The market tacks on the latest addition to its publicly traded family today as Kinetic Concepts (NYSE:KCI) begins trading. In a sign that things bode well, the company previously raised the number of shares in the offering, and the deal priced last night at $30 a share, higher than even the ambitious expected range of $27 to $29.
It doesn't hurt that we're talking about a real company making real money, with nearly 30 years in the medical supplies business. The provider of therapeutic specialty beds, surfaces, and related devices earned $55.6 million over the first nine months of 2003 before recapitalization charges. Revenues surged by 32% to $547.9 million, just tipping the company into the enviable realm of double-digit net profit margins.
Nor does it hurt that new issues in the health-care sector have been well received by the market. Corgentech (NASDAQ:CGTK), Renovis (NASDAQ:RNVS), GTX (NASDAQ:GTXI), and Eyetech Pharmaceuticals (NASDAQ:EYET) have all gone public in the past month. Only GTX is trading lower than its offering price, while the others have all produced double-digit percentage gains.
While the biggest IPO of the year will probably be Google -- if it does in fact go public -- a steady stream of quality companies has joined the ranks of the publicly traded.
Does that make you want to jump in and start buying? Hold up a sec! Check out our ABCs of IPOs to learn more about the process, including the risks involved. Shares of popular offerings are usually hard to get before they are bid up in the market, and those new deals that are readily available to the typical investor are flashing the "Vacancy" sign for a reason.
So tread carefully out there. But if you sense a bit of unusual energy in the markets today, don't worry, it's just Kinetic.
Did you get in on the Kinetic Concepts IPO? Do you know the difference between an initial and a secondary offering? How does the IPO process work exactly? Hey! Wasn't Google supposed to have gone public by now? All this and more -- in the Initial Public Offerings discussion board. Only on Fool.com.
Longtime Fool contributor Rick Munarriz would go public, only the float would be a single miserable share. He does not own stock in any company mentioned in this story.
