Nasdaq to Rectify IPO Hiccups - Analyst Blog


Following the problems encountered during the recent initial public offering (IPO) of Facebook Inc. ( FB ) last Friday, Nasdaq OMX Group Inc ( NDAQ ) has decided to alter the regulatory procedures carried out during an IPO, as per media releases. This is important because an interruption like this in a computer-driven platform weakens the confidence of investors.

Nasdaq believes that some effective alterations in the IPO procedures would do away with the problems, which delayed the much awaited IPO of Facebook from its scheduled time. This left traders apprehensive about the completion of their orders for shares.

However, Nasdaq pointed out that the delay primarily stemmed from certain technical glitches that occurred on its trading platform while processing order cancellations. The technical disorder induced other regulatory bodies to investigate into the issue and resolve it.

The mishap came as a surprise as Nasdaq otherwise is renowned for delivering superior technical performance. However, following the technical malfunction, Nasdaq is leaving no stone unturned to enhance its technological services to remain competitive.

Notwithstanding, Nasdaq still commands an advantageous position with new companies that are keen on being listed on it. Western Digital ( WDC ), which previously listed on Nasdaq's close competitor New York Stock Exchange ( NYX ), has decided to trade on Nasdaq from June 4. They opine that Nasdaq is "cost effective" and provides higher exposure to public.

Nasdaq currently retains a Zacks #4 Rank, which translates into a short-term Sell rating. We also retain a long term Neutral recommendation on its shares.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: FB , NDAQ , NYX

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