This year's initial public offerings are performing like it's 1999 — and not in a good way.
Companies going public this year are expected to produce the lowest profits of any year since the Dotcom bubble, according to analysis from Goldman Sachs.
Uber went public in May, and reported a $1.8 billion loss ahead of its public debut. It revealed a $5.2 billion in the second. Uber's ride-hailing rival Lyft, posted a 2018 loss of $900 million ahead of its March IPO. Both stocks are down more than 25% since their IPO date. WeWork would be the second-biggest money-loser in history if and when it goes public.
To be sure, the U.S. stock market trades more than 120% above its level 20 years ago, meaning the equity raised by IPOs in the past year is small on a relative basis. It's on pace to be 0.1% of the S&P 500's market cap, vs. 0.6% during the Tech bubble, Kostin said. "Younger firms grow sales at a faster rate than their more experienced peers," he said. "This trend has contributed to the lower expected sales growth for recent IPOs compared with the Tech bubble."
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