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Initial public offerings have already raised sixteen point eight billion dollars this year putting the market on track to have its -- years since the financial crisis.
Our next guest says not so fast don't get too hyper about this the IPO market.
Is actually struggling joining me now -- the man who says is David Manilow president of IPO financial dot com and not I'm gonna believe you because you're kind of -- guy when it comes to IPOs let's figure stuff when they're raising money hand over fist they look very good especially when you stretch it out for five years.
They're raising money to deal sizes themselves are larger but we need the quantity of offerings to come into the marketplace.
And confirmed that the investors are -- it with.
Vengeance -- -- quantity over quality yes well no I won't that was a tricky one -- attorney.
I show the -- the key here it is you want the quality what you want to spread over wider base of deals once you start getting the fifty.
Sixty million share offering some numbers get skewed but.
It doesn't really give a cross section for the market.
We have certainly seen some healthy IPO performances I think SeaWorld Boise Cascade.
Even solar city which was down dramatically today is well higher than its IPO price so what do you think has has really been the positive.
Tail -- for these name.
So I was about to you on -- you're going through those names because.
Once we get through the very visibly understood why they are -- not not because of what you were salad but it was you know the deals themselves yes we know that but.
That's not government gonna carry the market hours what we have coming forward is -- basically a five year plan what's been happening since 2008.
Here's your bar chart that shows you exactly what you're saying that the number is is down is that because people are scared yes there companies public and -- they're not scared to bring them publicly want to bring the public at the right time.
And what we're seeing in believe -- or not the secondary market is that the underwriters are pandering to the issuers.
So the deals are being priced just a little bit too high in some cases.
And investors are sitting back and say -- will do it at our levels we've got three names you wanna talk about that are launching IPOs that you feel might do well because -- -- already well established names out there just don't talk about those are the easy ones I don't know players Claire's Stores -- -- Claire's accessories I think I have to hello kitty sparkle -- that I -- there -- time ago stale if Cody who make up about some -- huge name out there.
Well established over decades right.
These are going to be the easy ones provided they are priced properly shall once we get past that -- -- -- you before about the sea -- and the other names that you mention.
Investors are looking over their shoulder saying what are we gonna do now let's revisit okay.
People who are new to the market or like the IPO idea -- you say don't ever jump in on the first day correct -- -- I -- say don't jump in on the first either they're not gonna be these wild opening premiums of fifteen to forty points that people remember from the IPO days you know.
You and -- way back when.
What the real issue here is if they're just gonna go on the cover and say oh what's coming from an under I don't know and it's a name that's not reason enough.
Here -- the IPOs on following the first day of trading you can see in 201231%.
Did so well it was a little bit more tentative trading on them back at one year ago certainly with the worries about Europe today not so much.
Master limited partnerships are going public yes these by the way for people who -- -- are usually energy.
Pipelines remove the liquid and they move the fuel through they also beautiful dividend.
Right perhaps and the key to these MLPs in the energy sector of something called an incentive distribution right and something that never gets any press.
This is an incentive for the journal partners that if they can increase the cash flow and increase the dividends they get a bigger.
Percentage so they're not doing this -- an altruistic wait for the investors -- doing for themselves -- investors are warm for the right.
Mean you'd say stay away this Phillips 66 by the way which did go Republican obviously did well again a well established on and -- vets don't get to come that's not a source they'll get dressed up.
Don't know I definitely think that these are the -- of the stocks to buy.
Because the assets are cheap and it's the same thing with real estate investment trust have been a lot of secondary is gonna come into the marketplace because they know -- assets are -- right now.
David -- always giving us very solid advice thank you so much IPO financial dot com check it -- thanks.
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