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Stocks exit the best first quarter in 14 years amid a flurry of IPO activity, a trend that should continue into the second quarter.
The first quarter has seen 40 U.S. initial public offerings as of Thursday, a 29 percent increase over last year, and the highest number in a first quarter since 2007, according to Renaissance Capital data.
But the dollar value of the deals has not been huge — a total $5.5 billion versus last year’s $13 billion, according to Renaissance. Of course, that will change in the second quarter when Facebook comes along in May, with its proposed $5 billion offering. There were 29 IPOs in the fourth quarter, and just 18 in the third quarter.
“I think that there is a big back log of companies that have been waiting to go public. For that to happen, you have to have a market that’s consistently solid. What happened in the September, October time frame last year was there were a lot of deals that canceled due to market conditions,” said Art Hogan of Lazard Capital Partners.
As stock offerings picked up in the first quarter, corporations also tapped the debt market at a record pace. The first quarter has seen the largest amount of non-financial corporate bond issuance ever, totaling $255.5 billion, according to Dealogic.
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