Read the 100 Best Small Companies in America

The initial list based on the universe of public corporations with less than $1 billion in revenue. These companies are among the best for their size because they have increased revenue over the period covered by our analysis. Their relatively small sizes and robust sales expansion rates also makes it likely many will continue to grow even further, if the record of public company expansion is any example.  Past growth does not mean all of these firms will prosper, but most on this list have been consistently profitable, which adds to the chances of future progress.

Small companies, our research shows, usually have one or two specialized divisions and are focused on one core market. For instance, Steve Madden, True Religion and rue 21 have all carved out a niche segment in the apparel and footwear market. Their lack of diversity could be a drawback because the companies rely completely on one set of products, but it can also mean that management can be laser focused on a single opportunity.

Another industry which is well represented on this list is niche healthcare. Once again, most of the firms in this sector which made the list are in only one business. Mesa Labs makes manufacturing quality control products for medical devices. It is a narrow market, and there is no guarantee that a large device manufacturer might not attack the same sector. Bio-Reference Laboratories provides testing services. Cantel Medical provides infection prevention and control devices. This infection prevention business appears to be a relatively small one, but the overall medical industry in the US is expanding at such a rapid rate and regulations are changing so quickly that some of these companies will prosper because of these changes. Given the state of American healthcare costs, not many people would be surprised to see healthcare firms on a list of fast growing companies

These corporations are also often willing to take calculated risks, in some case, as they strive to expand their bases. Retailers are a good example.  Steve Madden, one of our companies, was started in 1990 with $1,100. The company has consistently added lines of apparel since then to increase revenue

Another reason to create this list is that 24/7 Wall St. recognizes that smaller companies continue to be a backbone of job growth. Corporations that are highly successful are roadmaps for the sort of industries, managements, and products and services which have done well recently. As recent access to capital has improved compared with access during the recession, well targeted and well run smaller businesses stand a much better chance of doing extremely well because they can tap pools of funding.   Methodology: We ranked these companies largely based on their growth rates as well as on how they have performed financially in the recent past. The pace of these growth rates allowed us to make a final selection and rank the companies when growth was combined with eight other categories. The 100 companies on our list had a median 20% sales growth and 30% earnings per share growth over the last 12 months. Similarly, the median stock price return for the latest year for this group was 16%, which is double the return of the S&P 500 index over the same time.

While stock market performance is one of our ranking criteria, we did not remove companies for poor performance because smaller companies tend to have greater price swings than the overall market. We should point out that this is not an investment list for value seekers. Maintaining these lofty growth rates is not an easy task.

S&P Capital IQ  provided us with corporate information, financial data and rankings based on a series of metrics. We started with a universe of 1,200 publicly traded, small companies, which we defined as having between $5 million and $1 billion in revenue over the last 12 months. To narrow this group down, we required that sales growth, earnings per share growth and return on equity to be greater than zero for both the latest 12 months and over the companies’ last five fiscal years. We also excluded companies whose stock price is lower than $5.This brought the size of the list to 164

The criteria we used to allow us to winnow the list to  100 companies  based on a few items which included stock price. We then assigned a rank based on all of the above growth metrics and stock price returns over one and five years. For companies whose shares were not traded for five years, we used annualized figures from their first trade date. From these category rankings, each company was given an overall score that was used to produce the list.

Brian Zajac

The financial data below is from the latest available reporting period and price change is as of March 21, 2012.

The unofficial closing bells put the DJIA down almost 27 points to 12,938.75 (-0.21%), the NASDAQ fell more than 15 points (-0.52%) to 2,933.17, and the S&P 500 fell -0.33% or nearly 5 points to 1,357.66.

