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US-listed IPO issuance - YTD comparisons

Stock indices have reached record highs this year, and US-listed IPOs have made a comeback, led by technology.

A record year for stocks

2017 is the best year for US-listed IPO volume and activity since $92.9bn raised in full-year 2014 via 292 IPOs. With only a month of the year remaining, issuance on the US exchanges total $47.8bn via 179 IPOs. Strong aftermarket performance from IPOs in 2016 has continued its momentum throughout this year, further reassuring investors. Stock-market indices have reached record highs, and the VIX averaged around 12% in the last 52 weeks.

By sector, enthusiasm has been high for stocks from industrials, due to factors such as accelerated growth, planned infrastructure spending and tax cuts by the government, and an increase in oil prices.

IPO comeback led by technology

Following one of the worst years in a decade for technology IPOs, optimism has returned to the sector in 2017. While the $3.7bn raised via 22 IPOs on US exchanges in 2016 was the lowest YTD volume since 2008, 34 technology companies have already gone public in 2017, raising $12.0bn. This marks the highest volume in 3 years and returns tech as the top sector for US-listed IPO volume. Snap’s $3.9bn IPO in March is the largest IPO of 2017 on US exchanges, and the largest tech listing on a US exchange since Alibaba in September 2014 ($25.0bn).

Finance ranks second by volume with $11.4bn via 47 IPOs, making it the most active sector this YTD. Finance activity was led by 33 SPAC IPOs, representing the highest activity since full-year 2007.

What’s next?

This month 7 IPOs are expected to raise $729m, with 4 from healthcare issuers and 2 from the finance sector, of which only 1 IPO is slated to list on the NYSE. Despite NYSE’s strong start to the year for IPO activity, the NASDAQ surpassed it in July and leads with 103 new listings in 2017 YTD compared to 75 IPOs on the NYSE.

Excluding the listings expected in December, 33 IPOs are in the current pipeline for US exchanges. The momentum of US-listed IPOs is expected to continue into 2018, slated to raise up to $3.5bn. Healthcare and real estate are leading the sectors, with 6 IPOs each.

Written by Domenico Positano, Dealogic Research


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Data source: Dealogic, Yahoo! Finance (stock indices), as of November 30, 2017