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Buoyed By High Stock Prices, IPOs On Pace For Record Year

Companies ranging from online sports wagering to pharmaceuticals to eCommerce ventures are benefiting from what appears to be a record-breaking year of initial public offerings (IPOs), according to a Monday (July 26) report from CNBC.

So far in 2021, proceeds from U.S. IPOs have climbed to $89 billion, a more than 230 percent spike from the same period in 2020, according to the report. Some of the top-performing IPOs to date include E-Home Household, which saw a 380 percent increase and a first-day return of 1,100 percent; and online gambling company Esports Technologies, which saw a 254 percent gain and a 507 percent first-day return, according to the report.

Yet, despite soaring IPOs for some companies, as reported previously, other companies have witnessed a less-than-enthusiastic response to their IPOs. Earlier this month, in a week tied with two other weeks for the calendar year’s busiest week to date, two big IPOs fell short of investors’ expectations. In that same week, which ended on July 16, all 18 Wall Street IPOs were 1.3 percent below the offerings’ prices. Experts had said the slump could impact future significant IPOs, including Robinhood Markets Inc. and Instacart Inc., which are expected to go public soon.

Even with the earlier backslide, analysts agree that 2021 will be a record-breaking year for IPOs. In June, Reuters reported that U.S. IPOs had already reached $171 billion and were on track to beat the 2020 record of $168 billion.

As PYMNTS reported previously, several large deals are likely to keep the record-breaking momentum going. China-based ride-hailing firm Didi Global is expected to raise almost $4 billion. According to Renaissance Capital, the period from April through June 2021 saw 113 deals with raised almost $40 billion. The IPO market has been faring well, with records shattering in terms of post-2000s deal numbers. CNBC reports that the market is expected to break the full-year all-time record of $97 billion raised in 2000 that resulted from the dot-com boom.

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