{"id":525288,"date":"2024-03-21T08:12:21","date_gmt":"2024-03-21T08:12:21","guid":{"rendered":"https:\/\/www.finder.com\/uk\/?p=525288"},"modified":"2025-06-26T16:40:20","modified_gmt":"2025-06-26T15:40:20","slug":"the-hot-ipos-that-burnt-their-investors","status":"publish","type":"post","link":"https:\/\/www.finder.com\/uk\/share-trading\/share-trading-research\/the-hot-ipos-that-burnt-their-investors","title":{"rendered":"The hot IPOs that burnt their investors"},"content":{"rendered":"

Everyone wants to invest in \u201cthe next big thing\u201d at the earliest possible moment and for most investors, that means piling in when a stock becomes publicly available through an initial public offering (IPO)<\/a>. The past year has seen more than 1.3 million IPO-related internet searches in the UK alone.<\/p>

Yet, for all the hype surrounding blockbuster IPOs in the UK and the US, there\u2019s a high chance you\u2019ll be facing a loss at some stage, based on new research from Finder. In the worst cases, stocks such as Robinhood<\/a> and Funding Circle<\/a> lost over 70% of their price a year after the IPO.<\/p>

We analysed 24 hyped UK and US IPOs from the last 5 years, and our findings suggest that 1 year or less is an IPO death zone: a week after the IPO, 16\/24 share prices were lower, a month later 19\/24 were lower, and after a year, it was 14\/20 (4 were less than a year old). As we published our article, only 8 out of the 20 that were older than a year had climbed above their initial price.<\/p>

For the 20 IPOs where we have at least 1 year\u2019s worth of data, the declines are rather dramatic. The average IPO share price drop after 1 week was 11.9% (for the 12\/20 that were lower after a week) and a year after the IPO, the 14\/20 stocks that were down had a catastrophic average share price decline of 43.2%. <\/p>

So if you want to increase your odds of being a successful IPO investor, our research suggests you\u2019ll need nerves of steel to hold on throughout the probable volatility. Because even the IPOs that eventually go on to be successful in the long run tend to have a bumpy ride initially.<\/p>

Hyped IPOs that went south: Lyft, Aston Martin, Robinhood and more<\/h3>

To see how the share prices of recent IPOs have performed in the UK and the US over the last 5 years, we picked 2 popular companies from the US and 2 from the UK for each year based on Google Trends data, or if that wasn\u2019t available, we picked the largest IPOs (by money raised).<\/p>

While Spotify (SPOT)<\/a> and Uber (UBER)<\/a> have mostly seen growth since their IPOs (54%+ and 83%+ share price gains at the time of our analysis), these were exceptions out of the 24 companies we checked. <\/p>

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There have been tragedies aplenty. For example, Aston Martin Lagonda (AML)<\/a> and THG Holdings (THG) have both lost over 90% from the IPO share price on the first day of trading to the day we published our analysis in March 2024.<\/p>\n<\/div>\n

Out of all 24 US and UK IPOs we checked in March 2024, the US IPOs came out on top with 6\/12 being positive at today\u2019s share price, compared to an abysmal 2\/12 in the UK. The table below shows 20 IPOs more than a year old and summarises the year-on-year IPO share price change along with the current price. You can see the full version of the table with all 24 IPOs and more prices below<\/a>. <\/p>

Least to most successful IPOs after 1 year<\/h3>

This table shows how the share prices for some of the hottest IPOs from the UK and the US performed \u2013 those with the biggest drops over the first year trading publicly are first.<\/p>

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