The strong run in US initial public offerings has lost momentum due to the government shutdown and increased investor caution, as the Securities and Exchange Commission (SEC) works through a backlog of regulatory filings, according to market participants.Many IPOs expected in late 2025 are likely to be pushed to 2026 as the SEC clears “hundreds of registration statements,” AP reported. Listings that did debut recently have seen limited gains amid concerns that stocks have become expensive following another year of double-digit market returns.“A backlogged SEC, the approaching holiday slowdown, and pressure on AI and other tech stocks are all weighing on hopes for a near-term rebound,” Bill Smith, CEO of Renaissance Capital, said in a note to investors.Despite delays, several IPOs already advanced through the regulatory pipeline are expected to list in November and December.Central Bancompany, which went public after the shutdown, raised $373 million through its IPO on Thursday. November remains on track to be among the slowest IPO months of 2025, Renaissance Capital said.Upcoming large listings could include medical supplies company Medline, potentially raising up to $5 billion in December, while cryptocurrency technology firm BitGo also remains a candidate for a listing next month.Several recent IPOs have lost momentum after strong debutsShares of Figma, which tripled on debut after pricing at $33 per share in July, are now trading slightly above their IPO price. Swedish buy-now-pay-later firm Klarna, priced at $40 in September, is now trading near $29.Cloud services company CoreWeave, listed at $40 in March, jumped initially but has retreated to around $72. Software firm Navan, listed at $25 during the shutdown, is now trading near $15.Broader markets weigh on sentimentThe S&P 500 has fallen 3.5% in November, driven by a slide in technology shares following concerns about valuations tied to artificial-intelligence-linked stocks. However, the index is still up more than 12% this year, while the Nasdaq has gained over 15%.Renaissance Capital’s IPO Index is down about 0.8% this year and has lagged the S&P 500 since mid-October.“What that shows is that investors very quickly monetized, they didn’t want to take the long-term risk,” said Samuel Kerr, head of global equity capital markets at Mergermarket.Investor appetite remains strong despite volatilityAnalysts say high valuations in public markets may continue to push investors toward IPOs as alternative entry points.“Increasingly, as a money manager, you have to find other places to make money and typically, IPOs are that place,” said David Kaufman, partner and co-chair of the corporate & securities practice at Thompson Coburn LLP, AP quoted. “You continue to have all these large mutual funds and money managers with excess cash and no place to put this cash.”Key IPO candidates for 2026 include Databricks, Canva, and Plaid, AP reported.The slowdown masks a surge in behind-the-scenes activity, Kaufman added: “It’s a busy time for lawyers and bankers trying to tee things up for the first and second quarter of next year.”
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