IPOs to Watch in 2016

Trading Initial Public Offerings of various companies can certainly be a profitable activity. While in the past only stock brokers were offering this option, for a few years now some Forex brokers have also been adding CFDs for listed stocks only into their price feed. Why does it make sense to actually watch out for IPO? The reason is rather simple, quite a few technological companies have flipped an IPO within the last few years and it goes without saying that these companies are here to stay. Hence, it is hard to imagine why the share price of such companies would go down, at least over the medium term. Let’s take a look at an example below.

 

On this chart you see Facebook stock price (NASDAQ: FB), it is a company that stores your messages to your friends, your pictures and lots of other information. Facebook advertises. This social network went public on 18^th of May, 2012 with a listing price of $38 per share. Although a few complications resulted in a drop of the share price by nearly 50%, the current price per share has surpassed $100. What is the future for this stock? It may of course fall down slightly, or even crash completely, but the chances for this are rather slim. However, what is for certain is that Facebook will remain the number one social network and continue to grow its user base at least for the next couple of years. A similar trend applies to many technological companies, yet it also has its own exceptions. Stock prices of Twitter have, for example, dropped from $42 per share to around $24. Let’s find out which are the hottest IPOs to watch in 2016 and which are not. 

Most Opportunistic IPOs of 2016

Top1 – Uber

Uber has been in the media headlines around the world this year. The company is expected to go public and it certainly will be one of the most desired CFD at every Forex broker. This is the largest taxi company in the world that, in fact, does not own a single car and its profits have been rising considerably, as is its geographical expansion. On the one hand, Uber is quite a popular app, but it still has a lot of countries to conquer, hence it can be one of the main reasons for stock price growth. On the other hand, as any other disruptor, Uber may face some legal consequences. Nevertheless, an Uber IPO will certainly be the most interesting in 2016.

Top2 – Airbnb

Quite similar to Uber, Airbnb is the largest hotel that does not own a single room, yet it gives access to hundreds of thousands rooms and flats all over the globe. Even though Airbnb profits less, it is a slightly more stable company as it is less influenced by the regulators.

Most Cautious IPOs of 2016

Snapchat

This company can be regarded as a “unicorn”, a company that has received quite some funding and valuation, yet has hardly managed to produce any profit and Snapchat expects to become listed in the forthcoming year. We can easily compare Snapchat to Twitter and see that a lack of a consistent revenue model can be a reason for a stock slump. Although Twitter revenues are stable and consistent, they are just not big enough. For Snapchat the situation is worse. It is certainly not a stock to invest in, although you may try your hand with a Binary broker to go short on it.

Conclusion

The year of 2016 will show quite a few IPOs yet in this article we have covered 3 major ones, Uber and Airbnb are two leaders of the shared economy industry and are expected to grow over short, medium and long term, while Snapchat is a techy company that can flip a successful IPO only by a mix of unexpected factors.