2024 continues to spotlight a growing number of new publicly traded companies, with some high-profile names making the list of up-and-comers in the year’s second half.
In the U.S., 80 new initial public offerings rolled out from January through June, hauling in $17.8 billion in proceeds, according to EY’s Global IPO Trends Q2 2024. The increase in IPOs hit 27%, and the amount of IPO proceeds rose 75% year over year. There was also a leap in private equity and venture capital-backed IPO proceeds globally, but in the U.S. it was most pronounced, at 74%.
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Moreover, the IPOs that entered the public trading sphere took flight, with the average “day one” trading price rising 16%. While overall 2024 IPO stock performance has been lower compared with the S&P 500’s 16% gain as of early September, IPOs are building up steam heading into the last few months of the year, with select performers leading the way.
According to KPMG, 232 companies were in the IPO pipeline at the end of the second quarter. But which new IPO names carry the biggest buzz on Wall Street? Research these recent and upcoming IPOs to see if they make sense for your investment portfolio:
| Recent/Upcoming IPO | IPO valuation* |
| Lineage Inc. (ticker: LINE) | $18 billion |
| Tempus AI Inc. (TEM) | $6.4 billion |
| Astera Labs Inc. (ALAB) | $5.5 billion |
| Reddit Inc. (RDDT) | $6.5 billion |
| Ibotta Inc. (IBTA) | $2.7 billion |
| StubHub | $16.5 billion |
| Stripe | $65 billion to $70 billion |
*Valuations for StubHub and Stripe are estimates.
Lineage Inc. (LINE)
IPO valuation: $18 billion
Most investors likely never considered adding a company specializing in temperature-controlled warehouse real estate investment trusts (REITs) to their portfolio, until Lineage came along. In late July, the company raised an eye-opening $4.4 billion for its new IPO, listing 57 million shares at $78 apiece. That led to LINE holding an $18 billion valuation, making it the largest new public offering since semiconductor manufacturer Arm Holdings PLC (ARM) raised $4.8 billion in its 2023 IPO.
The Michigan-based company has claimed a significant share of the temperature-controlled warehouse market, wheeling and dealing its way to 480 cold-storage facilities in the U.S., Europe and Asia.
The stock traded up moderately at $82 per share in the first week of September, but multiple analysts have rolled out positive coverage calls on it. J.P. Morgan placed an “overweight” rating on the stock with a $93 one-year target price. Truist analysts shared that sentiment, slapping a “buy” call on LINE with a $94 target price. Clearly, Wall Street likes what it sees in one of the larger IPOs of the year.
Tempus AI Inc. (TEM)
IPO valuation: $6.4 billion
Tempus is a genomic testing and data analysis firm started by Groupon co-founder Eric Lefkofsky in 2015. This artificial intelligence-driven stock launched in June with an original price of $37 per share and soon caught the attention of Ark Investment Management’s Cathie Wood, one of the biggest traders on Wall Street.
In August, when TEM temporarily dipped in price by about 15%, Ark snapped up $1.5 million worth of TEM shares. So far, Wood’s bet is a smart one, as TEM shares have risen roughly 40% since the IPO. The stock rose by 15% on its first day of trading and has been trending upward ever since.
A fresh catalyst came on Sept. 4, when the company announced a multiyear data collaboration with BioNTech SE (BNTX) to support BioNTech’s cancer therapy development.
Analysts are backing Tempus, with big names like J.P. Morgan, Morgan Stanley and Stifel recently issuing early “buy” calls on the company. TD Cowen has also weighed in with a “buy” on TEM, with a target price of $50 per share.
Astera Labs Inc. (ALAB)
IPO valuation: $5.5 billion
Astera Labs has percolated since its March 19 IPO date, with its stock rising from $36 on day one of public trading to $39.11 as of Sept. 3.
The Santa Clara, California-based company specializes in AI and cloud infrastructure connectivity solutions.
ALAB’s Q2 numbers were borderline outstanding, with revenues rising 18% from Q1 2024 and up a whopping 619% year over year. Analysts have taken notice, with Jefferies’ Blayne Curtis including ALAB in his “basket” of high-performing AI stocks, with an $85 price target.
Other analysts’ expectations are rising, with J.P. Morgan’s Harlan Sur issuing a “buy” rating on the stock in August, with a $70 price target. Research firm Craig-Hallum held its “buy” call on Astera, with a $75 price target.
