(Reuters) -Cancer diagnostic firm Caris Life Sciences said on Monday it is targeting a valuation of up to $5.3 billion in its U.S. initial public offering, as the market for new listings rebounds.
Irving, Texas-based Caris, backed by investment firm Sixth Street, is seeking up to $423.5 million by offering 23.5 million shares priced between $16 and $18 apiece.
The IPO market is heating up as high-profile companies move ahead with their stock market listings in a calmer period after tariff-related volatility stifled deal activity earlier this year.
Caris is an artificial intelligence-based precision medicine firm that helps diagnose cancer through its tumor profiling and blood-based cancer diagnostics.
Founded in 2008 by CEO David Halbert, Caris generates revenue mainly from its tissue-based molecular profiling, which helps select the appropriate cancer therapy.
The company, which competes with Guardant Health and Grail, saw its revenue jump 35% to $412.3 million in 2024.
It has run more than 6.5 million tests on 849,000 cases and works with over 100 biopharma partners, including Moderna and AbbVie.
Caris raised $830 million at a $7.83 billion valuation in a Sixth Street-led 2021 funding round. It is also backed by J.H. Whitney, one of the oldest U.S. private equity firms.
The valuation target places Caris' estimated price-to-sales ratio at about 13, positioning it at the high end of its peer group, said IPOX research analyst Lukas Muehlbauer.
"While the company's financials show positive momentum, Caris must ultimately prove that its AI translates into superior clinical outcomes in a highly competitive landscape," Muehlbauer said.
Investment manager Neuberger Berman may buy up to $75 million of shares in the offering. The flotation comes a year after SoftBank-backed precision medicine firm Tempus AI went public. The stock has gained 67.8% as of Friday's close.
BofA Securities, J.P. Morgan, Goldman Sachs, and Citigroup are the lead underwriters. Caris will trade on the Nasdaq under the symbol "CAI."
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Leroy Leo and Maju Samuel)
By Arasu Kannagi Basil
