A strong stock market turnaround is helping spur a resurgence in companies going public a year after the number of Wall Street newcomers fell to the lowest level since the Great Recession, according to the Associated Press.
Some 55 initial public offerings, or IPOs, have priced so far this year, raising $9.7 billion in proceeds, according to IPO tracker Renaissance Capital. Last year, 71 companies went public, raising $7.7 billion.
The last time there were fewer IPOs was 2009, when 63 companies went public.
All told, 100 companies have filed IPO documents this year, compared to 83 at this point in 2022. Historically, between 150–200 companies go public every year, so the IPO market this year has a way to go to return to a more normal pace.
The rebound in IPOs is being fueled by a resilient stock market rally that has the S&P 500 up about 19% so far this year, a sharp reversal from last year’s 19.4% loss. Despite a still below-average number of IPOs, the stock market rally has helped boost returns for investors in the companies that have gone public more than twofold over last year.
Shares in several companies that have gone public in recent weeks have posted large returns relative to their initial offering price. Shares in restaurant chain Cava Group have more than doubled from the IPO price of $22 per share since its market debut June 15. Another restaurant operator, GEN Restaurant Group, has a 57.7% return relative to its IPO price since its debut June 28.
