Author:
9/30/2003 - 15:12 ET
|
[
Next Thread |
Previous Thread |
Next Message |
Previous Message
]
Date Posted: 30/09/03 12:42:34pm
Headlines
9/30/2003 - 15:12 ET
Tech sector remerged in Q3 IPOs
NEW YORK (CBS.MW) - Technology IPOs re-emerged as a force in the third quarter, as six deals rang up mostly solid gains on the heels of profitable results.
While the financial sector maintained its strength in the IPO market, the quarter saw big inroads from tech debutantes.
The biggest first-day gainer of the quarter was Digital Theater Systems (DTSI).
The maker of surround sound technology for home and commercial use rose 47 percent in its debut on July 10. The stock is now trading at about $28 per share, well above its $17 offering price.
Overall, the average opening day gain was 15.8 percent for IPOs in the third quarter.
The richest IPO of the quarter came from chip making firm AMI Semiconductor (AMIS), which raised $600 million in its IPO on Sept. 24.
The tech sector has at times comprised the largest component of the IPO market, at least in terms of the number of deals.
But with the stock market swoon dating back to 2000, tech IPOs dried up after underwriters rushed too many of them out the door during better times.
The bear market started to end late last fall as the Nasdaq and the Dow began rising from multi-year lows, but it wasn't until July that tech IPOs started to join the party.
Unlike the tech IPOs of the 1997-2000 bull market, IPOs from the sector nowadays usually offer long track records, solid revenue and net income in many cases.
During the boom, even companies with no revenue, but with a compelling business plan could go public as co-called "story" stocks.
Underwriters toned down the risk associated with tech IPOs by offering more established firms, and priced the deals often at a discount to their publicly traded peers.
John Fitzgibbon of newsletter 123Jump.com, said the third quarter amounted to the "greatest story never sold," meaning that stocks offering just a compelling tale of futures success rarely made it out the door.
Other bright performers of the quarter from the tech sector included InterVideo (IVII), Ipass (IPAS), Netgear (NTGR), Sigmatel (SGTL) and e-commerce player RedEnvelope (REDE).
Among financial service providers, standouts included National Financial Partners (NFP), CapitalSource Inc. (CSE) and Axis Capital Holdings (AXS).
Overall, the third quarter activity is well above the year-ago level in terms of the number of deals.
In the first quarter, five IPOs priced with proceeds of $991 million. In the second quarter, five deals priced with proceeds of $1.57 billion, and in the third quarter, 21deals priced with proceeds of $3.52 billion.
Last year, seven IPOs priced in the third quarter with proceeds of $5.13 billion. Most of the money raised came from the $4.6 billion debut of CIT Group.
IPO filings
With technology gaining its footing, the IPO market is toying with even more speculative companies from the biotech and pharmaceutical sectors as it looks ahead.
A total of 50 companies filed to go public in the third quarter, including a small flurry of biotech firms at the end of the summer.
Myogen, Aderis, TolerRX, Pharmion and Xcel Pharmaceuticals all filed IPOs in late August. See full story.
None of these biotech deals have yet to schedule a debut in the fall, but if the stock market moves past its current downdraft and begins rising again, investor demand for biotech IPOs may perk up in the fourth quarter.
[
Next Thread |
Previous Thread |
Next Message |
Previous Message
]
|
Feedback: 