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Rocket Fuel Headlines Huge Week for IPOs

Posted
9/25/2013 2:33:00 PM
By: Wyatt Investment Research
Referenced Stocks:BNFT;FEYE;FUEL

Eleven IPOs have debuted on U.S. exchanges in the past week. Fittingly, a company called Rocket Fuel ( FUEL ) is soaring past them all.

The company isn't as exciting as its name. Rocket Fuel optimizes digital ad-buying by providing an automated platform to businesses. Sounds boring. But the returns have been anything but. Shares of Rocket Fuel have already doubled from their $29 IPO price since debuting last Friday.

Rocket Fuel isn't the only recent IPO with an incendiary name that's achieving major returns right now. FireEye ( FEYE ) , a security software provider that went public the same day as Rocket Fuel, is already up 85% despite a $20 IPO price that was well above the expected range of $15 to $17.

Benefitfocus ( BNFT ) , a provider of cloud-based solutions, had an even better debut, rising 102% in its IPO last Wednesday. The company has since fallen back to earth, however, and has "only" risen 81% from its $26.50 IPO price.

The sudden rush on IPOs - and the subsequent massive returns - clearly has a lot to do with the current health of the stock market as a whole. U.S. indices established new record highs last Wednesday. Not coincidentally, eight of the 12 IPOs to debut this month have priced since then.

Many more are on the way. According to IPO site Renaissance Capital , 19 more IPOs are listed on the upcoming calendar, waiting to price. Considering we're already in the midst of the busiest September for IPOs since 2006, that gives you a pretty good indication of the health of the market right now.