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Unprofitable company IPOs are a big zero this year

The Uber banner hangs outside of the New York Stock Exchange in 2019.
The Uber banner hangs outside of the New York Stock Exchange in 2019. Photo: Spencer Platt/Getty Images

After being on pace to beat the overall market earlier this year, Reuters' April Joyner reports that a Reuters analysis finds "[u]nprofitable U.S. companies holding IPOs this year have had a median stock return of 0%."

Between the lines: This is likely because Beyond Meat is now profitable and its 228% stock increase this year is no longer counted among the returns of unprofitable companies.

  • Adding to that, companies like Lyft, Uber, Peloton and Slack have floundered on the public market.
  • Unprofitable IPOs have beaten the market about 47% of the time, according to Bloomberg.

On the other side: Apple shares have surged 62% year-to-date, Microsoft stock is up 41%, and the overall S&P tech sector index has risen 36% YTD.

Go deeper: Saudi Arabia approves IPO of oil giant Aramco

Initial public offerings (IPO)