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Raymond James Investment Banking Vice Chairman Fred Lane on the outlook for the IPO market and the sectors in which IPOs are doing the best.
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Number of IPOs initial public offerings year to date is up compared to this time last year.
But there's a service out that say that when you pick -- all -- -- -- Fred lane at one of our top experts -- we admire and listen to our regular basis that the increase number of deals although small current size is a great sign for the markets but could we see another IPO bubble burst joining us now from Boston -- a Fox Business exclusive is Fred lane.
Vice chairman of Raymond James investment banking you're trying not to smile -- know you know listen we we have bring crushes on guys like you because you're so Smart but.
Let's talk about this you say that the smaller deals heating up our good thing for the markets tell us why and what does that mean for the retail investor who's watching right now.
Well so far year to date IPO volume totaled dollars raises about a third of what it was last year.
So that would suggest oh my -- the IPO market really is not particularly good shape.
But the average deal size is now down at the 13040.
Million dollar range 150 million dollar range -- around 400 million dollars last year.
So these smaller deals tend to have perhaps a little less institutional investor domination.
And I also think that -- in general the IPOs at that have been price this year have done extremely well the first quarter IPOs are up.
Pretty close to 25% a little more than 25% actually technology deals even a little higher doesn't mean there aren't out flyers doesn't mean they have M -- deals.
They haven't perform well.
Not every deal is gonna be -- -- which is a big data play Bryant which was expected to price at eight to ten you may remember Liz.
Priced at seventeen.
And and now is up another 17%.
So from the bottom end of that eight to ten range it's.
Almost tripled in fact obviously investor -- -- but that sort through the five best performers.
Our technology names and now we start to strike into is some social media names that Linkedin is one that that comes to mind it has done very well for others though the -- is of the world have not so I'm just wondering if people get worried about a bubble bursting of sorts when it comes to certain types of IPOs do you see that are you worried friend.
I think it happen.
-- all IPOs you know I mean a deal couldn't comment acts they can trade up to 50% over -- And then trade down on not very good earnings and it may be trading below acts -- around -- everybody says gee that was a disastrous IPO it it probably wasn't.
But you know you have to be very careful -- -- highly volatile growth stocks.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- But also the IPO world.
Well I think I think everything that is in the software space -- tended to perform very well it's been priced well it -- traded up well be that there is that those companies are doing very well the so called software as a service SaaS cloud computing related companies are doing very very well.
I think when you look at Internet.
Based got the social media what I like about the biggest social media IPO ever -- that will ever get done.
Perhaps which is coming soon but you know when when you look at what's going on in general.
I would say that the software sectors extremely hot clean tech is actually cooled off.
Quite a bit as people want to see more more performance a little confounding given energy prices.
But and then -- it the health care information technology.
Other technology plays some of the -- Internet.
So based companies that those are all doing pretty well so I think in general it's a very favorable IPO market it has remained a discipline market in terms of pricing and that helps investors.
Sure does it sure does people like to see more IPO's and -- companies are successful enough to start looking to grow Fred great to see -- thank you for being here.
Fred -- vice chairman of Raymond James investment bank.
