The year 2019 was dubbed the year of IPO. Many venture capitalists and early investors tried to seize an opportunity of investing in IPO stocks and generating higher profits. Not everyone succeeded. Some failed so big that they became the laughingstock. We’re looking at you, WeWork.
The commercial real estate company reported a net loss of $904 million on a $1.54 billion revenue for the first six months of 2019. For the third quarter of 2019’s fiscal year, it reported a staggering $1.25 billion net loss on a $934 million revenue.
No one else was such a huge flop, but some Silicon Valley unicorns, such as Uber, Lyft, and Pinterest, went public in 2019 only to struck out. They all got hit pretty hard, but Uber failed miserably.
Yet, the ridesharing giant might turn the tables around this year. The future is also looking bright for its rival, Lyft, as well as for Pinterest.
With that in mind, take a look at how the most prominent IPOs from Silicon Valley have performed until now, and what we can expect from them in 2020.
Uber went public on May 10, 2019, with an IPO price of $45. The opening price of its shares was $42 (down 6.6%), and it closed with $41.57 (down 7.6%). It raised $8.1 billion in IPO, with a public market cap of $82 billion.
The current price of Uber’s stock is $33.97 per share, which is an increase from its previous prices. It has been increasing lately, so its future does look promising.
Uber’s failure in IPO was in large part because its rivals cut prices to a great extent to steal its customers, forcing Uber to cut prices as well. Yet, the ride-hailing company is rapidly improving.
Its chances of yielding positive results in IPO this year are very high, especially since Lyft has recently started increasing its prices for the first time. Uber’s recent increase in EBITDA margins from 8% to 22% shows that the ridesharing giant might pull off the impossible in 2020.
On March 29, Lyft started trading on Nasdaq with an opening price of $87.24, up 21% from its set IPO price of $72. It closed with $78.29, a slightly lower price than its opening one, but it was still up 8.7% from its IPO price.
With a market cap at IPO of $24.3 billion, it managed to raise $2.34 billion in IPO.
Its current stock price of $45.59 per share is significantly down from its IPO price. Yet, Lyft seems to be improving, just like its rival Uber. Its revenue and number of riders keep growing, and it’s estimated that its bookings will increase by 25% in 2020. The company also keeps steadily cutting its losses.
Pinterest is one of the IPOs that might outperform all the other stocks on this list in 2020. In the last quarter of 2019, its EBITDA profit reached $3.8 million, while all these other IPOs faced huge losses.
The social media company debuted on April 18 with the opening price of $23.75, up 25% from its IPO price of $19. It closed with $24.40, up 2.7% from its IPO price. Its current stock price has recently surpassed its IPO price ($19.63). This shows that it’s good to bet on Pinterest this year.
It raised $1.43 billion in IPO, with a market cap at IPO of $12.6 billion.
Pinterest is still in its infancy stage when it comes to monetizing its platform. Even so, experts estimate that it has a promising future and will soon become profitable.
Zoom was one of the top IPO performers in 2019. When it went public on April 18, it was already turning a lot of profit, and it immediately soared on its public debut.
Pricing its IPO at $36 per share, the video-conferencing company saw a huge jump in its shares after only one day of trading. Its opening price of $65 per share was up 80.5% from its IPO price, while its closing price dropped to $62 (down 4.6%), which was still up from its IPO price (72%).
With an IPO market cap of $16 billion, it raised $356.8 million in IPO.
Zoom’s current stock price is $72.62 per share, and it has been increasing rapidly, showing that the company is definitely on the right path to success.
Slack used a direct listing when it went public on June 20, 2019, which caused quite a stir. It set a reference price of $26 per share and started trading with an opening price of $38.50 (up 48% from its IPO price). It closed with $38.62 (up 0.3%).
Since it used a direct listing, it didn’t raise any money in IPO, but it did start trading stocks with a bang. Its current stock price is $23.17 per share, so it still shows potential for investors.
Moreover, it raised $1.4 billion from private investors, becoming one of the most prominent Silicon Valley startups.
CrowdStrike was one of the best-performing IPOs in 2019. Its public market debut on June 12 started with an IPO price of $34 per share. Its opening price jumped to $63.50 (which was up 86% from its IPO price), and its closing price was $58 per share (down 8.7%, which was still quite higher than its IPO price).
It raised $612 million in IPO for the year, experiencing several ups and downs, including a huge jump to $99.39 per share in August.
Its current stock price is $55.94 per share, which proves that the cybersecurity company is only going to grow bigger and more profitable. It was cash flow-positive in 2019 and is expected to continue flourishing in 2020 as well.
Although not all these IPOs have been shining stars last year, they are bound to take a victory lap in 2020. And who knows, maybe 2020 will be another historic year for IPO.