Another Strong Year for IPO Stocks

Shares of companies that raised at least $100 million at their initial public offerings (IPOs) since the beginning of 2023 have outperformed the S&P-500 Index by an average of 18%. This suggests a positive trend in the performance of recently listed companies, as indicated by their stock market performance compared to the broader S&P 500 index, accord­ing to Fin­an­cial Times ana­lysis of Dea­lo­gic data. -chart from FT

In 2023, companies raised $20 billion in new listings in the United States, as reported by Dealogic. While this figure marked a significant increase compared to the previous year, more than doubling the amount, it was still nearly 90% lower than the total raised in 2021. The $20 billion in new listings made it the third-lowest annual total over the past decade, indicating a decline in the volume of funds raised through initial public offerings (IPOs) during that period.

Since the beginning of 2023, the Renaissance IPO Index, which tracks the performance of companies that went public over the previous three years, has experienced a 44% increase. This outperformed the S&P 500 index, which gained 24%, and the Nasdaq Composite, which saw a 42% increase. The positive performance of the Renaissance IPO Index suggests strong returns for companies that recently went public during that period. ∞ALPHA