Page 25 - DIY Investor Magazine | Issue 34

Ecommerce may quickly lose its lustre if consumers need to pay a premium for buying online.
THE IPO MARKET
2021 was still a fruitful year for technology IPOs, with plenty of demand from investors matched with a good stream of opportunities. However, it has been a difficult time in stock markets and particularly for the technology sector. Has the malaise in public markets had an impact on private markets?
Certainly, we see that valuations in private markets haven’t always adjusted to the new reality in public markets.
Deal activity has slowed, with EY reporting Q1 2022 global IPO volumes down 37% year on year5, with particular weakness
in the US. There was a considerable fall in cross-border, unicorn (companies that reach a valuation of $1 billion without being listed on the stock market) and SPAC (Special Purpose Acquisition Company) IPOs.
SILICON VALLEY BYTE SIZE - THE ALLIANZ TECHNOLOGY TRUST PODCAST: MOMENTOUS EVENTS
In 2022 the world has seen significant economic and geopolitical events. How might this impact the technology sector, both in the short- but also the longer-term? In this latest podcast, the team ponder the balance of short-term headwinds with continuing long-term growth themes. Click to hear the podcast:
There may be some residual adjustment needed to valuations in the private market. However, it is worth noting another trend that has emerged as public market valuations have weakened. Private companies have been looking at the valuations in public markets and spotting some bargains. Bravo buying Sail Point, for example.
There is a lot of money in private equity and it’s getting to a point where the mid-sized companies look very attractive. This may help provide some support to public market valuations in the coming months.
1 https://www.bbc.co.uk/news/business-61153252
2 https://www.theverge.com/2021/3/3/22311418/netflix-tiktok-clips-funny-movies-tv- shows-streaming-big-mouth-seinfeld
3 https://fortune.com/2022/02/03/amazon-q4-2021-earnings-ad-business-shares- skyrocketing/
4 https://www.investing.com/analysis/big-week-for-tech-part-ii-200622786
5 https://www.ey.com/en_gl/news/2022/03/global-ipo-market-experiences- significant-slowdown-in-q1-2022
BYTE SIZE TAKEAWAY: HAS THE CURRENT WAR INCREASED THE EMPHASIS ON CYBERSECURITY?
All sources Allianz Global Investors GmbH unless otherwise noted. This is no recommendation or solicitation to buy or sell any particular security.
A security mentioned as example above will not necessarily be comprised in the portfolio by the time this document is disclosed or at any other subsequent date. Investing involves risk. The value of an investment and the income from it may fall as well as rise and investors may not get back the full amount invested. Past performance is not a reliable indicator of future results. The views and opinions expressed herein, which are subject to change without notice, are those of the issuer and/or its affiliated companies at the time of publication.
This is a marketing communication issued by Allianz Global Investors GmbH, an investment company with limited liability, incorporated in Germany, with its registered office at Bockenheimer Landstrasse 42-44, D 60323 Frankfurt/M, registered with the local court Frankfurt/M under HRB 9340, authorised by Bundesanstalt fr Finanzdienstleistungsaufsicht (www.bafin.de). Allianz Global Investors GmbH has established a branch in the United Kingdom, Allianz Global Investors GmbH, UK branch, 199 Bishopsgate, London, EC2M 3TY, www.allianzglobalinvestors.co.uk, deemed authorised and regulated by the Financial Conduct Authority. Details of the Temporary Permissions Regime, which allows EEA-based firms to operate in the UK for a limited period while seeking full authorisation, are available on the Financial Conduct Authorityís website (www.fca.org.uk). Details about the extent of our regulation by the Financial Conduct Authority are available from us on request.
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DIY Investor Magazine · July 2022