IPO Market Thawing in April

Two initial public offerings scheduled for this week will mark the busiest period for the IPO market since August, a hint that institutional investors may be ready to take risks on new public companies.

Bridgepoint Education, a San Diego-based provider of online and classroom education services, is set to price its $216 million IPO later Tuesday and to begin trading on the New York Stock Exchange Wednesday under the ticker symbol BPI. The stock is expected to price between $14 and $16 a share.

Meanwhile, Arlington, Va.-based language-software maker Rosetta Stone is set to price shares between $15 and $17 for its $106 million IPO. Analysts expect the offering to price on April 16, with shares trading under the ticker RST the following day.

What's especially notable about both IPOs is the small number of shares being offered. Bridgepoint said in a regulatory filing it plans to sell 13.5 million shares, while Rosetta is set to sell 6.25 million shares. Rosetta said it plans to sell 3.125 million shares with the IPO, while the same number of shares will be sold by existing stockholders.

All that remains to be seen is if both Rosetta Stone and Bridgepoint can garner the same amount of investor interest as the only two other IPOs priced in 2009. Institutional investors, which comprise the bulk of IPO buyers, must be willing to take the risk in order for an IPO to be successful.

Chinese video game maker Changyou.com Limited (CYOU Quote) priced its IPO on April 1 at $16 a share, and the limited amount of shares offered (7.5 million) attracted a lot of attention from investors. The stock is now at $27 a share, good for nearly a 70% increase, according to Renaissance Capital, which operates the Web site IPOHome.com.