'Facebook flu' hits IPO market
IPOs have come to a standstill after the social network's notorious market debut.
None. The party is over after Facebook (FB) trashed the place. In fact, June is looking to be the driest month for initial public offerings in nine years, CNBC reports. Historically, June has been the No. 3 month for IPOs, behind October and November.
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Now, there isn't a direct link between Facebook's disastrous IPO and the barren month that followed. But you can't help but wonder how many hopeful CEOs watched Facebook's market debut -- and the numerous technical flubs over at Nasdaq -- with a few tears in their eyes.
CNBC is calling it the "Facebook flu," an apt description because there's no cure here. IPO-hungry execs just need to drink plenty of fluids and wait it out. The best medicine of all would be a smashingly successful IPO to help push Facebook back into the dark corners of the market's mind.
Only four deals are expected to be priced at the end of the month, and none are generating much excitement. We have EQT Midstream, a natural gas and energy company; Exa Corp, which makes engineering software; cancer drug maker Tesaro and cloud-software company ServiceNow.
ServiceNow, by the way, marks Morgan Stanley's return to the IPO market after it led Facebook's debut. Morgan Stanley and dozens of underwriters made an estimated $100 million in profit from Facebook's IPO, so it's not too disgruntled over the drama.
Facebook could help erase the black mark from its IPO with a stock upturn, and for a while Thursday, that appeared to be taking place. The stock soared out of the gate to approach $32.40, but fell back and closed with a gain of less than 1% to $31.84.
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