Commentary American finance has seen a powerful march to market. Initial public offerings (IPOs) of formerly private firms surged in 2021 and show signs of sustaining that trend into 2022. Each firm, of course, makes its own decisions about its unique circumstances and products, but the broad picture carries two clear though seemingly contradictory signals. On one side, the overwhelming number of IPOs speaks to business optimism about economic activity and about future profits. On the other side, this IPO surge hints at a belief among managements that stocks today are pricey enough to give listing companies more for their shares than an internal assessment might put their worth. Certainly, firms would not readily list if they thought the reverse were true. It is remarkable in many ways that after the economic harm caused by the COVID lockdowns and quarantines, many IPOs have come to the market. More than 1,000 …
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