Arm and Instacart both fell back to their IPO prices, the excitement of the US stock market IPO is not enough.

Over the past two weeks, three companies have conducted highly anticipated IPOs, with mixed results. Investors should approach new stocks with caution.

Goldman Sachs pointed out that the performance of IPO projects in 2020-21 was "poor", with a performance 48 percentage points lower than the Russell 3000 index in the first 12 months after the IPO. The worst performers were companies with a market-to-sales ratio of over 15 times. Among IPOs at this valuation level, none performed well in the first two years, with an average return lagging the market by 84 percentage points.

Arm and Instacart both fell back to their IPO prices

Last week, the IPO price of grocery delivery company Instacart (Maplebear) was $30 per share, with an opening price of $42, but it subsequently began to decline and is currently at $30. Marketing software company Klaviyo also had an IPO price of $30, with the latest price at $33.39.

Meanwhile, earlier this month, Arm Holdings' current stock price hovered around the IPO price, 20% lower than the closing price on the first day.

Therefore, although it is good to see market interest in new stocks, the IPOs of these three companies have hardly generated the excitement that venture capitalists and investment bankers would like to see.

Matt Kennedy, Senior IPO Market Strategist at Renaissance Capital, said, "We know this will be an important milestone in the gradual reopening of the IPO market." Renaissance Capital operates the Renaissance IPO ETF.

Kennedy pointed out that although the pricing of these three deals was at or above the high end of the expected range, the initial investors in these stocks are now facing losses.

Potential IPO projects

The next notable IPO is undoubtedly the low-tech shoe factory Birkenstock, which has a history of nearly 250 years.

Only a few tech companies have recently filed for public IPOs: Vietnamese gaming, information, and digital payment software provider VNG recently submitted an IPO application.

Turo is a car-sharing startup founded in 2010, originally known as RelayRides, and applied for an IPO in January 2022.

BMC Software, a leading enterprise in the mainframe software field, is currently owned by KKR. The company was originally privatized in 2013 for $6.9 billion.

Last year, Ingram Micro secretly submitted an IPO application to the U.S. Securities and Exchange Commission (SEC). In 2016, Ingram was privatized for $6 billion. Unicorn: Service Titan, a business software provider for home and commercial contractors; security software company Rubrik plans to go public in 2023. Another potential competitor is Cohesity, which is Rubrik's rival in data backup and security.

What Silicon Valley really wants to see is an IPO from Databricks, a cloud-based data analytics and artificial intelligence software company. This month, Databricks raised $500 million in a new round of funding, valuing the company at $43 billion; the deal was led by T. Rowe Price and included companies like NVIDIA. This valuation puts Databricks almost on par with competitor Snowflake.

However, so far, these unicorn companies have not filed for an IPO. So, it may take some time.