Exchange operator Nasdaq is on track to beat the New York Stock Exchange on listings for the sixth straight year in 2024, as Wall Street looks for a bumper crop of initial public offerings in 2025.
Companies raised approximately $22 billion across 160 initial public offerings at Nasdaq in the first 11 months of this year, outpacing the nearly $17 billion in 34 listings for NYSE, according to data provided by Dealogic and Nasdaq.
This was the highest listings volume in three years. Market watchers took it as another hopeful sign for IPO volume, which has slumped in recent years after the Federal Reserve ramped up interest rates in 2022 to stem surging inflation. This also raised the cost of capital for companies.
Many believe the IPO pickup will extend into 2025, when investors expect President-elect Donald Trump to enact policies including deregulation that could put a charge into deals.
“We do think that conditions are right for a very robust IPO market starting in the new year,” said Jeff Thomas, global head of listings at Nasdaq, in an interview with Reuters. “We're very actively pitching companies that are talking about accessing the public markets in either Q1 or Q2.”
The two New York exchanges have competed fiercely for new listings which generate annual fees. Both remain attractive listing destinations for global companies.
Strong U.S. stock performance has bolstered investor confidence. The S&P 500 is up nearly 27% this year, while the Nasdaq Composite has gained almost 33%.
Among the companies debuting on Nasdaq this year were cold storage real estate investment trust Lineage, the largest IPO in 2024, healthcare payments company Waystar and chip maker Astera Labs.
Nasdaq's listings included 44 special purpose acquisition company IPOs, which Thomas said is back to historical norms. The exchange also snatched notable listing transfers such as Palantir Technologies and the soup company Campbell from the NYSE.
NYSE executives, for their part, said the comparison was one of quantity over quality.
"We don't measure success by the number of deals we execute. We measure it by the quality of our community," said Michael Harris, vice chairman and global head of capital markets at NYSE.
NYSE said 62% of Nasdaq IPOs in 2024 did not qualify to list on its exchange, and that it added more than $400 billion in market capitalization to include IPOs, spinoffs and transfers.
In the first half of the year, the Intercontinental Exchange-owned NYSE listed seven of the 10 largest U.S. transactions as wins, such as Rubrik, a cybersecurity firm backed by Microsoft, Viking Holdings and Amer Sports.
Still, with both active and passive investment capital rushing to Nasdaq-listed stocks and exchange-traded funds, IPO issuers are favoring Nasdaq over the NYSE, said Samuel Kerr, head of equity capital markets at Ion Analytics.
"With investors continuing to buy into the AI revolution through Nasdaq-listed firms like Nvidia and companies like Peter Thiel's Palantir shifting their listings to the exchange from NYSE, we will continue to see more IPO issuers try to ride this rising tide," Kerr added.
Most forecasts for a strong year depend on U.S. interest rates falling further and the economy remaining resilient. Several months of stalled progress on inflation have stirred doubts over how far and how fast the Fed will be able to cut rates in 2025.
And while U.S. growth remains strong, Trump’s pledges to enact tariffs on U.S. trading partners is seen as a potential threat to the economy in 2025, especially if other countries respond with retaliatory measures.
For now, however, optimism remains high.
The Nasdaq IPO Pulse Index, which forecasts the direction of U.S. IPO activity over the next six months, hit a more than three-year high in October, indicating IPO activity is looking up in early 2025, according to the exchange.
“There is a lot of pent up demand that gets pushed to 2025,” said Owen Lau, senior analyst at Oppenheimer & Co. “It should be a big year for IPOs.”