There were several analyst upgrades and downgrades today, including Apple Inc. (NASDAQ: AAPL) reiterated as ‘outperform’ and target price lifted to $600 at Credit Suisse; Dell Inc. (NASDAQ: DELL) cut to ‘neutral’ at Citigroup and cut to ‘hold’ at Needham; The Mosaic Co. (NYSE: MOS) raised to ‘buy’ at Canaccord Genuity; Gilead Sciences Inc. (NASDAQ: GILD) cut to ‘market perform’ at Bernstein; and Dendreon Corp. (NASDAQ: DNDN) started as ‘neutral’ at Citigroup.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Basic Energy Services Inc. (NYSE: BAS) is up 0.15% at $19.90; Community Health Systems Inc. (NYSE: CYH) is up 14.3% at $23.61; Grand Canyon Education Inc. (NASDAQ: LOPE) is down -0.95% at $17.67; Range Resources Inc. (NYSE: RRC) is up 3.4% at $66.47; Central European Media Enterprises Ltd. (NASDAQ: CETV) is down -18.5% at $6.93; Chico’s FAS Inc. (NYSE: CHS) is up 16.9% at $14.97; Dollar Tree Inc. (NASDAQ: DLTR) is down -0.76% at $87.34; Garmin Ltd. (NASDAQ: GRMN) is up 9.2% at $48.81 after posting a new 52-week high of $49.93 (more coverage here); Novagold Resources Inc. (AMEX: NG) is flat at $8.75; R.R. Donnelley & Sons Co. (NYSE: RRD) is down -1.8% at $13.00; and Toll Brothers Inc. (NYSE: TOL) is down -4.8% at $22.56 (more coverage here).

Other standouts from today include the following stocks:

HealthStream Inc. (NASDAQ: HSTM) is up nearly 34% at $23.18 after posting a new all-time high of $23.19 earlier today. The Internet-based health learning company beat both EPS and revenue expectations in its most recent quarter.

Sourcefire Inc. (NASDAQ: FIRE) is up nearly 27% at $45.34 after posting a new all-time high of $45.50 earlier today. The Internet security provider handily beat earnings and revenue expectations last night.

Threshold Pharmaceuticals Inc. (NASDAQ: THLD) is up nearly 20% at $6.0. The pharmaceutical maker yesterday announced positive results for its pancreatic cancer treatment.

Newfield Exploration Co. (NYSE: NFX) is down more than -12% at $37.06. The independent oil & gas company missed EPS and revenue estimates last night.

Brightpoint Inc. (NASDAQ: CELL) is down more than -11% at $8.89. The mobile-phone wholesaler has cut its outlook for 2012.

Stay tuned for Thursday. We have noted the following events on the schedule (all times Eastern):

• 8:30 a.m. – New US claims for unemployment benefits
• 10:00 a.m. – Federal Housing Finance Agency (FHFA) house price index
• 10:30 a.m. – EIA weekly natural gas storage report
• 11:00 a.m. – EIA weekly petroleum status report
• 11:00 a.m. – Kansas City Fed manufacturing index
• 1:00 p.m. – 7-year note auction
• 4:30 p.m. – Federal Reserve balance sheet and money supply

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Paul Ausick

The ten companies we have looked at are Apollo Group (NASDAQ: APOL), Education Management (NASDAQ: EDMC), American Public Education (NASDAQ: APEI), Strayhorn Education (NASDAQ: STRA), DeVry (NYSE: DV), Washington Post (NYSE: WPO), Corinthian Colleges (NASDAQ: COCO), Bridgeport Education (NYSE: BPI), Grand Canyon Education (NASDAQ: LOPE), and Career Education (NASDAQ: CECO).

All data is from Yahoo! Finance, and current share prices were gathered in the mid-afternoon today.

Apollo Group has a median target price of $53.00 from 15 brokers. Shares are trading today at $46.09, for an implied gain of $6.91, or 15%. Apollo’s forward P/E is 12.72 and the company does not pay a dividend. The stock’s 52-week trading range is $33.75 to $54.23, and at today’s price that is about 37% above its 52-week low and 15% below the 52-week high. The company reported better-than-expected quarterly earnings a couple of weeks ago and jumped more than 10% in a day. But lower enrollments plague the company, which has managed to keep revenue up by raising tuition and fees.

Education Management has a median target price of $20.00 from 11 brokers. Shares are trading today at $20.48, about 0.5% above the target price. Education Management’s forward P/E is 13.36 and the company does not pay a dividend. The stock’s 52-week trading range is $11.56 to $28.61. At today’s price it is about 77% above its 52-week low and 28% below the 52-week high. The company beat both quarterly EPS and revenue estimates when it reported earnings last week. But a warning on future enrollment and profit declines have cooled enthusiasm for the shares.

