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Technology Stocks : IPOs: Too many, too fast, to little buyers? -- Ignore unavailable to you. Want to Upgrade?

To: Mad2 who wrote (62)	2/4/2001 8:00:30 PM
From: RockyBalboa	Read Replies (1) \| Respond to of 84

This one: Finally, KPMG Consulting to Capture Spotlight with IPO Feb 4 5:03pm ET By Emma-Kate Symons NEW YORK (Reuters) - The neglected market for new stock offerings will finally attract the attention of Wall Street this week when KPMG Consulting, one of the world's largest technology consulting firms, goes public in the first major deal of 2001. With an estimated $2 billion price tag, the debut of KPMG Consulting Inc. -- its parent, KPMG LLP, is one of the Big 5 U.S. accounting firms -- will be closely watched for signs of a hoped-for IPO revival, after the slowest January for new listings in 21 years. "I would hesitate to call it a bellwether but KPMG is going to test the waters definitely," said Randall Roth, a research analyst at Renaissance Capital's publicly traded IPO Plus Aftermarket Fund. "This is really the first substantial deal of the year." The broader market remains volatile, raising questions about KPMG's timing. On Friday, U.S. stocks posted their biggest drop in almost a month as investors cashed in profits from the recent tech rally. The Nasdaq Composite index <.IXIC> -- a barometer for the IPO market -- fell more than 120 points, or 4.39 percent, its biggest drop since early January. Investors had bid the Nasdaq up more than 12 percent in the new year after the index plunged nearly 40 percent in 2000. Now the composite is up only 7.7 percent year to date. KPMG TO TEST WATER FOR OTHER CONSULTING IPOS The success of KPMG, the first of the major consulting firms to go public, will undoubtedly be scrutinized by rivals like Accenture (formerly Andersen Consulting) and others contemplating a possible stock offering. But while KPMG may be a blockbuster IPO, it is not typical new stock offering fare, which adds an element of uncertainty to its debut. Technology companies tend to dominate, although the IPO cupboard has been bare since late 2000, as many firms withdrew plans for a public debut amid the Nasdaq's freefall. KPMG has already amended the terms of its offering, which is being managed by Morgan Stanley Dean Witter, as well as Goldman Sachs, J.P. Morgan and Merrill Lynch. In late January KPMG scaled back the number of shares being offered to 112 million, but increased the price range to $16-$18 a share from $6.75-$8.75. The company has received approval for a Nasdaq listing under the symbol "KCIN" . Opinions vary as to KPMG's potential for a successful debut, and how "successful" should be defined in current market conditions. Before the technology rout in 2000, the shares of some hyped technology companies enjoyed opening day rises of more than 200 percent above their debut price. Today, analysts say an opening day increase of anywhere between zero and 20 percent is respectable. "I don't have high expectations because the market is really struggling and consulting isn't a really hot area for investors at the moment," said George Nichols, a stock analyst at Morningstar.com. "Short-term traders have little to look forward to, but for long-term investors, we believe KPMG's IPO presents a good opportunity to buy a solid offering at a decent price." As Nichols pointed out, KPMG is in a category different from pure Internet consultancies such as Razorfish , which have performed poorly in the IPO aftermarket. Razorfish is now trading under $2, off from a high of $56-15/16. KPMG is profitable, with half of its revenues coming from Internet or "e-consulting," and the rest from more traditional areas. It counts 60 of the Fortune 100 companies as clients, Nichols said. Joe Stocke, a money manager with StoneRidge Investment Partners LLC, who oversees around $1 billion in assets in Malvern, Pa., said his firm is looking at KPMG's IPO. "Overall it's a weak environment currently but it's starting to tick up a little bit (the IPO market)," Stocke said. "And recent IPOs have done better than a lot of people expected in the aftermarket." KPMG should do well in its new offering, because when it comes to market "it will be an instant blue-chip," according to John Fitzgibbon, IPO editor of financial information provider WorldFinanceNet.com. "It has $2 billion-plus in revenues, it's profitable, it is a brand name and it should attract a lot of institutional interest."