3 New Issues IPO Investors Need to Know About for This Week

The market for new stocks seems to be regaining its form, with a raft of IPOs hitting the market over the next few days.

May 5, 2014 at 10:16AM

Now this is more like it. After a fairly sleepy two weeks on the IPO scene with only a handful of issues coming to market, between now and Friday, nine new stocks are slated to hit the bourse.

They're fairly concentrated in terms of industry. With the exception of Cheetah Mobile (and Alcentra Capital, an issue I haven't selected for this week's candidates), they're in either the energy sector or the health care sector. This is characteristic of the 2014 IPO market thus far, which has seen a host of these issues.

A word before we get into our three selections for the week: IPO investing carries above-average risk, as initial stock prices can be far from the value the market eventually puts on the company's shares. This situation provides great upside potential, but it also carries the risk of losing a big chunk of an investment.

Thanks for listening. Now, on to our feature presentation.

K2M Group Holdings
This company is a niche of a niche. Operating in the medical-devices segment, its specialty is implements for the spine. According to the company, its technologies are used to treat some of the most challenging procedures involving that vital body part, including scoliosis (curvature of the spine). All told, K2M says, the global spine surgery market stood at $10 billion in 2012 and is anticipated to hit nearly $15 billion in 2019, so the opportunity appears to be there for the taking.

Just over 8.8 million shares of K2M Group Holdings will go on sale this Thursday, at a price of $16 to $18 per share. The issue's lead underwriters are Wells Fargo (NYSE:WFC) Securities, Piper Jaffray, and Barclays. The stock will be listed on the Nasdaq under the ticker symbol KTWO.

Cheetah Mobile
China-based Cheetah Mobile makes its coin from the provision of mobile security solutions. The company says its cloud-based data-analytics engines conduct real-time analysis of mobile apps to screen out behavior that might indicate risk to a system and its security. With those analytics, Cheetah Mobile also provides information that helps businesses deliver targeted content to users. These are hot areas, and the company seems to be capitalizing on them: Its top line more than doubled on a year-over-year basis in fiscal 2013, and it's been profitable since 2012.

Twelve million American depositary shares of Cheetah Mobile will hit the market on Thursday, priced at $12.50 to $14.50 apiece. They will trade on the New York Stock Exchange under the ticker symbol CMCM. The underwriting syndicate is being led by Morgan Stanley (NYSE:MS)JPMorgan Chase (NYSE:JPM) unit J.P. Morgan, and Credit Suisse (NYSE:CS).

PBF Logistics
Thanks to the world's insatiable hunger for almost every type of energy, many companies in the sector are launching master limited partnerships to reap the benefits of such a corporate structure. Subsidiaries of downstream petroleum concern  PBF Energy (NYSE:PBF) are floating this MLP, which, in the blunt words of its prospectus, is to "own or lease, operate, develop, and acquire crude oil and refined petroleum products, terminals, pipelines, storage facilities, and similar logistics assets." On an unaudited pro forma basis, the predecessor entity to PBF Logistics took in nearly $51 million in revenue in 2013 while netting a profit of $38 million ($1.20 per unit).

PBF Logistics is being brought to market by an underwriting syndicate headed by Barclays and UBS Investment Bank. Slightly over 13.7 million units will be sold on Friday at a price of $19 to $21 each. The home of the units is to be the NYSE, where they will trade under the ticker symbol PBFX.

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4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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