eventually, they will be forced to liquidate their position. Their net cost is $13.30 ($14 - $.70 commission). Until this Inventory Problem is solved, I expect the stock to trade below $14. Just a guess.


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## one day at a time (Aug 4, 2019)

Numbersman61 said:


> My feeling is that the Underwriters have a lot of stock that they were unable to sell. Eventually, they will be forced to liquidate their position. Their net cost is $13.30 ($14 - $.70 commission). Until this Inventory Problem is solved, I expect the stock to trade below $14. Just a guess.


I'm not sure about that. This is the email that we received after the ipo from the CEO:

Dear dentalcorp Partners and Team Members,

We are thrilled to announce that dentalcorp has successfully completed the pricing of its $950,000,000 initial public offering and concurrent private placement.

Despite extremely difficult stock market conditions with numerous public offerings being cancelled, the IPO was oversubscribed, positioning dentalcorp with the capital it requires to sustain its path of long-term double-digit growth. At $14 per share, dentalcorp is now valued at over $3.0 billion, representing the highest valuation multiple relative to any other dental platform according to our financial advisors.

We are incredibly privileged to be welcoming some of the world’s largest and most sophisticated institutional investors to our shareholder base, who have taken meaningful and long-term oriented ownership positions in our company.

This offering represents a high watermark for more than just dentalcorp:

Largest Canadian healthcare IPO ever
Top 10 largest Canadian IPO in the past decade
Largest President’s List in Canadian history
With our record-setting President’s List, we can proudly say over 10% of our network are also dentalcorp owners, demonstrating the strong conviction we all have in dentalcorp’s long-term value creation strategy.

We are privileged to have your support and look forward to continuing to serve you, in our capacity as executives and fellow shareholders.

Warm regards,
*Graham Rosenberg*, Chief Executive Officer & Chairman
*Guy Amini*, President
*Nate Tchaplia*, Chief Financial Officer


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