A few weeks ago, I made the observation that the software IPO market had actually generated solid returns relative to the market indices in the last year. Since then, we've had two more successful software IPOs:
CommVault Systems (CVLT)
Company Description (from website): CommVault is a leading provider of data management software applications and related services. They develop, market and sell a unified suite of data management software applications under the QiNetix (pronounced "kinetics") brand. QiNetix is specifically designed to protect and manage data throughout its lifecycle in less time, at lower cost and with fewer resources than alternative solutions.
- Prospectus
- 9/22 opened at $16
- 10/18 closed at $19.75
- 23% YTD gain
DivX Inc. (DIVX)
Company Description (from website): DivX is a digital media company that creates products and services designed to improve the experience of media. We built one of the world's most popular digital media formats that now powers an entire ecosystem of content, software and consumer electronics products.
- Prospectus
- 9/22 opened at $19.50
- 10/18 closed at $23.025
- 18% YTD gain
Paul Kedrosky makes a broader observation today about tech IPOs, and contends that this is the healthiest IPO market we've seen since the bubble.
The technology IPO resurgence continues, unremarked as ever. Since September 1st there have been 7 U.S. technology IPOs, only one of which, Shutterfly, is currently trading below its issue price. More strikingly, the average performance since issuance of these seven IPOs is 47%, more than four times that of the 14 non-tech IPOs during the same period.
I would love to hear where my readers stand? Do you view this as "good as it gets" or do you see plenty of runway for more technology issues in the coming months?
Note: At the time of this writing I, and/or funds I maintain discretionary control over, did not maintain a position (long or short) in any of the companies mentioned.
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