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What We Can Learn From IPO Successes and Failures

NEW YORK (TheStreet) -- The improving health of global markets has brought with it a spate of new stock listings during the past couple of years, which will reach a new pinnacle with the upcoming Alibaba IPO.

The first quarter saw 68 IPOs in Europe, the most since 2007, a sign the increase in IPOs throughout 2013 wasn't a one-off.

TSB, Zoopla Property Group and GoPro (GPRO) are just a few of the other companies to recently list in the U.S. and UK this year, and there's still plenty of opportunity for investors who aren't yet suffering from "IPO fatigue."

>>GoPro's Future Is Foggy Despite Picture-Perfect IPO

However, despite a broadly healthy performance across the markets, the outcome of major recent IPOs has been mixed. Can we learn from some of the bigger successes and flops and apply that to upcoming IPOs?

ING U.S. (Voya Financial)

ING (ING - Get Report), a Dutch financial service provider, floated its U.S. business -- now called Voya Financial (VOYA) -- on the Nasdaq last year. The share price was initially slightly below expectations, and trading closed on its first day at $20.67, above the $19.50 price of the IPO but still below ING's intended level of $21-$24.

A disappointing result for ING has turned into a positive one for the new owners of its stock, which has risen 4.1% for the year to date and 33% for the year to $36.58, as of the Tuesday close. That rise occurred mostly in the first six months of the stock going public; by Nov. 6 (just over six months after the IPO), it had reached a price of $33.60.

It's possible the rebranding to Voya Financial, which was announced alongside the IPO and now implemented, was responsible for the initial faltering of the share price. It may also be blamed on the "unfashionable" nature of the stock. Saga Group, a more recent insurance provider to list in the UK, was also priced below expectations.

It's clear, though, that a profitable business with a secure future can swiftly overcome a blip like an unsure IPO.


Another company with a stock price that hasn't had an entirely easy path to its current high is Facebook (FB - Get Report). After a disappointing listing that valued the company at $105 billion in May 2012, it has seen an impressive 64% rise in value. Its share price ended the first day of trading at $38.20 and closed Tuesday at $68, up nearly 25% for the year to date.

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