"It could be the best or worst of both worlds," said Rich Peterson, director of global markets intelligence at S&P Capital IQ."In terms of valuation, it could be one thing; in terms of potential, it could be another."

Hot Health-Care IPOs

Well over half of the new companies that have gone public in 2014 have been biotech firmsnearly two dozen, according to analysts at IPO research firm Renaissance Capital.

"This period has been the most active, profitable and highest-volume period we've ever seen for biotech in the last 20 years," said Kathleen Smith, chairwoman and co-founder of Renaissance Capital. "This is quite a wide-open window for biotech."

(Read more: Insurers scope out Obamacare enrollees)

Last year was also a strong period for biotech IPO activity, fueled by positive factors that continue to the drive health-care stocks, including a favorable regulatory environment for firms developing drugs for rare diseases and strong merger activity in the pharmaceutical and biotech sectors. As a result, the sector has outperformed the overall market.

"You have the S&P 500 health-care index up about 7.8 percent," said Peterson. "In terms of institutions, there's probably a demand for biotech and health-care offerings."

Strong returns have also helped drive interest. On average, the biotech IPOs have gained over 50 percent from their offering prices.

But Smith cautions that like Castlight, many of the firms going public have no earnings, and many retain large insider ownership after their debuts.

"Most of them are getting done because the venture capitalists and investors are buying their shares at the time of the IPO," she said. "Investors are looking at it as a sign of commitment, but that means that the float is low."

Excerpt from:

Health-care IT firm Castlight soars 139% after IPO