IPO UNDERPRICING IN THE TECH SECTOR: IMPACT OF THE PROSPECTUS SUMMARY VARIABLES

Abstract

Aiming to provide guidance to researchers regarding publicly available factors associated with tech IPO underpricing, this thesis investigates the impact of the information contained on the prospectus summary on underpricing. In a sample of 131 tech IPOs listed in the U.S. between 2010-2017, was found evidence that IPOs with larger spreads are associated with more underpricing, IPOs with larger gross proceeds and with dual-class shares underprice less and that book-to-market ratio and underwriter reputation do not have significant impact on underpricing. Great majority of the results challenge hypothesis derived upon previous literature. Inherent characteristics of the tech industry, advances on information technology, continuous regulatory changes, increase in regulatory scrutiny and changes on U.S. IPO market trends were proposed and discussed to be drivers of such outcome.