If you blinked last week, then you missed seeing the busiest five-day period that the IPO market will likely experience this month.
A total of five initial public offerings of stock began trading from Tuesday through Friday, and that is about as good as it is going to get for a weekly count in June. With just eight business days left in the month, things are expected to be slower through this week and the first half of next week, with more companies waiting to see what the market looks like after the Fourth of July holiday before launching their deals.
"I would expect that was our busiest week this month," said Bill Buhr, head of research at Morningstar Inc. "There's still a lot of uncertainty in the markets."
Although there isn't much data to go on—just six deals in total for the month so far—IPO performance in June is actually shaping up to be a better month than May.
Only one company, Nobao Renewable Energy Holdings Ltd., pulled its IPO after failing to be priced, compared with a half dozen in May. (Other deals also got shelved in May and June, but they had been sitting around for months and hadn't been scheduled to be priced.)
Three deals out of six traded higher on their debuts in June, compared with four out of 11 in May; two deals ended their first day essentially flat in May, while one did so in June. CBOE Holdings Inc. rose 12% after pricing at the high end of its range last week, the first deal to price that well and then trade higher since PAA Natural Gas Storage LP in April.
Despite the CBOE's success and a gain of 19% from banking company Higher One Holdings Inc. during its debut on Thursday, no one is expecting a rush of new offerings for the rest of the month.
"Favorable performance of IPOs from [last] week may help to improve the tone of the market but will not be enough to impact deals in June," said Scott R. Cutler, head of listings in the Americas for NYSE Euronext. "However, it will help to try and push deals out the door in July," with as many as 10 companies trying to access the market.
Ten deals in a month would have been a pittance in 2007 before the economic downturn, when it wasn't uncommon to see twice that number in a busy month. But it is definitely an improvement over last July, when only one company made it out the door, or even June 2009, when three did.
Looking ahead, there is some positive chatter about electric-car maker Tesla Motors Inc.'s debut next week, but not much else. This week, just one deal is expected, from optics-manufacturing specialist Fabrinet, which first filed to go public in July 2007.
