Although some are predicting a Q3 resurgence of the IPO market, several factors may stack the deck for a continued downward trend, including tighter credit markets, fear about a possible recession and the fact that we're in a presidential election year. Some IPO hopefuls, as well as investors, may wait to see what a new administration might bring before deciding to take the risk.
Austin, TX (PRWEB) July 10, 2008
According to recent business intelligence regarding IPOs (initial public offerings), the number of U.S. IPOs decreased 77% for Q2 2008 compared to the same quarter a year ago, as reported today by Hoover's IPO Scorecard. This follows on the heels of Q1 2008, which saw a 73% decline in new offerings compared to Q1 2007.
In Q2 2008, only 13 companies went public on the major U.S. stock exchanges, raising $4.2 billion, compared to the same quarter in 2007 when 57 companies went public, raising $15.6 billion. According to business intelligence from Hoover's IPO Scorecard, so far this year, U.S. IPOs have raised $23.1 billion via 25 deals (Visa's Q1 2008 IPO represents $17.9 billion of this total), down 4% from the January through June 2007 period, when 101 IPOs raised $24.1 billion.
Findings from Hoover's IPO Scorecard for the second quarter 2008:
The best first-day gain for the quarter went to Hong Kong Highpower Technology, which rose 110%. The worst first-day drop went to Verso Paper Corp., which dropped 17% on the stock exchange in Q2.
Increased demand for food and agricultural commodities was apparent in the strong IPO performance of Intrepid Potash, the largest U.S.-based company that mines the essential potash fertilizer ingredient. The company's April IPO raised $960 million.
"It's evident that investor concerns about subprime mortgage losses, rising oil prices and the slowing economy continued from Q1 into Q2, based on the small number of companies going to market and the lackluster aftermarket performance of a majority of them," said Tim Walker, Hoover's industry expert. "Although some are predicting a Q3 resurgence of the IPO market, several factors may stack the deck for a continued downward trend, including tighter credit markets, fear about a possible recession and the fact that we're in a presidential election year. Some IPO hopefuls, as well as investors, may wait to see what a new administration might bring before deciding to take the risk."
Please see the attached table for details about the best-returning IPOs for Q2.
Hoover's delivers comprehensive business intelligence, insight and analysis about more than 27 million private and public companies worldwide, as well as information about industries and the people you need to know. Hoover's analyzes the IPO market daily to produce the quarterly IPO Scorecard. Each IPO Scorecard includes an assortment of facts selected by Hoover's editors for those following the IPO market, including the best- and worst-performing IPOs, the biggest one-day jumps and drops in the first day of stock exchange trading, and a breakdown of IPOs by industry sector.
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Hoover's, a D&B company, provides its customers the fastest path to business with insightful business intelligence about companies, industries and key decision makers, along with the powerful tools to find and connect to the right people to get business done. Hoover's provides this information for sales, marketing, business development, and other professionals who need intelligence on U.S. and global companies, industries, and the people who lead them. Hoover's unique combination of editorial expertise and one-of-a-kind data collection with user-generated and company-supplied content gives customers a 360-degree view and competitive edge. This information, along with powerful tools to search, sort, download and integrate the content, is available through Hoover's (http://www.hoovers.com), the company's premier online service. Hoover's is headquartered in Austin, Texas.
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