IPO Market 2013: What's Next After the White-Hot Start

Tim Melvin

The IPO market has had a strong first half in 2013, in some cases delivering double-digit gains for those who have ventured into IPO investing.

As the stock market has staged an impressive rally, investor demand to get into the IPO market is returning to pre-credit-crisis levels. The second quarter was actually the most active three-month period for IPOs in six years.

So far in 2013, we have seen 92 deals. The average gain for initial buyers is around 20%.

The pace seems to be picking up, as the first quarter saw 31 deals raise about $7.6 billion, and the second quarter had 61 offerings raise more than $13 billion.

Financial firms, including real estate investment trusts (REITs), have been the most active industry, with 35 offerings. Healthcare companies are right behind, closing in on 34 deals so far this year.

Some analysts think we could see more than 200 deals by the end of the year.

That means more opportunity for IPO investing for double-digit gains…here's where to look.

IPO Market 2013 Outperformers

Technology IPOs have had a pretty strong performance this year, with faster-growing tech companies among the top performers:

• The top-returning IPO of the year has been ExOne Co. (Nasdaq: XONE). The 3D printing company has seen its shares rise by 27% since its debut back in February.

• Then there's Marketo Inc. (Nasdaq: MKTO), which provides a cloud-based marketing software platform that enables organizations to engage in modern relationship marketing in the United States. The stock has risen by more than 170% since its IPO back in May.

• Textura Corp. (NYSE: TXTR) provides collaboration and productivity software tools for the construction industry, and its stock is higher by 120% since its debut offering in June.

Food-related stocks have also had a spectacular year in the IPO market in 2013:

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Tim Melvin

About the Author

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Tim Melvin is an unlikely investment expert by any measure. Raised in the "projects" of Baltimore by a single mother, he never attended college and started out as a door-to-door vacuum salesman. But he knew the real money was in the stock market, so he set sights on investing - and by sheer force of determination, he eventually became a financial advisor to millionaires. Today, after 30 years of managing money for some of the wealthiest people in the world, he draws on his experience to help investors find "unreasonably good" bargain stocks, multiply profits, and build their nest eggs. Tim tirelessly works to find overlooked "hidden gems" in the stock market, drawing on the research of legendary investors like Benjamin Graham, Walter Schloss, and Marty Whitman. He has written and lectured extensively on the markets, with work appearing on Benzinga, Real Money, Daily Speculations, and more. He has published several books in the "Little Book of" Investment Series and a "Junior Chamber Course" geared towards young adults that teaches Graham's principles and techniques to a new generation of investors. Today, he serves as the Special Situations Strategist at Money Morning and the editor of "Max Wealth" and Heatseekers.

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