Is the Surge in US IPOs a Warning Sign for Investors? – Goldman Sachs Exchanges

Is the Surge in US IPOs a Warning Sign for Investors? – Goldman Sachs Exchanges

Market views

Bullish

EQUITIES— US equity market has deep capacity to absorb IPO supply with $600B in dividends and ~$1T in buybacks annually providing recycling capacity. Current issuance levels are manageable relative to market size.
TECH— Tech companies issuing debt while repurchasing equity signals equity is underpriced relative to debt. Magnificent Seven debt issuance paired with buybacks is positive for equity holders.

Bearish

IPO— IPOs historically underperform market over first 1-3 years after listing, especially during IPO waves when unprofitable companies come to market. Better to wait before buying.

Not investment advice.