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IPO burst follows gains in market

Published: Friday, Sept. 20, 2013 7:23 p.m. CDT
(AP photo)
Penguins from SeaWorld are escorted by their handlers on the floor of the New York Stock Exchange during the company's IPO in New York. In 2013 there have been 140 initial public offerings, up 46 percent from September last year, according to Renaissance Capital.

The stock market has been heating up, driving demand for IPOs.

There have been 140 initial public offerings of stock this year, up 46 percent from the same time in 2012, according to IPO tracking firm Renaissance Capital. Of the eight companies that went public this week, two – cybersecurity software maker FireEye and technology advertising company RocketFuel – nearly doubled in value Friday.

The pace does not appear be slowing down. Next week, market watchers expect as many as 13 more companies to make their debuts. If all of them price, it will be the most IPOs in the U.S. in one week since 2007, when 14 hit the market at once, according to data provider Dealogic.

With the stock market hitting new highs, investors want to take chances they might not otherwise take in a flat or down market, said Scott Sweet, senior managing partner at IPO Boutique, which researches and invests in IPOs.

The Standard & Poor’s 500 index, a broad gauge of the stock market, has risen nearly 5 percent this month. If that holds, it would be the index’s best monthly performance since January.

How many companies are going public and how much money they’re raising reflect investors’ confidence and taste for taking risks. A rising stock market can make investors feel more optimistic about the general business climate and more eager to take a chance. Companies can grow quickly after an IPO, adding jobs and making investments with the new cash.

The success of some prominent IPOs in recent years, such as Michael Kors Holding Ltd., has also helped increase investors’ appetite, said Josef Schuster, an IPO analyst.

Here’s a look at the companies anticipated for the week of Sept. 23:

• Applied Optoelectronics Inc.: Fiber-optic networking products provider based in Sugar Land, Texas.

• Covisint Corp.: Detroit-based company that provides a data-sharing platform primarily to the auto and health care industries.

• Enzymotec Ltd.: Israeli maker of lipid-based nutritional ingredients and medical foods.

• Evoke Pharma Inc.: Biopharmaceutical company based in San Diego that develops drugs to treat gastrointestinal disorders and diseases.

• Fate Therapeutics Inc.: A San Diego biotechnology company developing stem cell treatments.

• Foundation Medicine Inc.: Cambridge, Mass.- based company that offers diagnostic cancer analyses that provide patient-specific data for physicians.

• Montage Technology Group Ltd.: A provider of chips for set-top boxes, based in China.

• Ophthotech Corp.: A New York biotechnology company developing therapies for eye diseases.

• Pattern Energy Group Inc.: Wind power company, based in San Francisco, with eight projects in U.S., Canada and Chile.

• Premier Inc.: A company that collects and analyzes clinical and financial data for health-care facilities, based in Charlotte, N.C.

• RingCentral Inc.: Cloud-based phone system provider for small businesses, based in San Mateo, Calif.

• Tecogen Inc.: A maker of natural gas-fueled heat and power products that aim to reduce energy costs and greenhouse gas emissions, based in Waltham, Mass.

• Violin Memory Inc.: A flash storage maker based in Mountain View, Calif.

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