IPO green shoots get 2024 party started early
Bankers and investors are optimistic that a string of initial public offerings will cap off a quiet year for new issuance before things accelerate in 2024.
That's the consensus across Wall Street after a flurry of deals on US exchanges positioned September to be the biggest month for IPO fundraising since the market essentially shut in January 2022, according to data compiled by Bloomberg. Even though Arm Holdings Plc and Instacart stumbled in the days following their debuts, their recent stability is giving confidence to firms in the country — and around the world — that have been waiting for their chance.
Companies listing on US exchanges have raised roughly $7.2 billion so far in September, accounting for 56% of the cash raised in global IPOs that priced this month, data compiled by Bloomberg show.
While Arm accounts for nearly $4 of every $10 raised this month, a boost in activity around the world suggests a broad-based thawing of conditions, so long as central banks don't get in the way.
«If a stable rate environment persists then 2023 will bring the establishment of a solid IPO market and 2024 could open the floodgates,» said Rainmaker Securities managing director Greg Martin.
US Reopens
US listings are perking up heading into the final three months of the year. The $21.4 billion raised in 2023 through Wednesday is just a bit less than the amount seen in the same stretch last year, and a growing number of companies plan to test the waters.
It's a stark contrast to earlier this year with volatility staying low as investors get more comfortable that the Federal Reserve's interest rate hiking campaign is nearing its end.
