OpenAI, Anthropic IPOs Could Spark a Selloff in These Struggling Stocks — IBM, Tesla, AppLovin Among Names at Risk

The upcoming initial public offerings (IPOs) of OpenAI and Anthropic may exacerbate the woes of already struggling stocks post-Labor Day, said strategists at Evercore ISI, spearheaded by Julian Emanuel.

Evercore sees further upside for AI stocks but warns that upcoming IPOs and seasonal tax-loss selling could accelerate the unloading of weaker AI-related stocks. The strategists at Evercore elucidated that investors may “make room” for these IPOs in their portfolios by reducing existing holdings, MarketWatch reported on Monday.

This trend is particularly relevant in the post-Labor Day market, with the mutual fund tax-loss selling season approaching in October. As this season nears, investors may sell underperforming stocks to realize losses, offset capital gains and lower tax bills. They could then redirect those proceeds toward anticipated blockbuster AI IPOs such as OpenAI and Anthropic, increasing pressure on weak performers.

Anticipating this portfolio shift, Evercore…