Initial public offerings of stock likely will remain few and far between, and ones that do come to market will hail from sectors not usually found among new issues, namely areas such as food and energy. These aren't necessarily cutting-edge companies. Recent IPO filings have borne out this attitude. Credit Suisse Group's Credit Suisse First Boston and Citigroup Inc.'s Salomon Smith Barney are jointly leading the offering.
Investors appear to want more from the sector.
At a time when most companies are finding they have to price their IPOs well below expectations, an energy wholesaler, Reliant Resources Inc., actually raised terms. So, they really don't want IPOs in general, but are willing to take a chance with a new stock here and there, provided the company is an established one and in a sector considered to be a haven. That means fundamentals, like earnings, are important. Few tech companies have made it to market, and those that have faced tremendous pricing pressure. Wall Street underwriters expect to make up for the loss of new tech issues by bringing offerings from a hodgepodge of other sectors that only rarely appear in the IPO market.