Q4 2023 IPO market trends (2024)

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Q4 2023 IPO market trends? ›

The final quarter of 2023 saw 40 new initial public offerings (IPOs), raising a total of $4.2 billion. This is a slight decline in total IPOs from Q3, but a much larger drop in total proceeds, which decreased by 54% in Q4. However, compared to Q4 2022, IPOs doubled while the total amount raised increased by 127%.

In 2023, global IPO volumes fell 8% and proceeds were down 33% compared with 2022. Last year's IPO market was in flux, featuring improving market sentiment in the West and a slowdown in China, as well as a contrast between a large number of smaller-cap deals and a few larger high-profile offerings.

There were just 370 IPOs launched globally in the fourth quarter of 2023, down from 417 in the fourth quarter of 2022 and 921 in the same period of 2021, according to the latest S&P Global Market Intelligence data. This was the slowest fourth quarter since 2012, when there were 285 IPOs worldwide.

However, US IPO activity is already improving in 2024, with the number of US IPOs during the first two months of 2024 up 24 percent compared to the same period last year, as well as the landmark IPO of social media company Reddit on the New York Stock Exchange in March, pricing at the top end of its range and showing ...

Summary. The US IPO market in Q1 2024 exceeded Q1 2023 by a significant margin, raising $8.7b in proceeds compared to $2.6b, despite comparable deal volume. Investors remain focused on large, established companies, with the health care and technology sectors continuing to dominate IPO activity.

The Computer & Electronics was the largest sector in terms of IPO proceeds in 2023, raising $34.4bn, followed by the Healthcare ($10.7bn) and Finance ($9.6bn) sectors. Since 2021, technology has been consistently the largest sector in terms of IPO proceeds and brought the largest IPO for 2023.

There were certainly some big deals in 2023. The 10 largest IPOs raised a combined $13.8 billion—71 percent of total proceeds for the year. The biggest was Arm Holdings—an established tech company—which raised nearly $5 billion and ended the year up 39 percent.

Arm Holdings PLC was the largest IPO in 2023. The UK-based leader in CPU technology raised $4.8 billion from its listing on NASDAQ in September. While it was the leading IPO for 2023, Arm Holdings was also the fifth largest IPO since 2019. Kenvue Inc.

Astera Labs' and Reddit's recent public listings fetched modest valuations — but their IPOs proved that there's pent-up appetite from investors for new stocks.

IPO 12 Months Forecast

Based on 54 Wall Street analysts offering 12 month price targets to IPO holdings in the last 3 months. The average price target is $44.02 with a high forecast of $54.87 and a low forecast of $33.12. The average price target represents a 18.29% change from the last price of $37.21.

Is it good to buy IPO now? ›

Buying an IPO can be a good idea. It's a regular practice of crossover investors who get in on the ground floor of a stock with high upside potential. They may reap the rewards at some point in the future as the stock appreciates over time.

The share of companies in the United States which were profitable after their IPO decreased overall between 2009, when it peaked at 81 percent, and 2020, when it was as low as 22 percent. In the last two years, the share of profitable IPO companies increased again, reaching 34 percent in 2022.

It's important to know that first-day gains don't always last. While a third of IPOs trade lower by day one, a full half of IPOs trade lower by day two. If the volatility is extreme, the stock may experience what's called a "whipsaw," or upward price movement followed by a sharp decline in value.

Viking IPO Crowns April Best Month for US Debuts Since September.

In Q1 2024, global IPO volumes fell 7%, but proceeds were up 7% year-over-year (YOY). An improvement in valuations and pricing levels reflects growing confidence among both issuers and investors. Momentum is building for private equity (PE)-backed IPO exits in 2024, with Q1 2024 average deal size up 26% from 2023.

The 2023 IPO market was slow to suggest improvement over the relatively dormant stream of deals in 2022. There were 171 companies that went public compared with 218 in 2022; however, in terms of capital that was raised, 2023 was slightly more successful — reaching $26.2 billion versus $24.2 billion in 2022.

The U.S. stock market performed extremely well in 2023 and for the 5-year period ended December 31, 2023. Stock market performance in 2023 was a reflection of the relatively strong U.S. economy. The S&P 500 index increased 24.31 percent, more than twice the long-run average return on U.S. large-cap stocks.

There were 154 IPOs on the US stock market in 2023. This was 15% lower than the 181 IPOs in 2022, and 85% lower than the all-time record number of 1,035 IPOs in 2021.