That’s what I talked about this week with Matt Krantz of USA Today . . .

IPOs find struggling market a tough go for new stocks

. . . and Emily Thornton of Bloomberg/BusinessWeek . . .

Blackstone IPOs Show Barriers to Returning Fund Cash

Here’s my take on the IPO market in a nutshell:

• It has lost some momentum since the 4th quarter of 2009. There’s still plenty of time in February for both filings and actual market debuts to pick up, but filings peaked in December and debuts were fewer in December and January than they were in September, October, or November.
• Most of the offerings coming to market are small — less than $250 million.
• We’ve seen more downward re-pricings and delayed offerings for IPO aspirants. (Lynn Cowan of Dow Jones covers these like a hawk.)
• The weather for IPOs seems to have gotten worse as the broader stock markets have slid this year.
• In general, it seems that investors are grappling with a new IPO pricing calculus growing out of (a) a slow, uneven, and jobless recovery; (b) a lower tolerance for risk among investors; and (c) an unwillingness by investors to stomach debt-laden balance sheets from private-equity owned IPO aspirants. (For more on the last point, see this item from the New York Times DealBook.)

For all the specifics of filings, debuts, pricing, and so on, check out Hoover’s IPO Central.

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Related posts:

• 22 Jan. 2010 — My thoughts on the IPO market.
• 6 Nov. 2009 — The IPO drumbeat continues.
• 20 Sept. 2009 — More of my IPO opinions, in long and short form.
• 24 Aug. 2009 — Increased volume and average value of IPO filings in Q3.

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Photo by Bruce Tuten.

Or at least some of them, are available in this USA Today story by Matt Krantz:

IPO market making noise again, but sell-off slows recovery

As the headline suggests, the IPO market would probably benefit from more of a bullish streak in the stock markets as a whole.

My take-home lessons, in brief:

• The IPO market remains much healthier than it was a year ago.
• It would benefit from a better flow of filings, and especially filings for offerings worth $500 million and above.
• The IPO recovery has been well distributed across industries, and there’s no reason to think that won’t continue.
• There’s been a mix of IPO debutants based in the U.S. and based elsewhere, which is also likely to continue. (It’s particularly interesting to note the assortment of IPO filers headquartered in China.)
• The IPO market thrives on overall market stability, even when the economy is down. The recent string of little slides in the NYSE and NASDAQ could disrupt the impression of stability and raise worries among IPO aspirants and their underwriters, thereby chilling the environment for offerings.
• The next IPO bubble is still nowhere in sight.

That’s how I see it for now.

If you’ve been following the posts on the IPO market here, you’ll know that things got much better during the third quarter of this year. Well, the story has stayed happy during October and the early days of November, too.

You can get full details on the IPO Performance pages (October, November) of Hoover’s IPO Central.

Also worth a read: this short article from Matt Krantz of USA Today:

Hyatt, Ancestry.com successes show IPO market mending

The story quotes me as saying, “We’re seeing a healthy IPO market but not an overheated market.”

That’s what I think. Now, what about you? Where do you see the IPO market headed over the next several months?

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Related posts:

• More of my IPO opinions, in long and short form.
• News from the IPO front, complete with gratuitous self-promotion.
• Increased volume and average value of IPO filings in Q3.

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Photo by Infrogmation of New Orleans.

Yes, we’re rolling in IPOs these days. My short-form opinion comes in this BusinessWeek article, which quotes me:

IPOs: Investors Test the Waters, Warily

The long-form opinion is this piece, which I just wrote for The Deal Magazine:

Better weather ahead for IPOs?

Don’t worry, it’s not that long — just 1,300 words — but if you want a teaser before diving in, here’s a key excerpt:

A stocked pipeline of filings and healthy equity markets are indicators of something bigger that’s prized throughout the IPO arena: predictability. That’s precisely what has been lacking over the past several quarters. It was bad enough that the economy turned sour in 2008; it was worse, in terms of predictability, that it happened during a hotly contested U.S. election season that promised very different paths for corporate regulation and financial oversight depending on who got elected. And then came a series of highly unpredictable — even unthinkable — events like the failure of Lehman Brothers Holdings Inc., the selloff of Merrill Lynch & Co. and Washington’s bailout of major banks and carmakers. It was hardly a ripe environment for bringing a fledgling company to the public equity markets, as the IPO of Rackspace so painfully demonstrated, and it’s no wonder that investors rushed for the exits.

By now, the processes of economic recovery are under way. For better or worse, depending on your viewpoint, we have much more clarity on Washington’s likely actions. Major banks no longer teeter on the edge of collapse. And investors have bid up the Standard & Poor’s 500 by more than 25% in the past six months.