Reddit Inc. (RDDT)
IPO valuation: $6.5 billion
Reddit is a clear-cut winner in the 2024 IPO sweepstakes, as its share price ($34 on IPO day) has risen 69% since trading opened on the stock in late March 2024.
The company recently survived a brief usage blackout, and there are strong rumors of paywall fees for select “subreddits.” Reddit CEO Steve Huffman launched that rumor on an early August earnings call with analysts: “I think the existing altruistic free version of Reddit will continue to exist and grow and thrive just the way it has, but now we will unlock the door for new use cases, new types of subreddits that can be built that may have exclusive content or private areas, things of that nature.” Reddit users are notoriously possessive of the platform’s free social media experience, and Huffman has said no more about the topic since the earnings call.
Meanwhile, Reddit has largely beaten Q2 analyst estimates. Wall Street seems excited for Reddit’s prospects, especially with the treasure trove of user data the company controls and its growing “A-plus” content partner list. That includes Alphabet Inc. (GOOG, GOOGL), Open AI , the National Football League, and possibly Microsoft Corp. (MSFT) and Meta Platforms Inc.’s (META) Facebook added to the list down the road.
As of August, 14 of the 15 FactSet analysts who track Reddit’s stock had either an “overweight” or “hold” call on RDDT.
Ibotta Inc. (IBTA)
IPO valuation: $2.7 billion
Ibotta launched out of the gate with an $88-per-share price tag in its mid-April IPO, but it has fallen to $54.05 per share as of Sept. 3. The consumer goods packaging technology company faces questions from investors after a poor Q2 earnings report, in which Ibotta reported losses in key areas like direct-to-consumer redemptions, direct-to-consumer redeemers, and total redemptions per redeemer, all areas the company claimed to be closely tracking when it released its IPO documents.
The company announced quarterly net losses of $33.9 million against a gain of $15.3 million in the comparable period of 2023, and indicated its operations expenses had basically doubled. That information spooked investors, who began shedding IBTA shares in mid-August, causing the stock to drop 48% from its IPO price.
Now numerous law firms are circling Ibotta, looking for aggrieved shareholders for potential legal action, which isn’t good news for any publicly traded company. Ibotta has tried to restore confidence in the stock with an Aug. 22 announcement of a $100 million share buyback program.
StubHub
IPO valuation: $16.5 billion
StubHub leads the list of promising IPOs that have yet to go the publicly traded route but are tantalizingly close.
That date looks like it’s drawing nearer, as the Wall Street Journal reports that the event-ticketing giant is targeting an IPO date in September at the earliest. While StubHub has already filed the necessary IPO paperwork with the U.S. Securities and Exchange Commission, it’s reportedly biding its time on a public offering due to volatile stock market and IPO market conditions.
When the time comes, StubHub could be one of the bigger IPO stories in 2024, given its prime position in the $8 billion resale ticket market. StubHub has no inventory, and it profits when big concerts and sporting events sell high-demand tickets.
On the downside, StubHub has a huge $2 billion debt load and is currently enmeshed in legal troubles over so-called ticket-related junk fees. Additionally, sector competitors like Seat Geek and Live Nation are gaining ground fast.
Even so, when StubHub goes public, its business model and industry status should appeal to retail and institutional investors, but perhaps at a lower valuation rate than current estimates.
Stripe
IPO valuation: $65 billion to $70 billion
San Francisco-based Stripe is edging closer to an IPO. However, its recent financial moves suggest the digital payment provider is positioning itself for a valuation higher than the reported $65 billion that’s been on the table for most of 2024.
The company has already finished a private stock sale that raised $694 million, amid reports of a share buyback deal via a new tender offer.
Stripe also made news after Sequoia Capital reportedly offered to purchase 861 million Stripe shares at a share price of $27.51 each, pushing Stripe’s potential valuation closer to $70 billion. Helping stoke the valuation fire is Stripe’s reported $615 million in free cash flow in the second quarter of 2024, which should help attract even more investors.
Earlier this year, Stripe noted in its annual letter that the 15-year-old company cleared $1 trillion in total payment volume in 2023, up 25% from 2022.
All in all, that sounds like a company looking for capital growth, and an IPO would be a great way to provide that. With major customers like OpenAI and Anthropic using its digital payment technology, Stripe remains one of the favorite horses in the 2024 IPO derby. It’s just a matter of getting out of the gate now.
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7 Recent and Upcoming IPOs in 2024 originally appeared on usnews.com
Update 09/04/24: This story was previously published at an earlier date and has been updated with new information.
