Record-high stock prices are fueling the busiest month for
IPOs in at least a decade.
Fifteen companies priced initial public offerings on U.S.
exchanges in the first 10 days of May - the
traditional start to summer sell-off
period. Ten IPOs priced last week alone, making it just the
second double-digit IPO week since 2007. Another 12 IPOs are
scheduled to go public in the coming days.
The largest May IPO thus far has been
Quintiles Transnational (
, a biopharm research organization that raised $947 million in
its debut. Three of last week's IPOs were real estate-related - a
nod to the ongoing housing recovery.
One thing that could slow the
down in the coming weeks is the modest returns. Of the 15
companies that have gone public this month, only three of them
have managed double-digit returns. Eight of them are either in
the red or flat since their debuts.
Insys Therapeutics (
has been May's most successful IPO by far. It's a company that
sells synthetic marijuana as a cancer drug. So far, that's been a
big seller (I'll give you one guess as to why): the stock posted
a first-day return of 18.8% and is up 35.4% since its May 2
Seven more companies are slated to go public this week. If the
current pace holds, there would be 45 IPOs this month. To put
that in perspective, no month has had as many as 30 IPOs since
May 2007, and the 31 that went public in October 2004 marks the
highest monthly IPO tally of the last decade.
As long as stocks keep setting records, the IPO market is
likely to remain red-hot.