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Motley Fool Hidden Gems Investing

Revisiting the IPO Boom

Motley Fool Hidden Gems Investing

The Motley Fool

Investing, Business

4.33.1K Ratings

🗓️ 23 July 2022

⏱️ 25 minutes

🧾️ Download transcript

Summary

Editor's note: This episode was recorded before news of the Coinbase's insider trading case was made public on Friday. 2021 was a milestone year for companies going public. In 2022, the tide turned. Dylan Lewis and Brian Feroldi look back on the IPO boom and discuss: - Reasons why companies go public - Newly-public companies that may never come back to IPO levels - Questions for investors to ask even when financials look strong - The trends that hit Robinhood and Rocket Mortgage - Lessons from pre-revenue companies that went public Stocks mentioned: COIN, HOOD, RKT, NKLA, SPCE, JOBY, RIVN, LCID, SEMR, INTU Host: Dylan Lewis Guest: Brian Feroldi Producer: Ricky Mulvey Engineers: Dan Boyd, Rick Engdahl Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0

Many of these companies that came public during this time that I think are actually pretty

0:05.6

darn good businesses have seen their stocks take similar hits to companies that have no

0:10.1

revenue or have extremely cyclical demand.

0:12.9

But some of these companies came public at very high valuations.

0:16.7

They've continued to perform.

0:18.3

They've continued to execute.

0:19.8

Some of these companies are profitable and should be sustainably profitable and yet they've

0:24.3

still seen massive hits to their stock prices.

0:31.1

I'm Chris Hill and that's a Motley Fool contributor Brian Faraldi.

0:35.1

2021 was a record year for companies going public.

0:38.6

This year that market has dried up.

0:41.9

Faraldi joined Dylan Lewis for a look back at the IPO boom, why so many companies went

0:47.0

public and the lessons investors can take from the formerly red hot market.

0:52.6

They've discussed the cyclical companies that may never come back to their IPO prices

0:57.2

and the strong businesses making their way through a less forgiving stock market.

1:02.6

2021 was a milestone year for new names to the public markets.

1:09.4

According to Ernst and Young globally, there were 2500 public debuts last year raising around

1:14.7

400 billion in the process.

1:17.8

The story in 2022 for the first half of the year proceeds are down almost 50% and global

1:23.8

IPO volumes are down about 50% as well.

1:26.9

Joining me to talk about the IPO market and lessons from the last couple of years is Motley

1:31.2

Fool contributor Brian Faraldi.

...

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