FORTUNE – Lately, it seems like unprofitable tech companies are announcing IPOs every five minutes. And with that flurry of announcements comes the obvious question: Are we in a tech bubble? The question is on the lips of every CNBC anchor and fingertips of Twittering masses. It also came up last week amid a sea of dancing Candy Crush mascots on the floor of the New York Stock Exchange.
It was a few minutes after King (KING), the maker of Candy Crush, had listed itself on the exchange. The stock wound up listing a few dollars below the price its bankers had set the night before, and it promptly traded down upon its IPO. It wasn't as triumphant a moment as the morning of Twitter's (TWTR) IPO, when the stock took an hour to list at almost double the price its bankers had set the night before, resulting in a huge pop.
Was King's lackluster IPO a sign that investors are wary of a bubble? Scott Cutler, executive vice president and head of global listings at NYSE Euronext, says we are nowhere near 1999-2000 levels for IPOs. In fact, the deal volume we're seeing now is only slightly up each year since the drought of 2008.
Last year was the first time since the financial crisis in 2008 that the markets experienced a 12-month IPO window. Cutler says he expects this year to have another 12-month window. The exchange did around 150 IPOs last year and expects 2014 to end with 150 to 200. Compare that to 400 to 500 IPOs per year in the '90s.
"You can say valuations are high," he says. "But people are willing to pay more for companies that are growing. Investors know there is profitability coming in the future."
Unlike the dotcom era, many of today's companies -- King included -- have profits. Those that don't -- like Box and Twitter -- have growth and a big market opportunity. Investors are hungry for growth, and they're not finding it in other places of the market, Cutler says. "Investors are chasing pure-play growth in health care, energy, technology, financial services, and consumer."
Within tech, they're interested in social, mobile enterprise, and cloud companies. "Investors' overall tech spend is not rising," Cutler says, "but slices of the pie are going from thick to thin."
The NYSE has made gains in the tech sector, owing some of its popularity there to NASDAQ's poor handling of Facebook's IPO in 2012. This year, 15 tech companies have gone public, 10 of them on NYSE. Three more are expected to list on NYSE this week (GrubHub, OPower, and Rubicon Project). Last year, NYSE handled 30 new technology listings, representing 54% of all tech IPOs in the U.S. and 56% of capital raised in the sector.
Silicon Valley has fallen out of love with the initial public offering.
By Kevin Kelleher, contributor
FORTUNE – Last week, Silver Spring Networks went public on the New York Stock Exchange, an event notable not merely for being the stock market debut of a clean-tech star, but also because it was only the second technology IPO of the year.
Silver Spring (SSNI) raised $81 million in an offering priced at $17 a share. Its stock is MOREMar 19, 2013 6:52 AM ET
Facebook mulls over switching stock exchanges; what's next for Research in Motion?
Its I.P.O. botched, Facebook looks hard at Nasdaq [THE NEW YORK TIMES]
Executives at the Internet company are pinning much of the blame on Nasdaq, according to several people close to the company and its underwriters, who spoke on the condition of anonymity because of continuing shareholder lawsuits. Tensions remain so high that Facebook is still considering switching exchanges and MOREJP Mangalindan, Writer - Jul 2, 2012 1:02 PM ET
The flash crash that knocked $52 billion off Apple's market cap was hardly the first
By now anybody who reads the business pages knows that BATS Global Markets screwed up its initial public offering big time Friday by mangling trades in a bunch of stock symbols at the top of the alphabet, including Apple (AAPL) and BATS, its own stock.
Apple's shares briefly fell by more than $55 per share. BATS, which MOREPhilip Elmer-DeWitt - Mar 24, 2012 2:17 PM ET
Up 13.59% in a quarter in which the NASDAQ fell 12.91%
In his Tech Trader Daily column last week, Barron's Tiernan Ray noted that the three months that ended Friday saw some spectacular flameouts in the tech sector, including Netflix (NFLX) down 56.88% for the quarter, AOL (AOL) down 39.58%, Hewlett-Packard (HPQ) down 38.32% and Yahoo (YHOO) down 12.4%.
Amid the carnage, however, there were some relatively safe havens. Ray mentioned Apple MOREPhilip Elmer-DeWitt - Oct 3, 2011 5:00 AM ET
Overlooked in many of the post-mortems of Bartz's tenure at Yahoo is that, from a shareholder's perspective, she accomplished as much as anyone could have at Yahoo.
By Kevin Kelleher, contributor
FORTUNE -- "We always concluded we couldn't find anyone better than Carol."
That comment came from a board director of a company helmed by Carol Bartz. As you can imagine, the company wasn't Yahoo (YHOO) -- its board unceremoniously fired Bartz on MORESep 8, 2011 9:37 AM ET
The stock opened sharply lower, but then climbed steadily back
Traders on the Frankfurt exchange reacted swiftly Thursday to the news that Apple (AAPL) CEO Steve Jobs had submitted his resignation the day before, effectively immediately.
The stock opened 17.6 euros (6.78%) lower -- a even stronger reaction than was registered in after-hours trading on NASDAQ.
But cooler heads prevailed. By 7:45 a.m. EDT -- an hour and 45 minutes before markets were set MOREPhilip Elmer-DeWitt - Aug 25, 2011 7:57 AM ET
On June 17, he told readers to buy AAPL at $320. The stock took off two days later.
We gave Andy Zaky, an independent analyst with a enviable track record, a hard time a few weeks ago.
He had just published a report on his Bullish Cross blog (reposted on Seeking Alpha) advising investors to buy Apple (AAPL) at $320. Although his three previous Apple buy signals had proved prescient, we took MOREPhilip Elmer-DeWitt - Jul 8, 2011 7:06 AM ET
By the same "PEG" measure, the 3 most overvalued are Amazon, Cisco and Netflix
Here's a simple exercise suggested by one of my readers.
Take a stock you're interested in and calculate its price/earnings to growth ratio, better known as its PEG ratio. The formula looks like this:
According to Peter Lynch, who popularized the measure, the P/E ratio of any company that's fairly priced will equal its growth rate. In other words, MOREPhilip Elmer-DeWitt - Jun 19, 2011 7:08 AM ET
Trading in the company's shares Monday was slower than it's been since New Year's Eve, 2010
Apple (AAPL) has been trading in a narrow band this year -- to the undying frustration of investors who think the stock's price ought to reflect the company's breakneck earnings growth (EPS up 75%, 68%, 75% and 92%, respectively, over the past four quarters).
Apple's trading volume, by contrast, is as changeable as a baby's bottom, MOREPhilip Elmer-DeWitt - May 10, 2011 8:09 AM ET
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