In this piece, we will take a look at ten recent IPOs in 2023. If you want to skip background activity in the sector this year, then head on over to 5 Recent IPOs in 2023 to Consider.
Most companies don’t list their shares on the stock market. While big ticket names such as Apple, Microsoft, NVIDIA, and Tesla get all the attention, the fact is that only 0.1% of companies in the U.S. have more than 500 employees. Yet, as any fan of the stock market would point out, the biggest companies are often the most valuable or have the most value. And, most of the biggest companies are often either state backed or publicly traded as back of the envelope estimates show that the top ten largest companies in the world in revenue terms are publicly traded.
Going public brings a multitude of benefits for both the firm and the investors that buy its shares. For the firm owners, if the initial public offering (IPO) is successfully executed and a strong business plan generates interest, then their shareholdings can significantly appreciate in value. As a simple example, consider the fact that Tesla, Inc. (NASDAQ:TSLA) CEO Mr. Elon Musk became the company’s majority shareholder in less than two years after it was incorporated by just pitching in $6.5 million in a Series A funding round. Now, Musk’s current stake in America’s largest electric vehicle manufacturer is worth a rather sizeable $190 billion. On a side note, Tesla has also limited the ability of shares that have been pledged for loans and can be collateralized to less than 25% of the stock unless less than $3.5 billion, interesting considering the fact that Musk has pledged almost 58% of his Tesla stock.
So, back to IPOs. Tesla went public in 2010 and since then the stock is up by more than 20,000% – which turns a dollar invested back then to more than $200. Not bad considering that only a few companies can beat or match this performance. For instance, the most expensive share on the stock market is Berkshire Hathaway Inc. (NYSE:BRK-A), whose gains on the market since stock started trading turn a dollar back then into more than $500 now, similar to the shares of NVIDIA Corporation (NASDAQ:NVDA) but significantly less than Apple’s.
While new firms tend to thrive in an open credit environment with low inflation and stable growth rates, the rapid shifts in the U.S. economy have not deterred a lot of firms from making the plunge and listing their shares for trading. Data shows that as of end July 2023, nearly 91 firms have gone public, and the group has shown modest performance on the market after listing. Out of these, only 53% are trading higher than their listing price. The percentage of firms demonstrating positive returns grows when only the second quarter of 2023 is considered. During the three months between April and June, 34 firms listed their shares for trading and 19 are in positive territory. July continues to extend this trend, as between May and July, an impressive 21 firms out of the 32 that have listed their stock have seen positive buying activity from investors.
One rockstar on the stock market that IPO’d earlier this year is the biotechnology firm Genelux Corporation (NASDAQ:GNLX). Genelux listed its shares in January, and the stock is up an impressive 286% year to date with the biggest share price gains taking place between February and mid-June. It develops treatments for ovarian cancer and has reported some positive data since listing the shares.
A share price pop after an IPO doesn’t have to last only a couple of days. After all, the biggest pops take place over the years, decades perhaps. Going long on the right stocks is quite rewarding, with one of the most successful investors of all time Warren Buffett smartly using this strategy. Our own research of some firms that started trading in pennies at the time of their public listing shows that a few have literally turned a dollar into a grand. Consider the story of Amazon.com, Inc. (NASDAQ:AMZN), one of the world’s largest electronic commerce retailers. Amazon’s shares IPO’d at $15, which translates into $0.075 after adjusting for four stock splits that split the shares 27 to 1. They currently trade at $128, which marks a stunning gain of 170,600%. In short, a dollar put in Amazon’s stock in 1997 would be worth $1,706 today – a fact that has turned the firm’s founder and former CEO Mr. Jeff Bezos into one of the richest men on Earth.
So, what are some IPOs that have taken place recently that rank high in terms of market capitalization? We took a brief look and narrowed down some firms.
Pixabay/ Public Domain
Our Methodology
To compile our list of IPOs to consider, we gathered firms that have listed their shares for public offering this year and ranked then by market capitalization. Out of these, the largest firms are selected and the list by all means is not exhaustive of all firms that have had an IPO in 2023.
