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- The Nasdaq exchange overtook the New York Stock Exchange in year-to-date IPO fundraising last week after colossal debuts from Warner Music Group and ZoomInfo.
- Companies have raised roughly $12.2 billion with Nasdaq IPOs in the year-to-date, The Wall Street Journal reported Monday, besting NYSE’s $10.9 billion in 2020 deals.
- The Nasdaq also has the upper-hand in total deals completed, hosting 44 IPOs to its peer’s 27.
- IPO activity sharply declined in the first quarter as the coronavirus pandemic and heightened market volatility led firms to seek out other fundraising methods.
- IPO activity has since rebounded as markets turn higher and traders grow more optimistic toward economic recovery.
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Newly public firms have raised $12.2 billion in Nasdaq-hosted IPOs in 2020, compared to $10.9 billion at the exchange’s lower-Manhattan peer, The Wall Street Journal reported, citing data from Dealogic. The first week of June yielded a tremendous overtake for the Nasdaq exchange, as Warner Music Group raised more than $1.9 million in the biggest IPO of the year so far.
Overall IPO activity plummeted from its 2019 frenzy as the coronavirus pandemic and recession risks push firms to raise capital elsewhere. Public debuts reached a standstill in late March as markets bottomed and resumed through May as investors revived risk-on attitudes.
The Nasdaq exchange is leading on total deals completed as well, hosting 44 debuts to NYSE’s 27. The latter exchange has hosted only one IPO in June, while the Nasdaq exchange featured Warner Music Group’s along with seven others. ZoomInfo’s June 4 Nasdaq offering took in more than $900 million, making it the seventh-largest IPO of 2020.
The NYSE was also forced to withdraw one of its key draws for companies eyeing an IPO. The closing of its iconic floor kept companies from ringing the trading bell to celebrate their debuts. While virtual ceremonies served as a temporary replacement over the monthslong closure, firms weren’t able to enjoy the fanfare and exposure tied to ringing the market’s opening bell.
The Nasdaq exchange’s new lead, while vulnerable, suggests it could repeat its victory over the NYSE after taking the crown last year. The win was Nasdaq’s first since it botched Facebook’s trading debut in 2012.
The NYSE will also need to sway firms on its lofty fees should it look to retake its throne. Companies listed on the Nasdaq exchange pay a fee as high as $159,000 annually depending on how many shares they issued. The same fees at the NYSE can land as high as $500,000 per year, according to The Journal.
The race is still far from over. The NYSE is slated to host grocery chain Albertsons for its trading debut. The Nasdaq exchange is also set to bring the heat, with IPOs from Vroom and Lantern Pharma scheduled for June 11.
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