The pipeline of companies hoping to go public is swelling, and that means investors will have more stocks to choose from.
In 2010, over 190 companies had filed plans to go public. It ranked this as the busiest year for initial public offering filings since 2007. There were 120 IPO filings in 2009 and 153 in 2008.
While most in the IPO pipeline were big companies such as automaker General Motors, there also were many up-and-coming firms that could use the fresh capital to generate jobs — and help reinvigorate the economy.
Tracking the economy; index shows slowing growth.
Even so, investors remained skeptical about the economy's prospects. During the past six sessions, the stock market has fallen 4.2%, shedding $600 billion in paper wealth, based on the Wilshire 5000.
So for some, instead of looking at the swelling IPO pipeline as a sign of hope, it's inciting skepticism because:
The struggling stock market could dim IPO prospects. The broader stock market needs to stabilize before many companies in the pipeline will have a chance at actually going public. If the market continues to stumble, many companies may be forced to shelve their plans, he says.
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