Scouting the Latest IPOs

Just like opening day at the ballpark, investing in new IPOs holds the potential for shining promise and crushing disappointment. If you simply can't bear just cheering on your favorites from the sidelines, at least be careful about investing in this league. Many new issues swing for the fences during their first trading days, only to slump once marketing hype has given way to mundane earnings reports.

Don't commit an error by stocking your entire portfolio with rookies. Allocate just a small percentage of your risk capital to IPOs. Scout your potential phenoms carefully, and be choosy about composing your own rotisserie league. Investing with an eye for a season extending long beyond opening day will reward you with quality players capable of staying in the game. With that in mind, we offer our Foolish scouting report of the latest IPOs.

Last week's games
Only two games were played last week. The players are ranked below, according to their returns from their offering price to the close of their first trading day.

Loser: Danaos Corporation

• Ticker: NYSE: DAC
• Industry: Greek shipping company
• Deal terms: 10.3 million shares, $21 per share
• Lead managers: Merrill Lynch and Citigroup
• Filed: Sept. 19
• Opening day: Oct. 6, opened at $21, closed at $20.85; 0.7% loss
• Bleacher banter: Priced at midpoint of its expected range

Bigger loser: Breitburn Energy Partners

• Ticker: Nasdaq: BBEP
• Industry: Oil and gas partnership
• Deal terms: 6 million units, $18.50 per unit
• Lead managers: RBC Capital Markets and Citigroup
• Filed: May 12
• Opening day: Oct. 4, opened at $18.21, closed at $18.21; 1.6% loss
• Bleacher banter: Priced below its expected $19-$21 per unit; another recent energy deal facing tough reception

On deck
Several major IPOs are slated for the coming week, including the following:

Acme Packet

• Proposed ticker: Nasdaq: APKT
• Industry: Telecom-network session border control provider
• Proposed deal terms: 11.5 million shares, $6.50-$7.50 per share
• Lead managers: Goldman Sachs, Credit Suisse, JP Morgan, and ThinkEquity Partners
• Filed: June 2

eHealth

• Proposed ticker: Nasdaq: EHTH
• Industry: Online health insurance provider
• Proposed deal terms: 5 million shares, $10-$12 per share
• Lead managers: Morgan Stanley and Merrill Lynch
• Filed: April 25

ImaRX Therapeutics

• Proposed ticker: Nasdaq: IMRX
• Industry: Biopharmaceutical
• Proposed deal terms: 5 million shares, $10-$12 per share
• Lead managers: CIBC World Markets, Jefferies & Co., and First Albany Capital
• Filed: May 19
• Note: Held over from the prior week

Ivivi Technologies

• Proposed ticker: AMEX: II
• Industry: Medical device maker
• Proposed deal terms: 2.5 million shares, $6-$8 per share
• Lead managers: Maxim Group and Brean Murray
• Filed: Feb. 11, 2005

Light Sciences Oncology

• Proposed ticker: Nasdaq: LSON
• Industry: Cancer treatment developer
• Proposed deal terms: 5.25 million shares, $14-$16 per share
• Lead managers: Cowen & Company and Wachovia
• Filed: April 24
• Note: Held over from the prior week

Rosetta Genomics

• Proposed ticker: Nasdaq: ROSG
• Industry: Israeli genomic therapeutics developer
• Proposed deal terms: 3 million shares, $11-$13 per share
• Lead manager: CE Unterberg Towbin
• Filed: Sept. 1
• Note: Held over from the prior week

SAIC

• Proposed ticker: NYSE: SAI
• Industry: Technical consultant
• Proposed deal terms: 75 million shares, $13-$15 per share
• Lead managers: Morgan Stanley and Bear Stearns
• Filed: Sept. 1, 2005

UltraPetrol Bahamas

• Proposed ticker: Nasdaq: ULTR
• Industry: Marine transportation provider
• Proposed deal terms: 12.5 million shares, $13-$15 per share
• Lead managers: UBS and Bear Stearns
• Filed: March 30

Games of the week
If last week's games didn't pique your interest, this week's schedule -- showcasing a potential megadeal and two techs -- should.

Science Applications International, or SAIC, is seeking to raise $1 billion in one of this year's largest offerings. Only three other deals this year have surpassed that dollar level: MasterCard, Grupo Aeroportuario del Pacifico, and Warner Chilcott.

The technical government consultant is another of several government contractors recently eyeing going public, riding an upswing in outsourcing and increased needs arising from global conflicts. Just because things are trendy, though, doesn't necessarily mean they reward the pocketbook. At least, not yours -- the prospectus mentions that a special dividend between $1.6 billion and $2.4 billion will be declared prior to the offering and paid to holders of record following the transaction. Chances are that your name isn't on that list. Don't fret too much, though. Defense consultant ICF International closed up just a penny on Friday from its September offering price. Upcoming offerings are also planned from information technology service provider Stanley and unmanned aircraft service provider Aerovironment.

