A boom in U.S. initial public offerings that began in 2020 has accelerated in 2021. With stock prices at record highs, traditional IPOs have raised $168.8 billion so far in 2021, up 108% from 2020’s total.
There have been 368 traditional IPOs filed this year, a 67% increase compared with 2020. The health care and technology IPO markets have been particularly active, accounting for a combined 68% of all U.S. IPOs in the past 12 months, according to Renaissance Capital.
One of the highest-profile IPOs of October for investors was code-sharing software company GitLab Inc. (ticker: GTLB). GitLab priced its $650 million IPO at $77 on Oct. 13, but the stock is already trading above $125 less than a month after its first day on the market.
Despite concerns over supply chain disruptions, inflation and Federal Reserve tightening, the investing community expects more major IPOs in November. Here are five IPO stocks to watch:
— CI&T Inc. (CINT)
— Rivian Automotive Inc. (RIVN)
— Nu Holdings Ltd. (NU)
— Authentic Brands Group LLC (AUTH)
— Fresh Market Holdings Inc. (TFM)
CI&T Inc. (CINT)
CI&T is a Brazilian company that provides outsourced information technology services. The company’s high-profile customers include Johnson & Johnson ( JNJ), Alphabet Inc. ( GOOG, GOOGL) and Coca-Cola Co. ( KO).
Unlike many other recent high-growth IPOs, CI&T has generated a three-year compound annual revenue growth rate of 28% while also turning a net profit.
CI&T was founded in 1995 and reported $223 million in revenue in the 12 months ending on June 30, 2021. The company plans to use IPO proceeds in part to fund acquisitions that will help it expand its footprint in North America and Europe.
CI&T plans to raise $350 million by selling 19.4 million shares in a target price range of between $17 and $19 per share.
CI&T’s IPO underwriting team is led by Goldman Sachs Group Inc. ( GS), Citigroup Inc. ( C) and JPMorgan Chase & Co. ( JPM). The stock is expected to begin trading on the New York Stock Exchange under the symbol CINT on Nov. 10.
Rivian Automotive Inc. (RIVN)
The company plans to raise $8 billion from its IPO, selling 135 million shares in a target price range of between $72 and $74 per share. The targeted price range suggests a company valuation of around $65 billion, potentially earning Rivian the title of largest IPO of 2021.
Investors likely see Rivian and its CEO R.J. Scaringe, who holds a doctorate in mechanical engineering from Massachusetts Institute of Technology, as a potential challenger to Tesla Inc. ( TSLA) in the red-hot electric vehicle space. Rivian began delivering its R1T five-passenger electric pickup truck in September. Rivian currently has at least 48,000 preorders for its consumer vehicles and an initial order of 100,000 electric delivery vans from key investor Amazon.
Rivian shares are expected to begin trading on the Nasdaq under the symbol RIVN on Nov. 10.
Nu Holdings Ltd. (NU)
Nu Holdings is a digital banking platform focused on Brazil, Mexico and Colombia. The company has one of the largest global digital banking platforms and serves 48.1 million customers in Latin America.
Nu plans to dual list in Brazil and the U.S. and raise up to $3 billion in its IPO by selling 289.2 million shares, including some in the form of Brazilian depositary receipts, that will trade on the NYSE under the ticker NU. At the proposed IPO price range of between $10 to $11 per share, Nu would be valued at roughly $50.8 billion.
One of Nu’s major selling points is backing from high-profile investor Warren Buffett. Berkshire Hathaway Inc. ( BRK.A, BRK.B) invested $500 million in Nu’s last private fundraising round back in June, which valued the company at around $30 billion.
Nu reported $1.3 billion in revenue for the 12 months ending on Sept. 30, 2021. The company publicly filed its IPO paperwork on Nov. 1, so a November IPO is possible.
Authentic Brands Group LLC (AUTH)
Authentic Brands is a brand management group that has partnered with shopping mall operators to acquire struggling mall retailers facing the prospects of bankruptcy, including Aeropostale, Brooks Brothers and Forever 21. Authentic also owns Juicy Couture, Sports Illustrated and the brand rights to Marilyn Monroe and Elvis Presley.
The company reported $211 million in income in 2020, up from $72.4 million in 2019. Revenue grew from $165 million in 2016 to $489 million in 2020. Authentic Brands is reportedly seeking a $10 billion IPO valuation.
Authentic still hasn’t announced an official IPO date. However, it’s now been several months since its filing date on July 6, so a November listing is certainly a possibility. Authentic plans to trade on the NYSE under the ticker AUTH.
Fresh Market Holdings Inc. (TFM)
Like Authentic Brands, Fresh Market has made little progress since it officially filed its IPO paperwork on July 16. The Fresh Market is a gourmet grocery store chain that first went public back in 2010 but struggled to hold its own competing against high-growth companies like Kroger Co. ( KR) and Whole Foods.
Apollo Global Management Inc. ( APO) took Fresh Market private in 2016 in a $1.4 billion deal priced at a 30% premium to its initial IPO price six years earlier.
Apollo spent the next five years restructuring Fresh Market’s business. The company has said it plans to raise $100 million in its IPO, but Renaissance Capital projects a figure closer to $250 million.
Fresh Market reported $1.9 billion in revenue for the 12 months ending in April 2021. The company has not yet announced an official IPO date. But given its July filing, the company could begin trading on the Nasdaq under the ticker TFM sometime in November.
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