IPOs hurry to cash in before the rush to the exits...
Sunday May 17, 2:09 pm Eastern Time
IPO VIEW-Busy IPO week ahead, but market may cool
By Holly Rosenkrantz
NEW YORK, May 17 (Reuters) - The coming week is jammed with companies scheduled to debut on the public markets, but some analysts said businesses may be rushing to get their IPOs in while the getting is still good.
Between broad economic concerns and the upcoming summer slow period for initial public offerings, underwriters are pushing their deals into the market, hoping to ride the wave of high prices for new issues that analysts said may be due to end.
''The window is closing on the IPO market,'' said John Fitzgibbon, editor of the IPO Reporter newsletter. ''The feast is coming to an end.''
In this IPO feast of recent months, new issues have been trading as a norm at levels that are at least several points higher than their filing prices.
Highlighting this market are the occasional big-name deals and the ever-sexy tech companies that shoot way above their IPO prices.
But signs of change are creeping into the IPO market, analysts said.
Fitzgibbon pointed out that the gain for IPOs, once they hit the broader market, has declined from its year high on April 24 of 34.3 percent to a current gain of 22.4 percent.
And some of the new issues of the past week that were expected to soar right after their IPOs are trading near the price of their deals, analysts said.
Mutual fund manager Federated Investors Inc. (FII - news), for example, went public Thursday and is trading near its $19 filing price.
Before the deal, though, analysts were comparing the stock with Waddell & Reed Financial Inc. (WDR - news), another mutual company that went public in March and saw its shares jump at least three points in early trading.
''Demand is kind of cooling off,'' said Ken Fleming, an analyst at Renaissance Capital Corp.
But supply certainly isn't. At least 15 IPOs are scheduled for the coming week, and some have even been pushed earlier by underwriters seeking to get their deals in before demand cools further, according to analysts.
For example, Professional Detailing's 2.8 million share IPO was recently moved to this Wednesday from the following week.
And a source at Credit Suisse First Boston said it may move the IPO for Capstar Broadcasting Corp. -- the largest radio broadcaster in the U.S. -- to the end of this week. The well-watched IPO is currently scheduled for the following week.
''When the market is favorable you want to get things out as fast as you can,'' said Vincent Slavin, an IPO analyst with Cantor Fitzgerald. ''The amount of deals we're seeing is telling us we're getting toward the top of the market.''
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