The IPO Market Is Back

IPOs are back. Thanks to the market’s recent rally, a spate of companies are looking to go public. Bloomberg reports that December is on pace to be the biggest month ever for new offerings.

This week, DoorDash and Airbnb will start trading. In fact, both stocks just raised their offering range which is a sign of strong demand.

Airbnb had been looking at a price range of $44 to $50 per share. Now that’s up to $56 to $60 per share. DoorDash went from a range of $75 to $85 per share up to $90 to $95 per share. Earlier this year, Airbnb had been valued at $18 billion. If this week’s offering goes off smoothly, then the company will be valued at $42 billion.

What’s the reason for the excitement? Thanks to the pandemic, a number of IPO candidates sat out the market. Now, the outlook looks much better. In fact, several more IPOs are on the way.

Airbnb and DoorDash will quickly be followed by three other mega-listings that could add billions of dollars to the IPO tally.

Also on deck to go public this month are Affirm Holdings Inc., which lets online shoppers pay for purchases such as Peloton bikes in installments, online video-game company Roblox Corp. and ContextLogic Inc., the parent of discount online retailer Wish. Each is likely to attain a valuation of tens of billions of dollars in its listing.

The New York Times quoted one investor as saying, “almost every hot company is being pursued like mad.”

Posted by on December 7th, 2020 at 11:00 am


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