Scrubs maker FIGS soars in healthy market debut

Doctors and nurses aren't likely to be strutting down runways in Milan or New York in their scrubs. But if they did appear in fashion shows, they'd likely wear outfits designed by FIGS, the trendy health care apparel company that went public Thursday.

Posted 5:17 p.m. May 27, 2021 — Updated 5:17 p.m. May 27, 2021

Paul R. La Monica

, CNN Business

CNN — Doctors and nurses aren't likely to be strutting down runways in Milan or New York in their scrubs. But if they did appear in fashion shows, they'd likely wear outfits designed by FIGS, the trendy health care apparel company that went public Thursday.

Shares of FIGS surged more than 35% from their initial public offering price of $22 in their market debut. At a price of around $30, the company was valued at nearly $5 billion.

In another sign of how strong demand was, FIGS priced its IPO above its expected range and sold more shares than planned.

FIGS is also making history as the first IPO that allowed Robinhood customers to get the stock at the IPO price as opposed to waiting to buy if after it began trading.

The company said in its registration filing with the Securities and Exchange Commission that about 1% of the 26.4 million shares sold in the offering were allocated to investors on Robinhood's online brokerage platform.

FIGS, unlike many other startups that have gone public in recent years, is also profitable. The company reported net income of $58 million in 2020 and earnings of $16 million in the first quarter of 2021 as its sales and customer base both more than doubled.

The company, which touts its scrubs as being more fashionable and comfortable than standard- issue medical apparel, also said in its SEC filing that is benefiting from the fact that "healthcare apparel purchasing has shifted from institutions to the individual, with approximately 85% of all medical professionals now purchasing their own uniforms."

FIGS also noted that "due to frequent wear, healthcare apparel continuously needs to be replenished, resulting in highly predictable, recurring demand for such products."

FIGS is the latest unicorn to take advantage of the stock market's strength this year and go public, joining the likes of ZipRecruiter, Oatly, Jessica Alibaba's The Honest Company and Coinbase.

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