The Best IPOs of 2010

BOSTON (TheStreet) -- Initial public offerings dried up in 2008 amid the global economic crisis, although 2010 is shaping up to be a rebound year in terms of IPO volume in the U.S.

According to Renaissance Capital's IPO Home Web site, 57 IPOs have been priced in 2010, a 533% increase from the same time period a year ago. More than $8.5 billion in total proceeds have been raised so far this year; that's over 350% more than in the first six months of 2009.

Even though 2010 has nearly eclipsed the previous year in terms of the number of IPOs (57 already in 2010 to 63 in all of 2009), the average IPO return in 2010 has been -3.6% from the offer price, a statistic that may scare investors away from initial public offerings in the second half of the year. However, some IPOs have rewarded investors with substantial returns. TheStreet examines the highest-returning IPOs in the first half of 2010 and what investors can expect the rest of the year.

10. MaxLinear ( MXL) is a radio-frequency and mixed-signal integrated circuits provider for broadband communications applications.

IPO Date: March 23

Offer Price: $14

Return Since IPO: 13.3%

Stock: MaxLinear's IPO priced above its expected range of $11 to $13. The stock has a price-to-earnings ratio of 45.97, which is expensive compared to the semiconductor industry average of 11.98. For instance, Analog Devices ( ADI) has a P/E ratio of 13.99.

Consensus: Of the four analysts covering MaxLinear, all recommend purchasing its shares. Thomas Weisel offers a target of $23, leaving a potential return of 42%. Both Deutsche Bank and Needham & Co. expect the stock to hit $19.

9. ReachLocal ( RLOC) is an online marketing solutions provider for small- and medium-sized businesses.

IPO Date: May 19

Offer Price: $13

Return Since IPO: 14.3%

Stock: ReachLocal's IPO priced well below its expected range of $17 to $19. Shortly after going public, ReachLocal said underwriters of the IPO exercised their option to buy an additional 625,000 shares of common stock. In its prospectus, the company said it expects "to incur net operating losses for the foreseeable future."

Consensus: ReachLocal currently has no analyst coverage, having gone public less than a month ago.

8. China Lodging Group ( HTHT) is a Chinese economy hotel chain operator.

IPO Date: March 25

Offer Price: $12.25

Return Since IPO: 15.6%

Stock: China Lodging's IPO priced at the high end of its expected range of $10.25 to $12.25. The stock has a price-to-earnings ratio of 44.38, which is expensive for the leisure industry. For example, Choice Hotels International ( CHH) has a P/E ratio of 20.23.

Consensus: Of the researchers covering China Lodging, three, or 75%, advise purchasing its shares and one suggests holding them. Brean Murray offers a target of $18, implying upside of 26% of the next 12 months. Goldman Sachs has the lowest price target at $14.75 per share.

7. SS&C Technologies ( SSNC) is a provider of financial services software and software-enabled services.

IPO Date: March 30

Offer Price: $15

Return Since IPO: 21.6%

Stock: SS&C Technologies' IPO priced at the high end of its expected range of $13 to $15. With a price-to-earnings ratio of 21.24, SS&C is above the software services industry average of 14.88. For comparison, DST Systems ( DST) has a P/E ratio of 9.77.

Consensus: Of analysts covering SS&C Technologies, five, or 71.4%, advocate buying its shares, and two recommend holding them. Raymond James has a target of $22, which represents a 22% increase from current levels. Both Deutsche Bank and JPMorgan have a stock price target of $20.

6. Graham Packaging ( GRM) is a supplier of plastic containers for foods including juice and sports drinks, dressings, condiments, and beers.

IPO Date: Feb. 10

Offer Price: $10

Return Since IPO: 23%

Stock: Graham Packaging's IPO priced well below its expected range of $14 to $16. The stock has a price-to-earnings ratio of 7.53, which is below the foods industry average of 15.78. Owens-Illinois ( OI), a fellow packaging company, has a P/E ratio of 9.16.

