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IPOs Rebound in 2020: ETFs to Play

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  • (0:45) - 2019 IPO Performance Overview
  • (4:15) - What To Expect From IPOs In 2020
  • (9:30) - Will Airbnb Use A Direct Listing?
  • (16:00) - Is Casper A Good IPO Investment?
  • (19:25) - Understanding Virgin Galactic’s IPO
  • (25:15) - Renaissance IPO ETF: IPO
  • (30:10) - Breaking Down Beyond Meat and Lyft
  • (34:00) - Episode Roundup: Podcast@Zacks.com

In this episode of ETF Spotlight, I speak with Kathleen Smith, chairman and co-founder of Renaissance Capital, a global IPO investment advisory firm.

2019 was expected to be one of the best years for IPOs but some of the most high profile offerings, including Uber (UBER - Free Report) and Lyft (LYFT - Free Report) , disappointed investors. It seems private money was chasing growth at all costs.

Things are starting to turn around for many of these companies. Uber has gained 36% this year, Beyond Meat (BYND - Free Report) and Zoom (ZM - Free Report) are up more than 50%. What lies ahead?

Shares of Casper Sleep (CSPR - Free Report) , one of the most high profile IPOs so far this year, surged 13% on their first day of trading and then plunged.  They are still trading below the IPO price, suggesting that public market investors have little interest in loss making companies.

Virgin Galactic (SPCE - Free Report) , which has soared over 200% this year, took a different route to go public. It merged with Social Capital Hedosophia Holdings, a special purpose acquisition companies or SPAC.

Which IPOs should investors watch in 2020?

The Renaissance IPO ETF (IPO - Free Report) provides diversified exposure to newly public companies before they join other core US equity indexes. Major indexes usually include newly public companies only after a “seasoning” period. For example, Facebook (FB - Free Report) was included in the S&P 500 index about two years after going public.

IPO’s top holdings include Uber, DocuSign (DOCU - Free Report) and Spotify (SPOT - Free Report) . It has gained about 11% this year.

The Renaissance International IPO ETF (IPOS - Free Report) holds recently listed international IPOs. Please visit Renaissance Capital to learn more about IPOs and these ETFs. If you have any comments or questions, please email podcast@zacks.com.

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