IPO “Spring” Might be Sooner than Experts Think

According to Bernstein Research, the IPO market for the next year (or two) is going to be about as successful as the Detroit Lions – in other words, not great.

But the IPO market might start picking up sooner than they think. With the amount of money sloshing around in Treasuries driving returns to near 0%. It stands to reason that investors will start looking for better things to do with their money.

In addition, private equity shops aren’t going to want to be “short stacked” for too long. Like a poker game, if you aren’t adding chips, you’re losing them.

The interesting thing is that Grand Canyon Education (Nasdaq: LOPE), which is the most recent IPO, has increased almost 50% since in November.

It’s a standout. Most IPO offerings in the last six months have been pulled, the remaining ones have lost sizeable amounts. Others, like Penthouse’ parent company, are finding that they are fighting lack of interest in addition to the chilly environment.

The take-away, is the recent IPOs that debuted in July and August like Rackspace Hosting (NYSE: RAX), GT Solar (Nasdaq: SOLR) and Energy Recovery (Nasdaq: ERII) have been brutalized by the market’s performance – perhaps unfairly.

Underwriters will probably err on the side of caution in pricing new IPOs – under-pricing them, and that could benefit early investors.

Companies mentioned in this article: LOPE, RAX, SOLR and ERII.

• Sun Still Shines on Trina Solar (TSL)
• Double Bottom For Markets?
• Small Cap Gains: 2 IPOs the Entire Market Should Be Watching

Sign Up now and receive this Free report: Collect 122% in the Next 12 Months From Gold's Surge.

The Single Best Investment for 2009

Forget another stimulus package. Or retreating into "safe-havens" like cash and gold. All you need in 2009 is a small exposure to the "secret" White Cap Index.

It's up as much as 171% straight through Wall Street's meltdown. And one of the latest stocks to be added - an Internet-related venture capital company - is up over 100% since its inclusion into the Index.

Just weeks from now, we'll add another White Cap stock to this market-trouncing index. To get a sneak peek, click here for full details.

2 Responses to “IPO “Spring” Might be Sooner than Experts Think”

1. Tom Piper Says:
   February 22nd, 2009 at 3:42 pm

   It sounds like you’re creating problems yourself by trying to solve this issue instead of looking at why their is a problem in the first place.

   Reply

2. Dave Navarro Says:
   February 24th, 2009 at 3:22 am

   Keep working ,great job!

   Reply

Comments

Check out our selection of daily Investment Research:

We Respect Your Privacy

---

What is Investment U?

Since 1999, Investment U has provided impartial, no-nonsense investment advice on how to build long-lasting wealth.

---

Recent Articles

Platinum Services

The Oxford Club is an exclusive, global network of investors, who collectively participate in the pursuit of prosperity and wealth. The Club is renowned for its market-beating, tried-and-true investment principles.

The White Cap Report exclusively identifies companies, White Caps, which - by being among the earliest to gain traction - have secured dominant positions within untapped, billion-dollar markets.

With an elite trading team at the helm, the Xcelerated Profits Report shows any investor how to "invest like a pro," using high-level, yet easy-to-execute strategies that "xcelerate" profits while minimizing risk.

---