American Public Education has a median target price of $45.00 from 10 brokers. Shares are trading today at $35.11, for an implied gain of $9.89, or 28%. APEI’s forward P/E is 14.50 and the company does not pay a dividend. The stock’s 52-week trading range is $26.15 to $49.29, and at today’s price that is about 49% above its 52-week low and 26% below the 52-week high. The company reports earnings next week and is expected to post EPS of $0.42 on revenue of $62 million. The EPS figure is less than the June quarter, but better than the same period a year ago.

Strayhorn Education has a median target price of $104.00 from 12 brokers. Shares are trading today at $83.06, for an implied gain of $20.94, or 25%. Strayhorn’s forward P/E is 11.39 and the company pays a dividend yield of 4.6%. The stock’s 52-week trading range is $69.34 to $165.73 Today’s price is about 29% above its 52-week low and 50% below the 52-week high. The company reports earnings on Thursday and is expected to post EPS of $1.07 on $139 million in revenue. That is a big dip from the same quarter a year ago, when EPS came in at $1.72, and an even bigger dip sequentially, from $2.53 in the June quarter.

DeVry has a median target price of $52.50 from 16 brokers. Shares are trading today at $38.14, for an implied gain of $14.36, or 38%. DeVry’s forward P/E is 8.55 and the company pays a dividend yield of 0.6%. The stock’s 52-week trading range is $34.24 to $66.85, and at today’s price that is about 11% above its 52-week low and 43% below the 52-week high. The company missed both EPS and revenue projections last week when it reported its first fiscal-quarter 2012 results. Enrollment was also lower as bleak job prospects keep potential students away.

Washington Post has a median target price of $275.00 from just a single broker. Shares are trading today at $336.80, about 18% above the target price. The forward P/E is 19.44 and the company pays a dividend yield of 2.6%. The stock’s 52-week trading range is $308.50 to $455.68. Today’s price is about 9% above its 52-week low and 26% below the 52-week high. The Kaplan education division of the company contributes more than 50% of Washington Post’s revenues and nearly half of net income. The company is expected to post EPS of $3.85 on revenue of $1 billion this Friday. The lack of coverage makes this stock a tough one to figure out.

Corinthian Colleges has a median target price of $2.00 from 10 brokers. Shares are trading today at $2.04, fractionally above the target price. Corinthian’s forward P/E is 9.93 and the company does not pay a dividend. The stock’s 52-week trading range is $1.24 to $6.12, and at today’s price that is about 65% above its 52-week low and 67% below the 52-week high.

Bridgeport Education has a median target price of $26.00 from 10 brokers. Shares are trading today at $22.94, for an implied gain of $3.06, or 13%. Bridgeport’s forward P/E is 8.88 and the company does not pay a dividend. The stock’s 52-week trading range is $13.89 to $30.62, and at today’s price that is about 65% above its 52-week low and 25% below the 52-week high. The company posted better-than-expected third-quarter earnings this morning and raised full-year EPS guidance to $2.95 to $2.98. Enrollment is expected to fall by about 5,000-8,000 students by the end of December.

Grand Canyon Education has a median target price of $18.50 from 10 brokers. Shares are trading today at $15.97, for an implied gain of $2.53, or 16%. Grand Canyon’s forward P/E is 13.22 and the company does not pay a dividend. The stock’s 52-week trading range is $12.26 to $20.66, and at today’s price that is about 30% above its 52-week low and 35% below the 52-week high. The company reports third-quarter earnings next week and is expected to post EPS 0f $0.25 on $109 million in revenues.

Career Education has a median target price of $20 from 11 brokers. Shares are trading today at $15.79, for an implied gain of $4.21, or 27%. The forward P/E is 8.77 and the company does not pay a dividend. The stock’s 52-week trading range is $12.24 to $27.60, and at today’s price that is about 29% above its 52-week low and 43% below the 52-week high. The company reports third-quarter earnings next week, and the consensus EPS estimate is $0.34 on $457 million in revenue. The EPS estimate has been trimmed from $0.46 over the past three months. Shares gained nearly 5% on October 19th, following the strong earnings report from Apollo.

