If the stock market outlook brightens, there are expectations for a bumper crop of initial public offerings to make their debuts over the next several weeks.
Somewhere between 90 to 110 IPOs are preparing to come public by the end of the year, which would make 2021 the biggest year for total capital raised since 2000.1
But a sluggish stock market may disrupt the best-laid plans. The Standard & Poor's 500 index lost nearly 5 percent in September—snapping its seven-month winning streak.2
Companies attempt to make a splash with their IPO, and in the past, some have opted to postpone their public listing if they believe it will meet a lukewarm reception from investors.
The primary objective of an IPO is to raise money to operate the business. Going public also can increase a company's public profile, which might help boost sales. But there are several disadvantages, including the fact that an IPO is expensive, and the new status requires additional costs unrelated to running the business.3
If you have your eye on an IPO, please reach out. One of our professionals may be able to help you find additional research on the company.
1. CNBC.com, September 9, 2021
2. Reuters.com, September 30, 2021
3. Investopedia.com, February 29, 2021
Investing involves risks, and investment decisions should be based on your own goals, time horizon, and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The S&P 500 Composite Index is an unmanaged group of securities considered to be representative of the stock market in general. Index performance is not indicative of the past performance of a particular investment. Past performance does not guarantee future results. Individuals cannot invest directly in an index.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite, LLC, is not affiliated with the named representative, broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security.
Will the IPO Market Heat Up?
October 05, 2021