Late summer is usually a quiet time for investment banking, but this year is different. In fact, markets have remained busy, and IPO activity is much higher than usual for August. As of mid-August, 12 companies have gone public with offerings of at least $50 million each, raising a total of $2.9 billion. That’s nearly double the typical August performance over the past decade, which averaged nine IPOs that raised about $1.5 billion, according to data from Renaissance Capital.
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Avery Marquez, who leads investment strategies at Renaissance Capital, explained that many companies are taking advantage of the strong demand for new stock offerings. Since the IPO market was mostly quiet in recent years, this burst of activity isn’t entirely unexpected. Still, Marquez emphasized that companies wouldn’t be going public now unless investor appetite was strong. One standout example is the crypto exchange Bullish (BLSH), which raised over $1 billion and opened at $90 per share—almost triple its $37 offer price. By the end of its first trading day, the company’s market cap had reached $10 billion, nearly double its IPO valuation.
August is now on track to match July’s strong IPO numbers, when 29 deals raised $5.2 billion, including Figma’s (FIG) historic debut. In addition, with names like Klarna and StubHub expected to go public later this year, the IPO pipeline looks healthy for 2025. Meanwhile, banks like JPMorgan (JPM), Goldman Sachs (GS), Citigroup (C), and Morgan Stanley (MS) all saw higher equity underwriting fees last quarter, and their stocks are up sharply since April. As a result, Morgan Stanley’s CEO, Ted Pick, said this wave of IPOs could be an early sign that investment banking is finally recovering.
Which Bank Stock Is the Better Buy?
Turning to Wall Street, out of the bank stocks mentioned above, analysts think that Citigroup stock has the most room to run. In fact, Citigroup’s average price target of $94.21 per share implies more than 8.2% upside potential. On the other hand, analysts expect the least from Goldman Sachs stock, as its average price target of $727.15 equates to a loss of 0.7%.
