One Fine Day for IPOs
Updated from 2:26 p.m. EST
The new-issues market got a second wind Thursday, with five IPOs advancing in their debuts.
The performance, as the deals come from a broad array of sectors, is refreshing after two of three offerings fell below their issue levels Tuesday. "When a variety of companies come public and do well, it is a mark of a healthy market," said Francis Gaskins, editor of IPODesktop.com.
Insurer Assurant (AIZ) was lately up $2.55, or 11.6%, to $24.55 after pricing 80 million shares at $22 a share in a deal valued at $1.76 billion, the biggest of the year.According to a prospectus filing with the Securities and Exchange Commission, Assurant had net income of $263 million in the nine months ended Sept. 30, 2003 on revenue of $5.24 billion. The IPO is a spinoff from Dutch financial-services conglomerate Fortis. "The Assurant offering is a huge deal," said Gaskins. "The underwriters had to price it well in order to sell it. And so, it came public at a low price-to-earnings ratio." Based on earnings for the first nine months of 2003, Assurant is trading at a multiple of 8.9. In general, as they emerge from hibernation, IPO investors have favored profitable companies. The market reacted well to a $105 million offering from consumer debt collector Asset Acceptance (AACC) Thursday. The firm earned $12.1 million in the first nine months of last year. Shares were recently higher $1.50, or 10%, to $16.50. Even some money-losing names were doing well Thursday. Biotech Renovis (RNVS) was ahead $2.80, or 23%, to $14.89. "The company has a low price-to-book ratio," said Gaskins. Meanwhile, Bakers Footwear (BKRS) was up 48 cents, or 6.19%, to $8.25. The company had a net loss of $3.6 million for the nine months ended October 2003. Oil and gas driller TODCO (THE), a $144 million spinoff of Transocean Holdings was lifting $1.40, or 11.7%, to $13.40, though it is unprofitable. "They're the biggest supplier of drilling rigs off the Gulf of Mexico," said Gaskins.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV