Cramer says the IPO market has been 'hit or miss,' telling investors to stay away from Amer Sports

• Even though the IPO market is heating up, CNBC's Jim Cramer said it's seen some poor offerings, including Amer sports.
• Cramer was wary of the company's balance sheet and the fact that much of its growth comes from sales in China.

Even though the IPO market is heating up, CNBC's Jim Cramer said he thinks it's been "hit or miss" so far. He told investors not to buy Amer Sports, which debuted Thursday at a discount, saying the company has a poor balance sheet.

"So far, this is looking like another out of favor IPO, even if its lowball price allowed the stock to get a like, I guess you could call it a decent pop," he said. "And, I've got to tell you, Amer Sports is a great example of the kind of deals I wish we weren't seeing."

The company is known for a number of popular sports brands, including Wilson and Arc'Teryx. The stock opened at $13.40 a share, bringing its valuation to about $6.3 billion. The company had previously targeted a valuation of up to $8.7 billion. Amer Sports is one of a few recent IPOs whose debuts fell short of Wall Streets' expectations, joined by Birkenstock and BrightSpring Health.

Saddled with $2.1 billion in debt, Amer Sports has a balance sheet that is "less than ideal," according to Cramer. He pointed out that the company's prospectus offered adjusted figures that assumed it would raise $1.6 billion, but its discount meant it was only able to raise $1.37 billion.

Cramer conceded that Amer Sports has seen decent growth over the last few years, but much of that growth came from sales in China. He said that kind of momentum is not repeatable as it's due in large part to lockdowns ending in the country. Cramer added that he's wary of companies with major China exposure due to its struggling economy.

"Honestly, I think the bankers are playing with fire when they try to sell stuff like Amer Sports," he said. "I just hope it doesn't poison the IPO well completely. In other words, underwriters: Just say no."

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