IPO’s on the Rebound

IPO’s are back on as becoming the new hot thing on Wall Street. The pace of new stock offerings perked up this spring after a cold winter, though who knows how long it will take before the market sees a real recovery. In the second quarter IPO numbers quadrupled what they were in the first quarter. Worldwide over 78 companies ended up raising a total of $10.6 billion compared to only $1.3 billion in the first quarter. These IPO’s were huge successes with companies like Rosetta Stone, Solar Winds, OpenTable, VisaNet, BridgePoint and several Chinese start-ups. OpenTable alone saw the best first-day performance since 2007 as the stock soared 59%. I feel optimistic about the overall shift within both IPO’s and Merger & Acquisitions, which are feeling the heat as they are being pressured to create new money. For IPO’s, this fall should show great success with several strong tech companies poised to take off most notably the Professional Social Networking Site LinkedIn. In fact, read my recent report on LinkedIn and the successes the company shall earn in the future. The whole industry feels assured that the IPO market will pick up in the fall and continue into the spring. I agree I don’t believe we are there yet but it’s coming. Merger & Acquisitions are also heating up with the talks of many buy-outs between oil conglomerates as long as the sale of many failing retailers mostly notably the recent purchase of FAO Schwartz by Toys R Us. Imagine that we are in the 5th inning so mid-way point of recovery with only good times to come. The consensus right now is that in the second half of the fiscal year we will see a large step towards extended economic growth. I want to believe this yet I still have my doubts with the large unanswered economic questions looming on President Obama’s agenda. Back to IPO’s however I expect the recovery within that industry to be seen primarily within China and the U.S. as these two countries have become very aggressive in responding to this economic slowdown. I don’t see a booming affect in IPO’s with them producing ridiculous returns yet I do see it as a starting point leading the wave for many new countries to turn public. Whatever way you look at this, the resurgence can only be seen as a positive as we see more once weak sectors within our financial system on the road to recovery.