Summary:
- Shares of Arm move fractionally lower in today's trading session, after closing up nearly 25% in the company's first day of trading.
- Instacart raises its proposed price range on the back of Arm's public debut, with shares expected to trade on Tuesday.
- Arm's success could be a turning point for the IPO market, unlocking the pipeline for other unicorns waiting to test the market.
Arm's successful public debut has given hope for a potential revival in the IPO market, with Instacart raising its proposed price range on the back of the hype. The surge in tech IPOs is expected to unlock the pipeline for other unicorns waiting to test the market.
Arm's Strong Debut Offers Hope for Instacart IPO
Shares of Arm have dipped slightly in today's trading session, following a strong public debut that saw the stock close up nearly 25%. The success of Arm's IPO has led some analysts to believe that the IPO market could be set for a revival after a muted year. This could be good news for Instacart, which today raised its proposed price range. However, while there is plenty of hype surrounding these two major IPOs, it remains to be seen what they will bring to the public markets, particularly in the tech sector.
Tech Sector Back in Focus
With the tech sector back in focus, there is a lot of interest in Arm and Instacart, as two successful debuts could unlock the pipeline for many unicorns waiting to test the market. The third and fourth quarters of this year will be especially interesting, as the possibility of tech companies making their way into the public markets becomes more likely. Some household names, such as Kava, have already made their way to the public markets earlier this year.
Instacart's Valuation Still Low Compared to Private Funding Round
Instacart's decision to raise its proposed price range comes ahead of its Monday pricing and Tuesday trading. While this move is exciting for those waiting to see what the company will offer to the public markets, it's worth noting that even with the raised price range, Instacart's valuation is still well below the $39 billion it was valued at in its last private funding round. This means that Instacart is facing a down round in the public markets.
Questions Remain About Arm's Future in AI Market
Arm's boost in trading yesterday, up more than 20%, has led some to speculate on the company's potential in the AI market. However, not all analysts are convinced. Needham analyst Charles Shee recently initiated coverage on Arm with a hold rating, citing concerns about the company's valuation being too high and its ability to expand beyond the smartphone market.
Despite these concerns, Arm remains well above its starting trading price from yesterday and will be a company to watch in the coming weeks and months, especially as tech companies continue to make their way to the public markets.