As IPOs begin to pick up this year amid the ongoing crisis, the one sector unexpectedly leading the way is technology. After all it is not as stable as probably some firms that have been in existence for decades.
Though the overall low number of IPOs in both years makes it hard to call a definite trend, technology isn’t an area that market observers had expected to provide the first foothold for new stocks in 2009. When baby-formula maker Mead Johnson Nutrition Co. kicked off the year in February, it fit the classic definition of a company that would provide a solid performance for skittish investors: large, more than 100 years old, with a brand name known world-wide.
WSJ is reporting that it has already surpassed the total number of IPOs completed last year just within the first four months of this year. It also cited some of the biggest double-digit single-day gains from them.
Every one of this year’s tech deals has produced double-digit percentage first-day gains, and the latest, from online restaurant reservation system OpenTable Inc., generated the best debut of any U.S. IPO since December 2007, rising 59% on Thursday. (It fell 11% on Friday.)