Poshmark Inc.’s stock more than doubled in its trading debut Thursday, reflecting a soaring market for public offerings and expectations that demand for secondhand goods sold online will grow after the economy returns to more normal conditions.
Shares of the online marketplace focused on used merchandise opened at $97.50, according to FactSet, above the company’s initial public offering price of $42. That better-than-targeted IPO price valued the company at more than $3 billion, up from a $1.25 billion valuation in 2019.
Private companies have been looking to cash in on robust demand from investors for new listings. Companies raised more than $167 billion on U.S. exchanges last year through Dec. 24, compared with the full-year record for funds raised through IPOs in 1999, during the dot-com boom, according to Dealogic.
Last month, Airbnb Inc. shares more than doubled in their trading debut, while DoorDash Inc.’s stock surged 86% in the food-delivery company’s offering. Some investors have questioned the valuations that technology companies are commanding, because the high prices suggest that investors are betting on strong growth in the years ahead. Not all newly listed companies have seen their shares jump.
Poshmark enlists consumers to sell all manner of apparel, shoes, beauty items and other merchandise on a digital marketplace. The Redwood City, Calif., company collects a 20% fee for sales of at least $15 and $2.95 for sales lower than that price, and it doesn’t buy inventory.