This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
See Cramer's multi-million dollar portfolio for FREE and get his new book Get Rich Carefully! Learn More

IPOs Mostly Duds

What was supposed to be a big show of strength in the new-issues market fizzled Wednesday, bolstering concerns that the IPO craze of 2006 might have seen its best days.

Despite a marquee success in preppy retailer J. Crew (JCG), the overall trend was disappointing as underwriters struggled to sell as many as seven initial public offerings. Three deals priced below their hoped-for range, while three others didn't get priced at all.

"Looking at the past month, the fact that the majority have priced below the range makes you think the IPO market is softening in lockstep with the equity market," said Doug Lovett, equity analyst at Morningstar. "At the same time, we've seen a couple of IPOs withdrawn because companies weren't happy with the price."

J. Crew was the notable exception Wednesday, its shares jumping nearly 25% on their first day of trading. The company priced 18.8 million initial shares at $20 apiece Tuesday night, topping the expected range of $15 to $17 a share and raising about $376 million for itself and its private-equity backers. The offering cut the ownership stake of major shareholder Texas Pacific to about 40% from just above 50%.

By late morning, the stock had shot up $4.92 to $24.92, with more than 15 million shares changing hands.

But other deals had more trouble. Three of the companies that priced IPOs Tuesday night cut their offering price -- in one case by more than 30%.

PGT (PGTI) originally anticipated pricing between $16 to $18 a share, but ended up going out at $14. Meanwhile, Omniture (OMTR) priced at $6.50 per share, below the $7.50 to $9 a share range. Replidyne (RDYN) issued shares at $10 a share, $4 below the lowest range of its $14 to $16 price.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

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.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
DOW 16,408.54 -16.31 -0.10%
S&P 500 1,864.85 +2.54 0.14%
NASDAQ 4,095.5160 +9.2910 0.23%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs