The Impact of Hype on IPO First-Day Returns : A study of IPOs on the exchanges operated by Nasdaq Stockholm

Sammanfattning: In the last two years, the number of Initial Public Offerings (IPOs) on the exchanges operated by Nasdaq Stockholm have been many. In parallel to this, the newly listed companies’ first-day returns have managed to outperform the market. In the meantime, the IPOs attain much attention that partly consists of general hype and rumors. As of this, it is of interest to investigate the correlation of hype and the first-day returns. This study intends to identify the impact of hype statistically and analyze how the hype can be derived from media’s portraying. The analysis was performed with the help of regression analysis combined with a qualitative case study of media attention with the foundation from behavioral finance. In short, the results of the analysis were statistically insignificant. Thus, it cannot verify that the hype has any impact on the first-day returns. In the meantime, the qualitative case study supports the hypothesis that hype would influence. As a result of this, further studies are necessary to draw clear conclusions concerning the impact of hype.