Paul Ausick

Apple Inc. (NASDAQ: AAPL) Started as Outperform with $410 at Baird (expanded details).
Boston Scientific Corporation (NYSE: BSX) Started as Buy at Collins Stewart.
Capella Education Co. (NASDAQ: CPLA) Cut to Neutral at Baird.
Corinthian Colleges Inc. (NASDAQ: COCO) Cut to Sell at UBS.
Grand Canyon Education, Inc. (NASDAQ: LOPE) Cut to Neutral at Baird.
Logitech International (NASDAQ: LOGI) Cut to Sell at Citigroup.
Medtronic, Inc. (NYSE: MDT) Started as Neutral at Collins Stewart.
Monolithic Power Systems Inc. (NASDAQ: MPWR) Cut to Neutral at Gleacher & Company.
Portugal Telecom SGPS SA (NYSE: PT) Cut to Hold at Deutsche Bank.
PulteGroup, Inc. (NYSE: PHM) Raised to Neutral at Credit Suisse.
Statoil ASA (NYSE: STO) Cut to Hold at Societe Generale.
Syniverse Holdings Inc. (NYSE: SVR) Cut to Hold at Jefferies.

You can join our free daily email distribution list to hear more about dividend trends, analyst upgrades and downgrades, top day trader and active trader alerts, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

AgFeed Industries, Inc. (NASDAQ: FEED) is down 10% this morning after its earnings showed “an extremely difficult operating environment as a result of a series of severe floods throughout its area of operations.”  Shares are down 10.8% at $2.46 on over 65,000 shares.

Ambac Financial Group, Inc. (NYSE: ABK) is getting crushed after earnings because it disclosed that it is working on a bankruptcy filing as a contingency.  Shares are down 23% at $0.69 on over 1.5 million shares.

Capital Product Partners L.P. (NASDAQ: CPLP) is trading lower on a secondary offering as it plans to offer 5.5 million units to acquire MR Tanker M/T Assos for $43.5 million in proceeds.  Shares are down 7% at $8.48 on about 25,000 units.

Fossil, Inc. (NASDAQ: FOSL) is rising on stronger than expected second quarter earnings and a raised 2010 outlook.  Shares are up 7.5% at $45.65 on almost 40,000 shares.

Grand Canyon Education, Inc. (NASDAQ: LOPE) beat earnings estimates, but its guidance was short of estimates.  Can that be a shock considering the attack on for-profi education?  Apparently it is an excuse to sell the stock all over again.  Shares are down over 8% at $18.50 on thin volume.  The 52-week trading range is $15.87 to $28.46.

JA Solar Holdings Co., Ltd. (NASDAQ: JASO) is getting roasted in the sun a bit after posting a profit and raising its sales views.  Shares are down 3.3% at $6.35 on about 200,000 shares.  The 52-week range is $3.22 to $6.95.

MBIA Inc. (NYSE: MBI) is trading up after it reported a profit in the quarter.  Shares were up over 7% at $9.90 on over 400,000 shares.

Netflix, Inc. (NASDAQ: NFLX) is trading lower after signing a deal with EPIX where Netflix members can “instantly watch an array of new releases and library titles from EPIX streamed over the Internet from Netflix.”  Shares are down 1.8% at $114.80 on over 30,000 shares.

Nuance Communications, Inc. (NASDAQ: NUAN) had soft earnings and guided in-line for the quarter ahead.  It is an earnings nuance… Shares of the speech recognition software leader are down 9.4% at $15.74 on over 200,000 shares.

Penwest Pharmaceuticals Co. (NASDAQ: PPCO) is trading up only marginally after its Endo Pharmaceuticals buyout news.  Shares are up almost 5% at $4.96 on the deal that gives the company almost no premium.  The 52-week trading range was $1.80 to $4.89.

Qiagen NV (NASDAQ: QGEN) beat earnings but said it is eyeing large acquisitions.  The ADRs are down 3.7% at $18.82 on 139,000 shares and the 52-week trading range is $18.06 to $24.00.

QuinStreet, Inc. (NASDAQ: QNST) is a recent IPO and it is surging after earnings.  Shares are up 14.5% at $11.46 on only about 5,000 shares.  Its post-IPO trading range is $9.91 to $18.25.

