Twitter going public at good time for IPOs
(MoneyWatch) Twitter's hotly anticipated market debut next week comes at an auspicious time for initial public offerings.
Not only has the stock market continued to jump this year, but IPO activity also has been hopping. To date there have been 221 offerings this year in the U.S., according to Renaissance Capital. That compares to 140 in all of 2012, a 58 percent jump, with more IPOs in the pipeline. And even with the economy's tepid growth, investors remain generally bullish.
Nasdaq has attracted 100 of those IPOs, the technology-focused exchange's highest total since 2007.
Some of the additional activity this year versus last may have been because of the JOBS Act of 2012, which loosened some requirements on smaller companies that want to go public (although many entrepreneurs apparently plan to pass on filing for IPOs).
Despite the public attention on Twitter, however, the number of tech IPOs relative to all types of companies making their market debut is lower this year, at roughly 18 percent, than between 2009 and 2012, according to Thomson Reuters. During the dot-com boom, at their peak tech IPOs amounted to nearly half of all share offerings and tended to hover above 20 percent of the total.
And here's a somewhat different breakout, according to Renaissance Capital, by number of IPOs per year.
Both sets of data show that health care is now the hot new sector. That could continue, as the Affordable Care Act, also known as Obamacare, is expected to drive more activity, particularly in the arena of applying technology to medical operations in a quest for efficiency.
How are investors doing? Insiders and big institutions have seen an average first-day pop of 16 percent so far this year, according to Renaissance. But that is unevenly distributed by industry, with consumer goods, tech and utilities companies seeing their shares rise 40.5 percent, 27.7 percent and 23.9 percent, respectively.
