Instacart's stock languishes below its IPO price two months after debut

By Ciara Linnane

The grocery-delivery app is only one of four recent IPOs that's still trading below its issue price.

Instacart is the only stock of four recent initial public offerings that is still languishing below its issue price some two months after its debut.

The grocery-delivery app, which trades as Maplebear (CART), was last quoted at $26.12, below its $30 IPO issue price last September.

The stock of the iconic German sandal-maker Birkenstock Holding PLC (BIRK) climbed above its $46 issue price on Wednesday for the first time since its Oct. 11 debut.

Digital ad company Klaviyo (KVYO) was up 6% at $32.04, above its $30 issue price set in September, while Arm Holdings Plc (ARM), which also went public in September, was trading at $62.72, above its $51 issue price.

The overall IPO market has been lackluster most of this year, but it has been particularly soft for the past several weeks as deal after deal failed to sparkle.

Arm, Instacart and Klaviyo all enjoyed first-day gains, but then slumped in the aftermarket.

The market is unlikely to be lifted out of the doldrums until new issues start to climb above their IPO prices and investors start to make money again, Ross Carmel, partner at Sichenzia Ross Ference Carmel LLP (SRFC), a securities law firm with practice around public and private offerings, told MarketWatch last week.

On a brighter note, the IPO pipeline has seen some recent additions of profitable and decent-sized companies.

UL Solutions Inc., a testing, inspection and certification company serving customers worldwide, filed earlier in November to list on the New York Stock Exchange.

No terms have been disclosed as yet, but Goldman Sachs and JP Morgan are leading a team of 11 banks underwriting the deal, suggesting it will be sizable.

Smith Douglas Homes Corp., a Woodstock, Ga., home builder that lists former Agriculture Secretary and Georgia Gov. George E. "Sonny" Perdue III as a shareholder, also plans to go public on the NYSE under the symbol "SDHC," according to a filing.

In all, 103 IPOs have priced this year so far, up 47% from 2022, according to Renaissance Capital, a provider of IPO exchange-traded funds and institutional research; but that's well below the number seen in frothier times.

In 2021, for example, there were 397 deals.

Total proceeds stand at $19.3 billion, up 151% from a year ago, but well below the $142.4 billion raised in 2021.

The Renaissance IPO ETF IPO has gained 38% year-to-date, while the S&P 500 SPX has gained 19%.

See now: Birkenstock IPO: 5 things to know about the iconic German sandal maker

-Ciara Linnane

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11-29-23 1430ET

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