You can join our free daily email distribution list to hear more about dividend trends, analyst upgrades and downgrades, top day trader and active trader alerts, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

As long as you keep seeing the DJIA, S&P, and NASDAQ hitting new intermediate highs and the market does not roll over, you can expect the floodgates for companies raising capital to continue.   Full details on each offering or filing are below.

B&G Foods, Inc. (NYSE: BGS) priced its public offering of 10,000,000 shares of common stock at $8.00 per share in a sale through Credit Suisse, Barclays Capital, and BofA Merrill Lynch.  The $80 million in gross proceeds comes to $75.6 million after all fees are deducted, or $86.9 million if the overallotment option is exercised in full.  After a 4% drop to $8.12 today, we have the market cap listed as $291 million.

China Marine Food Group Limited (AMEX: CMFO) has filed to sell up to $40,000,000.00 of any combination of  Common Stock, Preferred Stock, Depository Shares, Warrants, Rights and Units.  The company noted that it will retain a broad discretion over the use of the net proceeds under the “for general corporate purposes.”  Without the consideration of new shares, we show the market cap of this one as $116.5 million.  At $5.06, it is also at the upper end of its $1.10 to $5.83 range over the last year.

Converted Organics Inc. (NASDAQ: COIN) is selling units with stock and warrants, with public warrants under the “COINZ” ticker.  The sale of up to $44,476,350.00 in stock and warrants  is taking place through Chardan Capital Markets, LLC.

Grand Canyon Education, Inc. (NASDAQ: LOPE) priced 6,000,000 shares at $16.50 through Credit Suisse and BofA Merrill Lynch.  Of the sale, only 1,000,000 shares were sold by the company as 5,000,000 shares were unloaded by backer Endeavour Capital.  As the discount was effectively none, shares are up almost 4% at $17.15.

Legacy Reserves LP (NASDAQ: LGCY) sold 3.3 million units at $15.85 per unit through Raymond James and RBC Capital Markets.  The oil and gas partnership plans to use the funds to reduce outstanding borrowings under its revolving credit facility.  The near-$50 million compares to market cap of $509 million after a 2.8% drop to $16.40 today.

OpenTable, Inc. (NASDAQ: OPEN) filed to sell 3,790,033 Shares through BofA Merrill Lynch and others.  If the overallotment is exercised, this would come to 4,358,537 shares or a value of $116,076,558 based upon the filing figures.  Be advised, none of the funds from this go back to the company as every one of these shares are being sold by insiders and venture backers.  IAC/InterActive Corp. (NASDAQ: IACI) is selling some 750,000 as one of the backers here.

ParkerVision, Inc. (NASDAQ: PRKR) has filed to sell up to $50 million in securities in any combination of Common stock, Preferred stock, Warrants and Debt.  This company has a market cap of $127 million before the effects of any such changes, if any, from this filing.

QUICKSILVER GAS SERVICES LP (NYSE: KGS) has filed to sell any combination of Common Units, Debt Securities, Warrants, Purchase Contracts, and Units for an amount of up to $150 million.

UDR, Inc. (NYSE: UDR) has entered into an at-the-money sales agreement with Merrill Lynch and Morgan Stanley as sales agents and/or principals to sell up to 15,000,000 shares of common stock at prevailing market prices at the time of sale.

This is also just a snapshot of the immediate deals that were filed in the last 48 hours or which priced.  There are many other deals in the hopper for this week and next.

JON C. OGG
SEPTEMBER 15, 2009

The Obama Adminstration has levied huge import tariffs on Chinese tires claiming that they are exported to the US in a manner which damages the American tire industry unfairly.  Did President Obama just say “Blue Horseshoe loves Goodyear Tire & Rubber Co. (NYSE: GT)” in this call?  You might as well call this the Goodyear gift… You can also look for a benefit for Cooper Tire & Rubber Co. (NYSE: CTB) as well.  Just be advised, this tariff game is a knife which cuts both ways and the one doing the stabbing here often has to get stitches put on some wounds too…. We would also note that that the Cooper Tire pension plan just filed on Friday to sell some 1.5+ million shares of common stock.

