RPT-IPO VIEW-IPO stocks get thrashed by markets

(Repeating item that initially moved late Friday)

By Phil Wahba

NEW YORK, Sept 21 (Reuters) - Last week's battering of the stock markets not only slammed companies once thought of as stable, blue-chip stocks, such as financials, the markets were also merciless toward the stocks of newly public companies as investors fled to the safest securities they could find, further putting off the long-awaited recovery of the initial public offerings market.

So far this year, according to IPO Index, a benchmark by Connecticut-based research firm Renaissance Capital that tracks U.S. IPOs from the past 24 months, IPO stocks are down nearly 29 percent. That compares with the Standard and Poor's 500 .SPX decline of nearly 15 percent year to date. A week ago, the IPO Index was down only 25.3 percent.

"Investors found it safer to throw them out and move to higher ground," said Kathleen Smith, chairwoman of Renaissance Capital, of the battered IPO stocks.

Newly public stocks are typically more volatile than the broader market because there are relatively few of their shares in the market and because of investors' lack of familiarity with them.

The current year has only seen 30 IPO launches in the United States, raising $26.7 billion in proceeds, making it the slowest IPO market in five years, with only about a quarter of the activity at this point last year, according to Thomson Reuters data.

Of those 30 new issues, only six have had positive returns since their launch.

Two of those top performers, credit-card operator Visa Inc (V.N), up 58 percent since its March debut, and risk consultant RiskMetrics Group Inc (RMG.N), once a unit of JP Morgan Chase and Co (JPM.N) and up about 39 percent since January, were already well known to investors.

Among the most volatile stocks has been GT Solar International Ltd (SOLR.O), the maker of solar equipment, which launched a $500 million offering in July. On Friday, it was down about 28 percent from its launch, but had been down as much as 48 percent earlier in the week.

IPO'S WILL HAVE TO WAIT

The week's wild ride on the markets is likely to further delay a resurgence in the IPO market, which has been moribund since last November, Smith said.

"Issues can't be done when the markets are collapsing," Smith said.

In what would be the first stock flotation in the United States since early August, Fluidigm Corp, a California-based provider of systems to optimize laboratory functions, had planned to price its IPO on Thursday, but had to postpone and will to try again this week.

The biggest problem for prospective offerings in a rocky market is the difficulty of getting their stories out to investors, analysts said.

"Fewer people are willing to take on new positions when they see their core stocks being eviscerated on a daily basis," said David Menlow, president of IPOFinancial.com.