A Crowded IPO Calendar
The IPO market is taking a bit of a breather this week as investors look ahead to the big offerings in February, an analyst said Monday.
"It's kind of the lull before the storm," said John Fitzgibbon, editor of the IPO Reporter. "Should the market hold, February could go down as the month of the moonshot."
Nonetheless, there are a few deals slated to hit the market this week.
Radio station operator Entercom Communications Corp. plans to sell 10.85 million shares at $18 to $21 each. With about 42 stations, Entercom is the sixth-largest radio broadcasting company. The deal is being led by CS First Boston, with BT Alex. Brown, Goldman, Sachs and Morgan Stanley Dean Witter also on the ticket.
And Tut Systems is also set to offer 2.5 million shares at $14 to $16 this week. The offering by Tut Systems, which makes high-speed Internet access equipment, is being led by Lehman Bros.
But most analysts are looking ahead to February.
Consider this impressive line-up of companies waiting to sell shares to the public next month: Web software maker Vignette Corp., healthcare service company Healtheon, on-line seller Priceline.com and the electronic side of Ziff-Davis (ZD), ZDNet Group.
There are an estimated 33 Internet-related IPOs scheduled to come out over the next two months.
Not that all of the deals are Internet related. Del Monte Foods Co. has resurrected an offering. Other deals seen coming in February: Delphi Automotive Systems, the auto part maker being spun off by General Motors (GM), and corporate recruiter Korn/Ferry International.
Fitzgibbon added these big-name deals would help draw interest in other offerings. "As all this gets chewed up, the rest will go down as well," he said.
The tone for initial public offerings certainly improved last week, which closed with three strong issues. Web software maker Allaire surged to more than twice its offering price Friday as investors looked to its debut for a "safer" play on the expansion of the Internet.
"This is a great company, and a way to play the growth of the Internet without the volatility of a pure Internet company," said Paul Bard, analyst at Renaissance Capital.
The Cambridge, Mass.-based maker of Web site development software (ALLR) priced its 2.5 million shares at $20 each. Shares first traded at 36 on Friday, but rose to 48 7/8 on Monday afternoon.
Allaire is the second large IPO of 1999 in the U.S. stock market. Marketwatch.com (MKTW), the publisher of the CBS.Marketwatch.com site, made its debut last Friday.
Covad Communications, a Santa Clara, Calif.-based provider of high-speed Internet access, also had a strong debut on Friday. The company (COVD) priced 7.8 million shares at $18 each. Both the price and the size had been bumped up. Shares closed at 45 3/8 on Friday, but rose to 54 1/2 Monday afternoon.
Written By Brenon Daly, CBS MarketWatch