Grand Canyon Education Inc. (NASDAQ: LOPE) is on deck with a secondary offering.  The company is selling six million shares expected to price as soon as Monday, although there is a discrepancy as the original filing was for 8 million shares, only 1 million of which were going to be from the company with the rest from private equity holders, but the new indication is a secondary offering of 6 million shares.

On Wednesday we have the return of a top American brand that is no longer American.  In some form, you can say that Budweiser is an import despite the notion that it is still brewed here.  But AB InBev, or Anheuser-Busch, is finally returning to America as a stock.  It is even taking back the old stock ticker of “BUD”…

Sprint Nextel Corp. (NYSE: S) may come under attack of a Deutsche Telecom (NYSE: DT) buyout offer if the reports are as advanced as they would lead you to believe.  This would come as almost no surprise other than the notion that it just has never happened.  And with our US dollar getting shelled it makes only more sense that a foreign company would look at this brand to rake in more than 30 million subscribers.    As our friend Joe Kunkle over at OptionsHawk.com said to us, “Very interesting considering that on September 4th, 170,000 call options traded with huge buying of the October $4 calls that traded more than 70,000 contracts.  There was also a lot of traders putting on bullish risk reversals, selling puts to finance the purchase of calls.” In short, Joe is saying that there is some large cash that was quietly put behind this notion.  We would look for a large pop in Sprint shares in the early trading hours Monday unless this is denied.

We have several key earnings this week.  Best Buy Co. (NYSE: BBY) is on deck for earnings on Tuesday, and we have a full preview for the top earnings this week so we can get an idea of just how well the technology and electronics spending by Joe Public is and if it justifies the huge jump this stock has made.  Larry Ellison and friends over at Oracle Corp. (NASDAQ: ORCL) have the CRM giant’s earnings after the close on Wednesday.  Palm, Inc. (NASDAQ: PALM) is going to be on deck Thursday for earnings.  While we would love to be overly cautious here, there is a problem in just panning it blindly because of the short interest.  If our fully diluted calculations are correct, there is roughly 40% of the float short in this one.  Here is a full preview on each of those with the formal estimates as well as much added color for what else to look for.

We hate to single out a commodity ETF as a key stock to watch for the week, but the SPDR Gold Shares (NYSE: GLD) is the most direct trading vehicle on the price of gold as it is solely a bet on the price of gold bullion.  About a week ago, our friends and affiliate over at INO.com made the call with some conviction that Gold was not just going to bust above $1,000.00… but could likely jump much higher in a power-band move.  We are awaiting an update to the call, mainly because this did finally get above $1,000 last week and stayed above $1,000 for the closing price.  The problem is that once that happened there was no major screaming inflows on the shiny yellow stuff to drive it immediately higher.  This will likely be the week that determines the fate of gold for the near-term and the GLD is the easiest way for Joe Public to play it long or short.

Rails need to play catch-up…. When a company the size of FedEx Corporation (NYSE: FDX) raises guidance, we generally expect to see a rally in the other modes of the transportation sector.  That happened in FedEx’s top competitors and it happened in trucking, but the rail giants of  CSX Corp. (NYSE: CSX) and Union Pacific Corp. (NYSE: UNP) were very weak and actually closed down here.  While these are not direct overlays on each other, there is still some delayed correlation here.

Another secondary trade is after Smith & Wesson Holding Corp. (NASDAQ: SWHC) had a good week after blowing away earnings, although the stock did not have a day-two follow-on rally.  It still posted over a 10% gain on the week.  But Sturm, Ruger & Co. Inc. (NYSE: RGR) actually closed down and the only little bump up it had was early on Thursday before getting rifled lower.  There should be and generally is more correlation here than what we saw this week, so watch RGR for a possible under-covered secondary catch-up trade.

You can always join our open email distribution list if you want to be notified of the unusual suspects, key analyst calls, Buffett and other guru investor activity, M&A, IPO’s and more.  This is our first full week back now that Labor Day has come and gone, so that means that the trading desks will be fully staffed and all players will be back.

