Anticipated Initial Public Offerings to Keep an Eye On
The IPO market has seen a resurgence in the second half of 2025, after a shaky start due to uncertainty surrounding tariffs and stock market volatility. This revival has been marked by the entry of more notable names into the public sphere, with renewed demand for growth stocks playing a significant role.
The recent performance of FIG, an online design platform, serves as a reminder of the risks associated with IPO investments. Despite a strong first day performance, FIG's IPO gained only a 66% increase by early September. This shift underscores the inherent volatility of the stock market today.
Despite the market volatility, the major U.S. equity indexes are trading at all-time highs, led by tech stocks. This strong performance has been supported by softer-than-expected tariff rates and massive spending by AI hyperscalers.
Renaissance Capital Director of Investment Strategies, Avery Marquez, stated that the IPO market is in a good position and a long-awaited pickup is finally materializing. According to their data, 143 deals have been priced so far this year, up 55% compared to 2024. The total amount raised through these IPOs is $22.7 billion.
Among the companies preparing for IPOs in the coming months are those from the e-commerce sector in Hamburg, pharma, transmission networks (Tennet Deutschland), personnel software (Personio), and fintech (Klarna). Personio, a tech sector personnel software provider, and Klarna, a fintech company with a significant tech connection, have already had successful IPOs.
However, most companies listed for IPO are not directly linked to AI hyperscalers. Established tech giants such as Apple, Microsoft, Alphabet, Amazon, and Tesla, which have strong AI and cloud computing ties, are not IPO candidates.
Marquez anticipates a continuous flow of new issuance through the fourth quarter. Investors are advised to consider IPOs as a portion of their high-risk assets, typically 5% to 10% of their portfolio.
Any significant disruptions to market stability or investor confidence could potentially slow down the IPO market pickup. Uncertainty around tariffs and inflation continues to exist in the market, and any escalation could impact the full-blown pickup of the stock market today.
In conclusion, while the IPO market has shown signs of recovery, it remains a volatile landscape. Investors should approach IPO investments with caution and diversify their portfolios to manage risk.
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