Here's how the red-hot IPO market can continue to burn bright

, among a basket of others. Those three stocks trade at relatively high multiples, DocuSign by as much as 197 times forward earnings. However, each has outperformed the market as investors show a willingness to pay higher valuations for expected future growth.

Their future performance is contingent on whether they can deliver on those high expectations, says Smith.way back when — that company overpromised and underdelivered. We need the companies to underpromise and overdeliver, " she explained. Snap tumbled following its early 2017 IPO as worries over subscriber growth and C-suite turnover set investors on edge. From its March debut trading at $24 a share, the stock slumped 80% to bottom out at all-time lows last December."We're talking about technology, new inventions, we're talking about real growth. Even with

, which is a little bit more of a traditional company, it had a pretty high gross rate and [is] the dominant player in online e-commerce for pet supplies, " she said.The IPO Renaissance ETF, which does not yet hold Chewy, has soared 35% this year, more than twice the gain on the S&P 500.

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Race to Public Markets Continues Despite Uber, Lyft FlopsThe IPO market faced its first major test since the disappointing debuts of Uber and Lyft and passed with flying colors. I wouldn't be surprised if the IPO market ramps up significantly in the next few years. We are in an unprecedented era of small tech start-ups and as many of them grow, we'll likely see more and more entrants into the IPO market. Fund lives are running out and VCs eventually have to give cash back to LPs sooo yeah makes sense.
Source: WSJ - 🏆 98. / 63 Read more »