JON C. OGG
SEPTEMBER 13, 2009

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Bridgepoint Education Inc. (NYSE: BPI) is being added to Russell 3000 and to the Russell Global.  DigitalGlobal Inc. (NYSE: DGI) is actually trading as a busted IPO and it is being added to Russell 3000 and to the Russell Global.  OpenTable (NASDAQ: OPEN) is being added to Russell 3000 and to the Russell Global.  Rosetta Stone Inc. (NYSE: RST) is being added to Russell 3000 and to the Russell Global.  RHI Entertainment (NASDAQ: RHIE) was a distant IPO but it is being added to Russell 3000 and to the Russell Global.  SolarWinds Inc. (NYSE: SWI) is a very fresh IPO and is being added to Russell 3000 and to the Russell Global.  There is also a list of other key IPOs which were not included for certain issues.

Changyou.com Limited (NASDAQ: CYOU) was not listed in the first preliminary list for the Russell 3000 but that could be from an ADR status, the percentage of the free float to total shares, and the recent spin-off.  Grand Canyon Education (NASDAQ: LOPE) was not listed on the preliminary list, and that may be a free float issue versus total shares.  Mead Johnson Nutrition Co. (NYSE: MJN) was also not on the Russell 3000 preliminary list, but that may be an issue over the total float and spin-off. RackSpace Hosting Inc. (NYSE: RAX) was not on the initial list.

As noted with the speculative energy stocks getting booted off the list, there will be changes and adjustments announced today and next Friday before the final-final lists are posted on Monday June 29, 2009.

Jon C. Ogg
June 19, 2009

Mead Johnson Nutrition Company (NYSE: MJN) was spun-off from Bristol-Myers (NYSE: BMY) and it priced a 30 million share offering at $24.00 while the market was in free-fall and this stock is still up close to 15% since the IPO in early February.  Again, this was a spin-off rather than a new private company coming public.

Grand Canyon Education Inc. (NASDAQ: LOPE) priced its 10.5 million share IPO at $12.00 in November.  That was the only IPO of late 2008.  Despite it being a venture-backed IPO where the backers were cashing out with very little going to the company, this one did very well because it is in online education.  We know how well that has done as a result of the recession.  Shares are at $16.68 today, a again of over 35% despite a monster market correction since the IPO.

A recent study from PricewaterhouseCoopers showed just how bad the IPO market has become.  On the prospects for a recovery of IPO’s in 2009, PWC expects that “the ‘thaw’ is expected to be slow, and significant IPO activity may not return until later in 2009.”

So here is our take.  All of these recent IPO’s have had issues that investors could argue are not necessarily “clean IPO’s” in the historic sense.  Yet they have all actually held up and risen from the IPO levels.  Can we bet that a flood of IPO’s will actually make it to market very quick?  That might be jumping the gun quite a bit.  But we’d expect a wave of new filings in the near-term and amended filings so that companies can come public rapidly if the markets are still strong and holding up into and after the summer.

So, who else is on deck in IPO-land?  Adult-oriented, i.e. ‘hooking-up, social networking site FriendFinder is still in the cue to hook-up for an IPO.  Another recent filing is from OpenTable, the online reservation system for restaurants.  Whether or not these make it to market is one thing, but we won’t be shocked at all if we start to see a wave of S-1 and F-1 filings in the SEC website.

JON C. OGG
April 2, 2009

Grand Canyon Education Inc. (NASDAQ: LOPE) priced its 10.5 million share IPO at $12.00 in November.  The price range for the IPO was lowered and it the original backers sold most of the shares.  This closed at $17.13 Thursday and rose another 10% after the company reported earnings.  It turns out that this one is in the economic sweet spot as it offers online graduate and undergraduate degree programs in education, business, and healthcare.

O’Gara Group Inc. has postponed its pending initial public stock offering indefinitely.  The maker of armored cars and military security systems was supposed to come public this month, but the market has not cooperated.  The original range of $17 to $19 for 8 million shares of stock was cut to $14 to $16, but now this one has been mothballed.

Changing World Technologies Inc., a producer of diesel fuel oil and fertilizers from organic waste, also postponed its IPO this month due to poor market conditions.

Other IPO’s which have been withdrawn this month are Third Wave Acquisition (SPAC, hotel?), Vitamin Shoppe (retail vitamins and health products), Big West Oil Partners, L.P. (independent refiner), TherOx (medical device), and Tensar (construction site solutions).

JON C. OGG
February 20, 2009