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MARKET COMMENT
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This year's stock market rebound has done little to encourage companies to float. To the end of November, 159 new businesses, which raised £2.3b, were admitted to the London market. Contrast that to the bear market years of 2002, when 228 new issues raised £5.2b, and 2001, when 304 flotations raised £6.6b. Nevertheless, quality rather than quantity has been 2003's new issue theme. For instance, Yell (LSE: YELL), valued at £2b and the year's biggest float, is certainly a FTSE 100 company worth inspecting. Recent results showed sales up 7% and operating margins at a healthy 20%. The publisher of Yellow Pages and various equivalents in the US has seen its shares rise from July's 285p issue price to 301.5p. Read more | more. Tech investors may wish to investigate the fast-growing Wolfson Microelectronics (LSE: WLF). Somewhat astonishingly, a trading update last month confirmed 2003 sales growth would outrun the 100% improvement seen in 2002. Wolfson shares have since rallied from a 210p issue price in October to 285p. Read more | more. Meanwhile, oil services firm Sondex (LSE: SDX) has seen its shares gush from a 100p issue price in June to 151p. November's results informed of sales up 27% and robust operating margins of 24%. Valued at £60m, Sondex looks to be a decent small-cap growth share. Read more | more. Naturally, 2003 has seen issues of a lower quality. New listings where shareholders will be relying on crossed fingers rather than proven business models include 'the next PizzaExpress' Clapham House (LSE: CPH), property services specialist Erinaceous (LSE: ERG), oil explorers Faroe Petroleum (LSE: FPM), condom experts Futura Medical (LSE: FUM), ring tone supplier Monstermob (LSE: MOB) and fledgling trading platform Ofex (LSE: OFX) Of course, the present flotation drought is in stark contrast to the new issue flood seen in early 2000. In retrospect, that was a good time to be selling shares, and in particular, the numerous techs that were coming to the market. The current flotation dearth doesn't necessarily mean investors should be filling their boots, but the fact that many well-informed company owners are not floating their businesses suggests now is not generally the time for selling.