With Facebook’s initial public offering set to launch, the IPO market clearly looks set to get a big infusion of capital come spring. Considering the current weakness in U.S. IPOs, it will be a welcome boost.
According to Greenwich, Conn.-based Renaissance Capital, U.S. IPOs priced so far in 2012 are off 30% compared with this time last year. Year to date, proceeds raised a total of $1.5 billion, a minus 80.9% change from last year. So far, 22 IPOs have been filed, down 8.3% over 2011 at this time.
Even before the Facebook launch, the Technology sector’s IPOs have been the most popular in the last 12 months, at 35% of all IPOs, in 11 sectors. Tech deals totaled $400 million for five deals. The next largest sector, Health Care, saw three deals totaling $200 million.
Average total return on Technology IPOs came to 22.2% versus 6.8% for Health Care. Another stand-out sector was Consumer, which launched two deals totaling $200 million for an average total return of 39%.
In a positive for the market, Renaissance Capital’s U.S. IPO index shows a 14.7% return so far this year compared with 7.5% for the S&P 500 index of large-cap U.S. equities.