These conditions favor a steady cadence of IPOs — something dear to the hearts of investors, underwriters, venture capitalists and entrepreneurs alike. Beyond that, they enable an occasional IPO splash by a company with less-than-stellar financials but strong promise for the future.

Please do give the Deal article a read — and give me an earful of what you think about it in the comments.

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Actually, you have to go all the way back to May 2008 to match the seven IPOs that debuted last Thursday and Friday.

Details on the IPO Performance page of IPO Central.

Expect the final quarter of 2009 to be much busier than any of the past two years on the IPO front . . .

First things first: gratuitious self-promotion. I’m quoted in these two articles from today’s papers on the health and doings of the IPO market:

• USA Today: Investors’ reactions mixed as IPOs make a comeback
• Wall Street Journal: IPO Market Snaps Back as Taste for Risk Returns (subscription required)

The upshot of my commentary is that the current busy, busy week for IPOs counts as big news not because any one market debut is so important — though A123 Systems is sitting pretty this morning — but because it marks such a departure from the drought-like conditions through which investors, underwriters, and aspiring IPO debutants have been suffering.

On tap: a much fuller pipeline of IPOs . . . and possibly more commentary from yours truly appearing in the national press. Meanwhile . . .

Do you think the IPO markets have really turned?

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Photo via Bob Bobster.

Bullet points for brevity:

• July IPO debuts = 3
• August IPO debuts = 5
• September IPO debuts so far = 1

Compare that to the companies filing to make an IPO sometime in the future:

• July filings = 11
• August filings = 15
• September filings to date = 7

There have already been some big filings mixed in for September, too — including Cobalt International Energy ($1.15 billion) and Shanda Games Limited ($800 million).

My impression: the pipeline is filling, but real recovery for the IPO markets is still to come. That’s what I thought a couple of weeks back when I talked to Ben Steverman of BusinessWeek for this article, that’s what the folks at the Wall Street Journal think, and that’s what the ongoing numbers point toward.

Stay tuned: the end of 2009 and (especially) 2010 could be much, much better times in the world of IPOs.

An interesting tidbit I uncovered today when I was trawling through the Filings pages on IPO Central: the current quarter is better than any of the previous four quarters in terms of

• number of IPO filings,
• total value of proposed IPOs, and
• average value of proposed IPOs.

Here’s the whole story, in handy chart form:

This doesn’t mean that happy days are here again for the IPO market (especially if you equate “happy days” with any period like the dot-com bubble of ten years ago), and even a robust IPO market can’t save us from continued economic weakness or uncertainty.

It does mean, though, that the folks running these companies — and the market-savvy financiers working for their IPO underwriters — like their chances for making sensible IPOs over the coming months better than they did at any time in the past year.

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Related posts:

• Total value of 2009 IPO filings, month by month.
• A bumper crop of IPOs?
• A (relative) flurry of activity in the IPO market.
• Silicon Valley, the IPO drought, and the culture of innovation.

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1. This month’s haul of IPO filings, which we talked about a couple of weeks ago, keeps getting bigger. Combine the proposed offer amounts of all ten filings this month, and you get a total of $4.57 billion, which makes this easily the biggest month of 2009 in terms of both the number of filings and their dollar value.

2. By contrast, July has been pretty quiet for actual IPO debuts. There was one on July 1 (LogMeIn, Inc.), there’s one today (PennyMac Mortgage Investment Trust) . . . and that’s it. This is something of a letdown after months of three, three, and seven IPOs, but maybe it’s just the summer doldrums.

UPDATE: Turns out we got another IPO on the 30th — Globe Specialty Metals.

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Photo by Tambako the Jaguar, used under a CC No Derivative Works license.

Looking over the current IPO Filings page at IPO Central, I was struck by the fact that filings from last week and this totaled more than $1.1 billion. (Remember, these are just companies filing so that they can later make an IPO — they’re not going public yet.) So I glanced back over the months of this year to see what the earlier totals were.

• January: nil.
• February: nil.
• March: nil.
• April: 1 for $100 million.
• May: 2 totaling $1.0 billion.
• June: 6 totaling $2.02 billion. (Note the four separate $500 million offerings in that mix.)
• July to date: 4 totaling $1.17 billion.

As I’ve said before, I’m not ready to proclaim that the IPO market has recovered — and, indeed, I think that the “recovered” market will look different from what we’ve been used to over the past 20 years.

But, hey, baby steps.

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Photo by wrestlingentropy.