The Nasdaq has overtaken the New York Stock Exchange in initial public offerings this year amid the coronavirus pandemic.
According to financial markets platform Dealogic, companies going public in 2020 have raised $12.2 billion in IPOs at Nasdaq, versus $10.9 billion at the NYSE. (The Wall Street Journal was the first to report the news.) One of the most notable debuts at Nasdaq in the past week was Warner Music Group Corp., which raised upwards of $1.9 billion in the biggest public offering of the year thus far.
Overall, IPO activity took a nosedive in March, when the COVID-19 outbreak took hold in the United States. As of today, more than 1.94 million people in the country have been sickened and at least 110,500 people have died. Several companies’ IPOs — including those of shoe maker Cole Haan and specialty clothier Madewell — have been delayed.
In mid-February, Cole Haan announced plans to raise $100 million in its public offering, with intentions to list on Nasdaq under the ticker “CLHN.” The move was put on pause amid market volatility. On the other hand, J.Crew Group shelved in early March its proposed IPO for Madewell while the brand was in the process of an anticipated split from its parent company. (In its filing with the Securities and Exchange Commission, it said it would trade on either the NYSE or Nasdaq.)
What’s more, as the health crisis escalated, the NYSE’s trading floor shuttered in mid-March, switching to a fully electronic trading system and halting corporate debut celebrations on its historic grounds. It reopened two weeks ago with new safety measures: The area is now outfitted with plexiglass barriers to separate traders, and only a quarter of the usual number of people on the floor are allowed at one time. Masks are also required of the traders, who have been advised to avoid public transportation.
The past few weeks has seen a rebound in the S&P 500, potentially clearing the way for upcoming public offerings. Both the NYSE and Nasdaq collect revenues from companies’ listing fees; the Nasdaq’s fees are capped at $159,000 annually, while a listing on the NYSE costs up to $500,000, depending on companies’ outstanding shares.