Companies That Had Their IPO in 2009: What We Can Learn for 2024

Companies that had their IPO in 2009 were forged in fire. The companies that were able to succeed serve as model IPOs for savvy investors to study for years to come. By studying the companies that had their IPO in 2009, we can gain a better understanding of market psychology. 

We can also gain a better understanding of what may or may not contribute to an IPO’s success. The year 2009 saw a significant drop in IPO activity compared to the pre-crisis boom years. Only 166 companies went public in the US, raising a total of $51.7 billion, compared to 315 companies raising $135.7 billion in 2007.

The backdrop against which these companies initiated their Initial Public Offerings (IPOs) was characterized by the aftermath of the global financial crisis. Despite the challenging economic climate, these entities exhibited resilience and embarked on a path that would redefine their futures.

Today we’ll highlight some of the companies that had their IPO in 2009 to see what we can learn for the 2024 IPO market. 

Companies That Had Their IPO in 2009:

• Duoyuan Global Water (NYSE: DGW)
• Changyou.com (NASDAQ: CYOU)
• Mead Johnson Nutrition (NYSE: MJN)
• Banco Santander Brasil (NYSE: BSBR)

Duoyuan Global Water (NYSE: DGW)

This Chinese water treatment company became a star performer, surging over 124% in its first year. Investors flocked to its promise of providing clean water solutions in a rapidly developing country.

In April of 2011, a report from Muddy Waters LLC was released that exposed Duoyuan Global Water for reporting revenues over 100 times higher than their actual number. The report shed light on numerous unethical practices of the company.

Shortly after the report was released, shares of DGW dropped over 50%. Massive short positions starting to open everywhere. It was the beginning of the end for Duoyuan Global Water. 

Changyou.com (NASDAQ: CYOU)

Another Chinese semi-success story, this online game developer saw its shares jump over 108%. The booming Chinese gaming market fueled its impressive growth. 

Changyou.com was founded in 2001 by Tao Wang and Dewen Chen, with the ambitious vision of becoming a leading developer and operator of online games in China. This aspiration stemmed from their observations of the burgeoning demand for high-quality online gaming experiences in the rapidly developing Chinese market.

Changyou CEO Tao Wang poses in front of the NASDAQ in 2009. Courtesy of Getty images.

On April 17, 2020, Changyou.com announced the completion of a deal to become a private entity again. The merger, known as the “Changyou Merger,” is outlined in the Agreement and Plan of Merger dated January 24, 2020.

The participating entities included Changyou, Sohu.com (Game) Limited (“Sohu Game”), an indirectly wholly-owned subsidiary of Sohu.com Limited (“Sohu”) (NASDAQ: SOHU), and Changyou Merger Co. Limited, a direct wholly-owned subsidiary of Sohu Game. 

Mead Johnson Nutrition (NYSE: MJN)

This established maker of baby food and nutritional products offered investors a haven in a volatile market. Its strong brand and defensive nature led to an 82% stock price increase in its first year. 

Unfortunately, we have a case of another company not even last a decade on the public market. In June of 2017, MJN was acquired by Reckitt Benckiser Group plc. Reckitt was able to purchase Mead Johnson Nutrition with shares valued at just under $90. 

Banco Santander Brasil (NYSE: BSBR)

This Brazilian banking giant raised a record-breaking $8.1 billion in its IPO, making it the largest globally in 2009. Its established presence and strong brand resonated with investors. 

There is good news and bad news regarding BSBR. The good news is that it’s still trading on the New York Stock Exchange. This makes it the only company featured to still trade on public markets. The bad news, however, is that BSBR stock hasn’t treated investors well. 

If you bought the IPO, you’re down roughly 50%. However, if you bought BSBR after the stock market crash of 2020, you’re probably doing okay. Whether or not you were burned by BSBR stock, there is hope for the future. 

In response to the evolving financial landscape, BSBR is actively adopting innovative solutions like fintech partnerships and green finance initiatives. By developing digital technology and online banking platforms, Santander hopes to enhance customer experience and drive revenue.

Final Word on Companies That Had Their IPO in 2009

As you can see, companies that had their IPO in 2009 had a rough go. They chose to go public during financially turbulent times and many paid the price. Not only did three out of four of these companies lose their shirts, but so did their investors. 

One important lesson we can learn from the companies that had their IPO in 2009 is that a company better have rock solid financials before going public. Especially if they’re going public following a market recession. Take a look at the companies that had their IPO in 2018. Market conditions were prime for initial public offerings and those companies took advantage. So what’s next?

2021 and 2022 were very slow years for the IPO market. We started to see a bit more movement on the IPO front in 2023, but nothing substantial. As we head into 2024, analysts and experts are becoming more bullish. 

If companies do decide to go public in 2024, they better be ready to weather any future storms. Before investing in any IPO deal, make sure you understand the company and the financials. Sometimes, such as with Duoyuan, you might even need to be skeptical about the numbers being reported. If you’re not confident in a company’s financials, business strategy, or leadership, then you’re simply speculating, not investing.