Techs worth checking out include Acme Packet and eHealth, both looking to continue the recent good fortune of tech offerings while boasting profitability and rising revenues. Acme provides technology which allows service providers to deliver secure interactive communication across Internet network borders. The offering's low projected price range may also stir up additional interest. eHealth's story is that of an online health insurance provider that has developed more than 150 partnerships with insurance carriers to provide more than 5,000 health insurance products online. The offering's small float should also stimulate demand.

Warming up in the bullpen
Asthmatx, an asthma treatment developer, announced deal terms of 5 million shares, offered at $11-$13 per share. The lead managers are Piper Jaffray, Bear Stearns, First Albany Capital, and Jefferies & Co.

Catalyst Pharmaceutical Partners, a biotech, announced deal terms of 3 million shares, offered at $11-$13 per share. The lead managers are First Albany Capital and Stifel Nicolaus.

Douglas Emmett, a property manager, announced deal terms of 55 million shares, offered at $19-$21 per share. The lead managers are Lehman Brothers, Merrill Lynch, and Citigroup.

ExlService Holdings, an outsource business services provider, announced deal terms of 5 million shares, offered at $10-$12 per share. The lead managers are Citigroup, Goldman Sachs, Merrill Lynch, and Thomas Weisel.

First Mercury Financial, an insurance underwriter, announced deal terms of 9.7 million shares, offered at $16-$18 per share. The lead managers are JP Morgan and Keefe, Bruyette & Woods.

Globalstar, a telecommunications provider, announced deal terms of 6.5 million shares, offered at $16-$18 per share. The lead managers are Wachovia and JP Morgan.

LeMaitre Vascular, a medical device maker, announced deal terms of 6 million shares, offered at $8-$10 per share. The lead managers are Goldman Sachs, CIBC World Markets, Cowen & Company, and Thomas Weisel.

Stanley Inc., a government consultant, announced deal terms of 5.3 million shares, offered at $12-$14 per share. The lead manager is Citigroup.

Trubion Pharmaceuticals, a biotech, announced deal terms of 4 million shares, offered at $13-$15 per share. The lead managers are Morgan Stanley, Bank of America, Pacific Growth Equities, and Lazard Capital Markets.

Universal Compression Partners, a natural-gas services provider, announced deal terms of 5.5 million units, offered at $19-$21 per unit. The lead managers are Merrill Lynch and Lehman Brothers.

Sent down to the minors
Aside from the holdover debuts noted above, no companies postponed their offerings.

Minor-league developments
Get ready, get set . not yet! The latest filings announced during the last week include:

Comverge

• Proposed ticker: Nasdaq: COMV
• Industry: Clean-energy solutions provider
• Proposed deal terms: Not yet determined
• Lead manager: Citigroup
• Filed: Oct. 5

Dayton Superior Corporation

• Proposed ticker: Nasdaq: DAYT
• Industry: Construction products provider
• Proposed deal terms: Not yet determined
• Lead manager: Robert Baird
• Filed: Oct. 4

Home Inns & Hotels Management

• Proposed ticker: Nasdaq: HMIN
• Industry: Chinese hotel operator
• Proposed deal terms: Not yet determined
• Lead managers: Credit Suisse, Merrill Lynch, and Deutsche Bank
• Filed: Oct. 4

Disabled list
Alsius Corporation, a medical device maker, announced the withdrawal of its offering due to its upcoming acquisition by Ithaka Acquisition Corporation (ITHK.OB).

Current champions
Meet our current 2006 champs. Among companies that went public this calendar year, these firms' percentage returns from their offer prices to last week's closing price rank them as the top five players:

Current benchwarmers
Now meet our current 2006 benchwarmers -- that's nicer to say than "losers," isn't it? Among companies that went public this calendar year, these firms' percentage returns from their offer prices to last week's closing price rank them as the bottom five players:

Groupies & fan clubs
If you don't want to declare your loyalties to specific players, but still want to enjoy the action, consider subscribing to an IPO-focused mutual fund or exchange-traded fund. Of course, do your scouting homework here, too, and make sure you read their prospectuses before buying season tickets.

Last week, the IPO Plus Aftermarket (IPOSX), a mutual fund, gained 2.1%, while the First Trust IPOX 100 (FPX), an ETF, rose 2.3%. Both IPO-focused investments beat the broader market, with the Nasdaq increasing 1.8% and the Russell 2000 posting a 2.0% advance.

Keep reading the Fool to see how your favorite players perform as they mature!

We're publicly offering further Foolishness:

• The IPO Lock-Up Period

Sources: Renaissance Capital's IPOhome.com, SEC filings, Reuters.

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Fool contributor S.J. Caplan roots for the Cleveland Indians when her husband is watching, and for the Boston Red Sox when he leaves the room. She holds no financial position in any firms or funds mentioned here. The Fool has a disclosure policy.