IPO Outlook: Smaller Backlog Of Deals Signal Tougher Climate; Weakness in Stock Market, Recent Lackluster Debuts Help Contribute to Decline
Dow Jones Newswires</br></br>The backlog of initiaI public offerings waiting to be priced is smaller than a year ago, an indicator of a worsening environment for bringing companies public.</br></br>About 114 companies are waiting to go public, based on filings with the Securities and Exchange Commission, down from 160 at the same time last year, according to data tracker Dealogic. The deals are estimated to be worth $20.9 billion, down from a waiting list worth $29.1 billion a year ago. Last week, just seven companies filed IPO paperwork with the SEC.</br></br>Much of the slowdown has to do with the broader stock market, which has been in the red almost the entire time this year. Some is because companies need more time to comply with the Sarbanes-Oxley Act, which requires detailed summaries of internal controls and auditor opinions on those controls.</br></br>And some is due to the rotten performance that some recent IPOs have put in, such as metal-products distributor Earle M. Jorgensen Co., which hasn't revisited its offering price of $10 a share since the moment it began trading.