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From Boom to Baseline: A Cross-Sectional Analysis of Nordic IPO Performance

Andersson, Johan LU (2025) NEKN01 20251
Department of Economics
Abstract
This thesis investigates the long-run performance of IPOs in the Nordic region, a topic that remains highly relevant in light of periods of intense IPO activity, such as the Nordic boom in 2021 (S&P Global, 2021). Examining IPOs across the Nordic markets from 2004 to 2024, the study employs Cumulative Abnormal Returns (CAR), Buy-and-Hold Abnormal Returns (BHAR), and cross-sectional regression analysis to evaluate performance over a three-year horizon. It assesses how the firm-specific characteristics: size, age, initial underpricing and market conditions at issuance, influence these outcomes. The findings indicate no systematic long-term underperformance; instead, certain periods exhibit statistically significant overperformance. Size... (More)
This thesis investigates the long-run performance of IPOs in the Nordic region, a topic that remains highly relevant in light of periods of intense IPO activity, such as the Nordic boom in 2021 (S&P Global, 2021). Examining IPOs across the Nordic markets from 2004 to 2024, the study employs Cumulative Abnormal Returns (CAR), Buy-and-Hold Abnormal Returns (BHAR), and cross-sectional regression analysis to evaluate performance over a three-year horizon. It assesses how the firm-specific characteristics: size, age, initial underpricing and market conditions at issuance, influence these outcomes. The findings indicate no systematic long-term underperformance; instead, certain periods exhibit statistically significant overperformance. Size effects highlight superior returns for mid-cap IPOs relative to small- and large-cap firms, while older and more mature firms demonstrate stronger long-run performance compared to younger counterparts. Sector-specific dynamics further reveal varied long-term performance patterns across sectors. Notably, the analysis does not find statistically significant evidence linking "hot market" conditions at issuance to subsequent long-term underperformance. These insights offer valuable perspectives on IPO market dynamics, informing investors, policymakers, and corporate strategists. (Less)
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author
Andersson, Johan LU
supervisor
organization
course
NEKN01 20251
year
type
H1 - Master's Degree (One Year)
subject
keywords
IPO, Long-Term Performance, CAR, BHAR, Nordic Markets
language
English
id
9194684
date added to LUP
2025-09-12 10:06:54
date last changed
2025-09-12 10:06:54
@misc{9194684,
  abstract     = {{This thesis investigates the long-run performance of IPOs in the Nordic region, a topic that remains highly relevant in light of periods of intense IPO activity, such as the Nordic boom in 2021 (S&P Global, 2021). Examining IPOs across the Nordic markets from 2004 to 2024, the study employs Cumulative Abnormal Returns (CAR), Buy-and-Hold Abnormal Returns (BHAR), and cross-sectional regression analysis to evaluate performance over a three-year horizon. It assesses how the firm-specific characteristics: size, age, initial underpricing and market conditions at issuance, influence these outcomes. The findings indicate no systematic long-term underperformance; instead, certain periods exhibit statistically significant overperformance. Size effects highlight superior returns for mid-cap IPOs relative to small- and large-cap firms, while older and more mature firms demonstrate stronger long-run performance compared to younger counterparts. Sector-specific dynamics further reveal varied long-term performance patterns across sectors. Notably, the analysis does not find statistically significant evidence linking "hot market" conditions at issuance to subsequent long-term underperformance. These insights offer valuable perspectives on IPO market dynamics, informing investors, policymakers, and corporate strategists.}},
  author       = {{Andersson, Johan}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{From Boom to Baseline: A Cross-Sectional Analysis of Nordic IPO Performance}},
  year         = {{2025}},
}