These highly anticipated IPOs could come by the end of the year.
In 2021, 397 U.S. companies listed their shares via traditional initial public offerings, raising $142.4 billion collectively. The 2021 IPO market was the hottest in more than 20 years, but underwhelming performance by many of these IPO stocks coupled with a weak stock market so far in 2022 has caused the IPO market to dry up completely. Through mid-September, there have been just 59 U.S. IPOs in 2022 that have raised a mere $4.6 billion. High-profile 2021 IPO stocks, including Rivian Automotive Inc. (ticker: RIVN), Robinhood Markets Inc. (HOOD) and DiDi Global (DIDIY) are now trading well below their IPO prices. However, these 10 upcoming IPO stocks could still provide investors with excellent long-term opportunities.
Stripe is a financial services and software-as-a-service company that focuses primarily on online payment processing software and application programming interfaces for e-commerce websites and mobile apps. Stripe’s latest private fundraising round in March 2021 valued the company at a staggering $95 billion, a valuation which would potentially make Stripe one of the largest IPOs in history. However, the Wall Street Journal reported in July that Stripe cut the internal value of its shares by 28%, implying a $74 billion valuation. In addition, investor T. Rowe Price recently cut its estimated value for Stripe shares to a level implying a $59 billion valuation.
Potential 2022 IPO valuation: $59 billion to $74 billion.
VinFast is the electric vehicle subsidiary of Vingroup, Vietnam’s largest conglomerate. VinFast has said it plans to begin shipping SUVs in the U.S., Canada and Europe by the end of the year, aiming to ramp up sales from 42,000 vehicles in 2022 to 750,000 vehicles by 2026. VinFast had initially aimed to raise $3 billion at a $60 billion IPO valuation, but that high of a valuation is likely overly optimistic at this point. In July VinFast announced it has raised at least $4 billion from banks to fund its U.S. expansion, including the construction of a factory in North Carolina. Although the company has already filed for a U.S. IPO, the latest funding may push back its listing until at least 2023.
Potential 2022 IPO valuation: $25 billion to $60 billion.
Databricks is a market leader in tools designed to simplify database management, using artificial intelligence to organize and visualize big data. The company has said it will generate more than $1 billion in revenue in 2022, up more than 75% compared to 2021. Databricks raised $1.6 billion in funding in 2021 at a valuation of $38 billion, although its valuation has likely taken a significant hit in the weak 2022 tech market. The company’s high-profile financial backers include Amazon.com Inc. (AMZN), Salesforce Inc. (CRM), Alphabet Inc. (GOOG,GOOGL) and Bank of New York Mellon Corp. (BK). Databricks also recently reported its impressive growth rate has not slowed in 2022.
Potential 2022 IPO valuation: $38 billion.
Mobileye develops autonomous driving technologies and advanced driver-assistance systems, including software, cameras and semiconductors. Mobileye previously went public back in 2014 at a valuation of $5.3 billion but was acquired by chip giant Intel Corp. (INTC) in 2017 for $15.3 billion. Intel now plans to once again take Mobileye public via an IPO. Intel initially planned to conduct the Mobileye IPO in mid-2022, and media reports suggested its valuation could be upward of $50 billion. However, in September, Bloomberg reported that people familiar with the process say Intel is now targeting a $30 billion IPO valuation for Mobileye in the difficult market.
Potential 2022 IPO valuation: $30 billion.
Chime Financial Inc.
Chime is a financial technology, or fintech, company that provides digital banking and other financial services to low-income and underbanked customers. Instead of relying on irritating and potentially predatory overdraft and monthly fees, Chime earns money via its Visa Inc. (V) debit card offerings. Chime gets a percentage of the interchange fees each time its card is used. The company was valued at $25 billion in 2021 and was initially expected to complete its IPO led by lead underwriter Goldman Sachs in the first half of the year. Unfortunately, Barron’s reported in late May that deteriorating market conditions have likely delayed the Chime IPO until at least 2023.
Potential 2022 IPO valuation: Up to $25 billion.
Instacart is a grocery pickup and delivery service that has been putting up the kind of growth numbers that certainly get investors’ attention. In August, the Wall Street Journal reported Instacart’s revenue was up 39% to $621 million in the June quarter, the highest growth rate in the company’s history. Instacart also reportedly turned a profit in the quarter, a rarity among high-growth tech IPOs. Instacart cut its own estimated IPO valuation by nearly 40% back in March, suggesting a new potential value in the $24 billion range. Given Instacart’s impressive growth numbers, the timing of its IPO may have more to do with the health of the overall IPO market than the health of the company.
Potential 2022 IPO valuation: $24 billion.
Discord is a social media and messaging platform that surged in popularity among gamers and cryptocurrency traders during the pandemic. Bloomberg reported in March 2022 that Discord was interviewing investment bankers with an eye on going public, potentially by the end of the year. Discord management was even confident enough about the company’s potential valuation upside to turn down a $12 billion buyout offer from software giant Microsoft Corp. (MSFT) in 2021. Discord raised $500 million at a $14.7 billion valuation in September 2021. However, Fidelity cut its estimated valuation for its Discord stake by 32% in June, suggesting a valuation closer to $10 billion.
Potential 2022 IPO valuation: $10 billion to $15 billion.
Popular social media and messaging platform Reddit filed confidentially for an IPO in 2021, suggesting a high likelihood of a 2022 listing. Reddit even reportedly enlisted the services of Morgan Stanley (MS) and Goldman Sachs Group Inc. (GS) as lead IPO underwriters in January 2022. Reddit’s last round of fundraising in 2021 valued the company at about $10 billion, and the company was reportedly seeking a $15 billion IPO valuation. However, the weak market for tech stocks in 2022 may have significantly hurt Reddit’s market price. Fidelity reportedly cut the estimated value of its Reddit shares by more than a third in April 2022.
Potential 2022 IPO valuation: $10 billion to $15 billion.
Impossible Foods Inc.
Impossible Foods makes plant-based meat products that are carried by Burger King, Starbucks Corp. (SBUX) and other partners. The company’s products are in nearly 25,000 grocery stores and 40,000 restaurants across three continents. Impossible’s most recent fundraising round valued the company at $7 billion in November 2021. However, since that time, publicly traded competitor Beyond Meat Inc. (BYND) has seen its share price plummet roughly 80%, so there’s a good chance the value of Impossible Foods has also dropped significantly. Impossible reported 85% retail revenue growth in 2021, but Beyond Meat’s sales growth dipped into negative territory in the most recent quarter.
Potential 2022 IPO valuation: up to $7 billion.
Klarna Bank AB
Klarna is a Swedish fintech company that provides online financial services, specializing in buy-now, pay-later, or BNPL, services. Klarna was reportedly considering a 2022 IPO at an estimated valuation of $50 billion, but a potential IPO at this point would likely secure a far lower valuation. Shares of BNPL competitor Affirm Holdings Inc. (AFRM) are down nearly 75% year to date. In July, Klarna raised $800 million in funding at a post-money valuation of just $6.7 billion, down from a $45.6 billion valuation in June 2021. Still, Klarna estimates its market capitalization has more than tripled since 2018.
Potential 2022 IPO valuation: $6.7 billion.
10 best upcoming IPOs to watch in 2022:
— Stripe Inc.
— VinFast LLC
— Databricks Inc.
— Mobileye BV
— Chime Financial Inc.
— Instacart Inc.
— Discord Inc.
— Reddit Inc.
— Impossible Foods Inc.
— Klarna Bank AB
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Update 09/19/22: This story was published at an earlier date and has been updated with new information.