Investing

2009 IPO Scorecard, Up 27% On Average (CYOU, RST, MJN, DGI, BPI)

We have been keeping track of the 2009 IPOs that made it to market, and while one is barely broken, a portfolio of the IPOs from the pricing level gives a solid performance that might allow more and more IPOs to come to market.  For the 2009 IPOs we have only Changyou.com Limited (NASDAQ: CYOU), Rosetta Stone Inc. (NYSE: RST), Mead Johnson Nutrition Co. (NYSE: MJN), DigitalGlobal Inc. (NYSE: DGI), and Bridgepoint Education Inc. (NYSE: BPI).

Here is how each has done on a per-IPO basis, with the strongest performers first.

  • Changyou.com Limited (NASDAQ: CYOU) priced at $16.00 and hit $29.00 today.
  • Rosetta Stone Inc. (NYSE: RST) priced at $18.00 and hit $23.80 today.
  • Mead Johnson Nutrition Co. (NYSE: MJN) priced at $24.00 and hit    $28.80 today.
  • DigitalGlobal Inc. (NYSE: DGI) just last week priced at $19.00 and hit $19.75 today.
  • Bridgepoint Education Inc. (NYSE: BPI) is only busted IPO that priced at $10.50    and is trading at $10.29 today.

We tallied up a $10,000 investment in each of these at the pricing to derive what a portfolio would look like from the pricing.  This is only 5 stocks, but this is all we have to work with from 2009 IPOs.  So a $50,000 investment in all of the 2009 IPO’s would be worth $63,541.00 today (pennies rounded down).  That is a gain of 27% on average.

Obviously, it is not fair to say that this portfolio would have netted out secondary market investors the same as many trad up from the IPO pricing.  But this is what drives IPO investors in their decision making, and this may be what gets the investment bankers and private companies off the fence to start issuing more and more IPO’s if the market remains strong or stable.

JON C. OGG
May 18, 2009

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