US IPO Firms Lag Behind Industry Peers After Day-One Pops Fade

The days of companies making flashy market debuts and then outstripping their peers appear to be over, threatening to dampen enthusiasm for US IPOs poised to hit the market following the Labor Day holiday.

Trivariate Research measured recently-listed companies’ cumulative returns since their second day after their initial public offerings, and compared them to the returns of the top 2,000 companies in their sector. Performance was strong from late April to the end of June, but the measure plunged in July and August, the firm’s latest report shows.

“There’s been derisking as investors monetized big early moves,” said Adam Parker ...