Consensus: Of analysts covering Graham Packaging, five, or 83.3%, recommend buying its shares, and one suggests holding them. Citigroup offers a target of $16, leaving a potential return of nearly 30%. Goldman Sachs expects the stock to hit $14, the lowest price target of the coverage group.

5. DynaVox ( DVOX) is a software technology company that aids people with speech and learning disabilities.

IPO Date: April 21

Offer Price: $15

Return Since IPO: 23.9%

Stock: DynaVox's IPO priced at the low end of its expected range of $15 to $17. DynaVox has a price-to-earnings ratio of 41.06, well above the software services industry average of 14.88. Shares have traded below the offer price before ramping higher in early June.

Consensus: Of the four analysts covering DynaVox, all recommend buying shares. Piper Jaffray's price target of $20 implies gains of 9% over the next 12 months.

4. Financial Engines ( FNGN) is an investment management provider.

IPO Date: March 15

Offer Price: $12

Return Since IPO: 26.5%

Stock: Financial Engines' IPO priced above its expected range of $9 to $11. Financial Engines has a price-to-earnings ratio of 54.21, compared to the financial services industry average of 27.69. Among some of its peers, Ameriprise Financial ( AMP) has a P/E ratio of 10.92. Financial Engines also has a high price-to-book ratio compared to its peers.

Consensus: Of analysts covering Financial Engines, two suggest buying its shares and one advises holding them. Piper Jaffray offers a target of $21, leaving a potential return of 38.5%. Goldman Sachs expects the stock to hit $18.

3. Piedmont Office Realty Trust ( PDM) is a real estate investment trust, primarily focusing on office buildings in major cities around the U.S.

IPO Date: Feb. 9

Offer Price: $14.50

Return Since IPO: 35%

Stock: Piedmont Office Realty's IPO priced below its expected range of $16 to $18. Based on a single analyst estimate for the full year, the stock has a price-to-earnings ratio of 27.18, which is expensive compared to the investment industry average of 18.31. Among some of its closest peers, Government Properties Income Trust ( GOV) has a P/E ratio of 18.43.

Consensus: Of analysts covering Piedmont Office Realty, two, or 33.3%, advise purchasing its shares and four recommend holding them. RBC Capital Markets has a target of $22, leaving a potential return of 11.6%. JPMorgan expects the stock to hit $20.

2. China Electric Motor ( CELM) is a Chinese micro-motors and components manufacturer.

IPO Date: Jan. 28

Offer Price: $4.50

Return Since IPO: 35.3%

Stock: China Electric Motor's IPO priced below its expected range of $5.50 to $6.50. Based on a single analyst's estimate for full-year earnings, China Electric has a price-to-earnings ratio of 7.34, a sharp discount to the electrical industry average of 25.18. Shares rallied in June after China Electric said it replaced its chief financial officer, ousting Haixia Zhang in favor of Heung Sang.

Consensus: Only one firm, Roth Capital Partners, covers China Electric Motor. The firm has a buy rating and price target of $9, which implies a return of 47.5% over the next 12 months.

1. Primerica ( PRI) is the insurance and financial products seller spun off earlier this year by Citigroup ( C).

IPO Date: March 31

Offer Price: $15

Return Since IPO: 43.7%

Stock: Primerica's IPO priced above its expected range of $12 to $14. Primerica shares reached a high of $25.89 on April 14, and the stock made a run to that high in early May after the insurer posted first-quarter results. Based on full-year earnings estimates, Primerica's stock trades at a price-to-earnings ratio of 11.29, which is below the average for S&P 500 companies but above other insurers, including MetLife ( MET) (9.65) and Prudential Financial ( PRU) (10.17).

Consensus: Of the six analysts covering Primerica, all recommend holding its shares. UBS and Macquarie have a target of $27, leaving a potential return of 25.8% over the next year. Keefe Bruyette & Woods expects the stock to hit $23.

-- Written by Robert Holmes in Boston.

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