Arxis IPO: Shares of aerospace parts maker begin trading

Preliminary trading in shares of aerospace and defense components supplier Arxis has begun on the Freedom client trading system. Arxis is one of the first defense companies to go public this year as investors seek to capitalize on the increased interest in the sector amid conflicts in the Middle East and Ukraine, according to The Wall Street Journal. Later on April 16, the company's securities will appear on the Nasdaq exchange under the ticker ARXS. To participate, click on the ticker ARXS.

Arxis has raised $1.13 billion in an IPO. The company sold 40.5 million shares at $28 per paper as part of an expanded offering. The offering price corresponds to the upper boundary of the previously announced range ($25-28). Based on the results of the IPO, the value of the entire company can be estimated at about $11.3 billion, according to Bloomberg.

The deal was organized by Goldman Sachs, Morgan Stanley and Jefferies, along with Citigroup, RBC Capital Markets, Baird, Guggenheim Securities, Wells Fargo Securities and William Blair.

Arxis, incorporated in Bloomfield, Connecticut, designs and manufactures specialized electronic and mechanical components. Its product portfolio includes connectors, cable assemblies, RF and microwave components, sensors and mechanical parts such as bearings and seals that are integrated into aerospace, defense and space systems, as well as applications in medical technology and semiconductor testing and industrial automation.

Arxis' key markets are defense and space, which accounted for about 47% of revenue in 2025, and commercial aerospace, which brought in about 23% of revenue last year, the WSJ notes.

In 2025, the company had a net profit of about $46 million on revenue of $1.6 billion, according to the company's IPO prospectus. Arxis was able to come out on the plus side after a net loss of $55 million on revenue of $743 million in 2024.

Arxis is the first company in investment firm Arcline's portfolio to rally for an IPO, the WSJ writes. Arcline has been aggressively expanding Arxis through mergers and acquisitions in recent years, with 32 acquisitions since its formation in 2019, including the $1.8 billion purchase of rival Kaman in 2024, Reuters notes. Following the IPO, Arcline will retain control of Arxis, the prospectus said.

The target price of Arxis shares after the IPO is $35.4, which is 26% higher than the upper boundary of the price range set by the company, says Freedom Broker analyst Alem Bektemirov (Oninvest has his note). In his opinion, one of the main threats for the company is its dependence on government orders: cost cutting, geopolitical uncertainty and delays in budgeting and allocation of funds may negatively affect the demand for the company's products. In addition, there is a risk to future acquisitions if Arxis fails to find suitable acquisition candidates or fails to complete such deals - on favorable terms or at all, Bektemirov added.

Arxis' strengths are its integration into customer platforms and doing business across segments, notes Seeking Alpha analyst Donovan Jones. The markets in which the company operates are facing increased demand driven by increased defense budgets, modernization programs, post-pandemic commercial aircraft production growth, and aftermarket demand, Jones writes.

According to the analyst, the company's weaknesses include its complex, decentralized organizational structure, which can pose risks to project delivery, as well as its dependence on ongoing R&D to remain relevant in rapidly changing and competitive markets. Threats to the company's objectives come from both small, niche players and large suppliers, as well as from regulatory and compliance risks, supply chain disruptions, cost variability and certain customer concentration risks.

Jones lists the continued development of next-generation platforms based on artificial intelligence as well as the company's medical technology business as some of its future directions for the company.

Given the conflicts in the Middle East and Ukraine, the timing of the IPO looks like a very strong decision, according to Troy Hooper, co-head of equity markets at Mergermarket, as quoted by Reuters. The decision to go public confirms the depth and resilience of demand for critical aerospace and defense components, Hooper added.

Arxis' IPO is a significant signal for the aerospace and defense sector and an indicator of how investors in the open market treat defense investments, according to Mike Bellin, head of U.S. IPOs at PricewaterhouseCoopers(quoted in WSJ). How Arxis shares trade after going public, he said, "will determine interest in the next wave of defense sector company offerings." The question for other companies is not whether the market needs these assets, but whether they are ready to meet its requirements, Bellin concluded.

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Freedom clients will be able to get access to Arxis shares before the opening of the main exchange session. Trading will begin in the early pre-market format 2-3 hours before the opening of the US exchanges (from 15:30-16:30 Astana time). To participate, click on the ticker ARXS.

This article was AI-translated and verified by a human editor