10 Recent IPOs in 2023 to Consider
10. Kenvue Inc. (NYSE:KVUE)
Latest Market Capitalization: $46.60 billion
Kenvue Inc. (NYSE:KVUE) is a subsidiary of Johnson & Johnson and it sells a variety of wellness products such as pain, allergy, and nicotine addiction medication. Its shares started trading on the NYSE Exchange in May and it is currently facing an offer from J&J to let J&J shareholders exchange their shares for Kenvue Inc. (NYSE:KVUE)’s shares.
Since its a new addition to the stock market, no hedge fund part of Insider Monkey’s database of 943 hedge funds owned Kenvue Inc. (NYSE:KVUE)’s shares by the close of March 2023. J&J owns roughly 90% of Kenvue Inc. (NYSE:KVUE)’s outstanding stock as of late July 2023. Out of the nine analysts that covered the stock in July, six had rated the shares as Hold. But, two Buy ratings and one Strong Buy rating tilt the average sentiment around the stock to Buy.
9. Nextracker Inc. (NASDAQ:NXT)
Latest Market Capitalization: $7.06 billion
Since it’s not a J&J subsidiary, Nextracker Inc. (NASDAQ:NXT) whose shares started trading in February has a lower market capitalization of $7.06 billion. Nextracker Inc. (NASDAQ:NXT) is a solar technology company that makes and sells products such as trackers capable of suiting solar panels mounted on different terrains.
Nextracker Inc. (NASDAQ:NXT) is quite popular among hedge funds as well, since 29 of the 943 tracked by Insider Monkey had bought and invested in the company by Q1 2023 end. The analyst sentiment of the shares is also quite strong. The majority of analysts that covered the stock in June and July had rated the shares as Buy, and eight of the 32 analysts covering Nextracker Inc. (NASDAQ:NXT) have rated the shares as Hold.
8. CAVA Group, Inc. (NYSE:CAVA)
Latest Market Capitalization: $5.94 billion
CAVA Group, Inc. (NYSE:CAVA) is a restaurant chain with a retail presence all over the U.S. in states including Maryland, Georgia, Colorado, Alaska, Arizona, and Alabama. The firm’s IPO kicked off and lasted through the third week of June, and the stock is up an impressive 37% since then.
CAVA Group, Inc. (NYSE:CAVA) is a consumer discretionary stock, which means that its fate is tied to the U.S. economy and discretionary income. It also has a Strong Buy rating on average; however, the average share price target of $45.86 is quite lower than the current share price of $51.64. J.P. Morgan had led the IPO and the firm aims to use the proceeds to further expand its already large national presence.
7. ATS Corporation (NYSE:ATS)
Latest Market Capitalization: $4.48 billion
ATS Corporation (NYSE:ATS) is a Canadian industrial equipment manufacturer that was set up in 1978. It is an engineering company that helps industrial users to set up their production lines and manage business functions such as supply chain management. Its IPO ended in May and the firm generated $282.9 million in gross proceeds.
Not taking it slow after the IPO, ATS Corporation (NYSE:ATS) hopped on to the current interest in artificial intelligence and acquired a Belgian company that tailors AI tools for industrial use in July. Within weeks, this was followed by another acquisition that saw ATS Corporation (NYSE:ATS) bring in a life sciences technology company under its wing as well.
6. Savers Value Village, Inc. (NYSE:SVV)
Latest Market Capitalization: $4.02 billion
Savers Value Village, Inc. (NYSE:SVV) is a retailer that refashions used fabrics for sale in Australia, Canada, and the United States. It makes purchases from non-profits, beefing up its socially conscious credentials. Savers Value Village, Inc. (NYSE:SVV) has been in business for decades too, as the firm was set up in 1954 and is headquartered in Bellevue, Washington.
Savers Value Village, Inc. (NYSE:SVV) is one of the more recent IPOs on our list, as its shares started to trade only on June 29th. The shares were offered at a price of $18 and have crossed $25 since then.
Click to continue reading and see 5 Recent IPOs in 2023 to Consider.
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Disclosure: None. 10 Recent IPOs in 2023 to Consider is originally published on Insider Monkey.
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