2019 IPOs to watch: Ten highly anticipated new issues.
Overconfidence and Wall Street don't mix. But as the ball dropped and the year of 2019 began, even cautious investors knew one thing: 2019's upcoming initial public offerings would include a ton of high profile young companies that don't come around too often. Many, like Uber, Lyft, WeWork and Pinterest, were worth more than $10 billion. With only two-thirds of the year complete, it's crystal clear that 2019 is shaping up to be the blockbuster year for IPOs everyone expected. Plenty of headline-grabbing surprises, disappointments, unforeseen winners and everything in between grace this list of 2019's 10 most anticipated and upcoming IPOs, for better or worse.
Slack (ticker: WORK)
Slack was always one of the hottest upcoming IPOs of 2019. The popular workplace messaging service openly planned its IPO since 2018, finally going public via a direct listing in June. While direct listings reduce Wall Street fees, it also means insiders, investors and employees sell shares to the public, while Slack itself didn't get any juicy IPO proceeds to reinvest in its business. Revenue grew 65% to roughly $134 million in the first quarter, while losses grew 50% to about $39 million. Money-losing tech companies, it seems, just love going public. Recently, shares plummeted after Slack forecast -- in its first earnings report as a public company -- higher losses in the current quarter than analysts expected.
Final 2019 IPO valuation: $23 billion
One of the few upcoming IPOs in 2019 expected to join Slack by listing directly is home rental platform Airbnb. This makes more sense for Airbnb than for Slack, however, since Airbnb is regularly profitable on an EBITDA (earnings before interest, taxes depreciation and amortization) basis. The hard work building a profitable, sustainable business is over, and Airbnb's powerful network effect and brand have cemented it as the leading global marketplace for renters and leasers. Airbnb already reportedly boasts quarterly revenue above $1 billion and may still be growing 30% annually. It's currently worth more than both Hilton Hotels (HLT) and Expedia (EXPE). While it's still not too late for a 2019 Airbnb IPO, hoards of private venture money allows the company to bide its time if it pleases.
Potential 2019 IPO valuation: $38 billion
Enter Peloton, the trendy maker of expensive stationary bikes and treadmills with built-in screens connecting users to streaming fitness classes. After filing to go public in late August, shares could debut as soon as September under the ticker PTON. The premium fitness retailer is apparently able to convince enough consumers to pay $2,000 for a connected stationary bike, $40 monthly for streaming classes and up to $4,000 for a connected treadmill. Revenue more than doubled to over $900 million last fiscal year. It also lost more than $250 million on those sales.
Potential 2019 IPO valuation: $7 billion to $10 billion
The no-fee trading platform Robinhood, which surpassed E-Trade (ETFC) in user count in 2018 only five years after forming, now has more than 5 million accounts. Robinhood is definitely mulling an IPO. The service revolutionized trading and is a favorite among millennials, earning its money from interest on account balances, margin trading and selling order flow to stock exchanges. Its latest funding round raised $323 million and gave Robinhood a $7.6 billion valuation. In November, Robinhood hired Amazon's (AMZN) vice president of finance Jason Warnick as its chief financial officer, making Robinhood one of the biggest IPOs to watch in 2019.
Potential 2019 IPO valuation: $7.6 billion
Like many of the aforementioned tech "unicorns" on this IPO list, food delivery app Postmates began exploring the process of going public in fall 2018, consulting several banks about the underwriting process. Postmates' most recent round of funding fetched a $1.85 billion valuation, making it one of the smaller companies on this list. Despite intense competition from GrubHub (GRUB), UberEats, DoorDash and others -- and even considering Uber's underwhelming IPO day -- Postmates may want to go public before the bull market fizzles out. The company filed confidentially for an IPO in February, but Postmates reportedly plans to publicly reveal its S-1 in September, which would put it on track to go public before the end of 2019.
Potential 2019 IPO valuation: $1.85 billion
The We Company (rebranded from WeWork)
After filing to go public in late April, the shared office space startup formerly known as WeWork remains one of the most exciting upcoming IPOs to watch in 2019. The rapidly expanding real estate company, which leases space in its sleek, open locations to small, medium and large businesses as well as freelancers and remote workers, more than doubled its revenue to $1.8 billion in 2018. Unfortunately, losses more than doubled too, reaching $1.9 billion. Set to debut with the ticker WE as soon as September, it's starting to look like The We Company missed its perfect window to go public; it last raised money from private investors at a $47 billion valuation, but recent CNBC reports claim WeWork has practically slashed its valuation in half to entice institutional investors in its upcoming IPO.
Potential 2019 IPO valuation: $25 billion
Lyft hasn't just been racing Uber to adopt self driving cars, drive down labor costs and break even; the last year's been a win-at-all costs race to tap the public coffers before its biggest rival. Lyft won that battle, going public on March 29 at the IPO price of $72 a share. The ride hailing company raised over $2.3 billion at a $24 billion valuation and shares finished their first day 9% higher. Since then, it's all been downhill, falling over 40% in its first six weeks of trading. In just over five months, Lyft is down almost 50%; over $10 billion has been shaved off Lyft's IPO market capitalization in that time.
Final 2019 IPO valuation: $24.3 billion
By late 2018, rumors were swirling that Pinterest was nearing an IPO, perhaps even in the first quarter. The image search and sharing app didn't make that deadline, but it went public at the end of April at $19 per share, or a $10 billion valuation. The wait was worth it: Its debut trading day on the New York Stock Exchange saw shares close 28% above the IPO price. While some irrational exuberance drove shares as high as $35 in the days that followed, even after coming down to earth, PINS stock trades well above its IPO price. PINS investors bid shares higher after an August earnings report revealed Pinterest had reached 300 million users and revenue jumped 62% in the quarter.
Final 2019 IPO valuation: $10 billion
Beyond Meat (BYND)
In what has undoubtedly gone down as the most exciting IPO of 2019, this El Segundo, California-company founded in 2009 took Wall Street by storm when it went public on May 2. The unassuming food company, which makes "plant based meats" that imitate popular meat products, raised about $240 million at $25 per share, or a $1.5 billion valuation. Investors couldn't get enough of the stock though, and shares rocketed 163% higher on the first day of trading. Its premier product is the Beyond Burger, which sells at places like Whole Foods and TGI Fridays, to name a couple. Four months after going public, BYND still looks like 2019's hottest IPO. In fact, it's only gottent hotter: by early September, shares traded above $160 and the company was worth nearly $10 billion.
Final 2019 IPO valuation: $1.5 billion
Although Beyond Meat is the best IPO of 2019 to date, global ride-hailing giant Uber was easily the most anticipated upcoming IPO. Former Expedia Group CEO Dara Khosrowshahi was hired in 2017 to replace founder Travis Kalanick as the CEO amid a torrent of scandals. Years later, public relations issues still abound, including a driver strike days before Uber's IPO. The offering once thought to fetch a $120 billion valuation went public at $45 per share, with an $82.4 billion valuation. Even then, it fell 7.6% on day one and 10% the next day. The unprofitable ride hailing company raised $8.1 billion. By early September Uber was trading in the low $30s, within 6% of all-time lows. The road to a $120 billion valuation looks much tougher with a $54 billion market cap.
Final 2019 IPO valuation: $82.4 billion
These could be the biggest IPOs of 2019.
-- The We Company
-- Slack (WORK)
-- Lyft (LYFT)
-- Pinterest (PINS)
-- Beyond Meat (BYND)
-- Uber (UBER)
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