By Steve Gelsi, CBS.MarketWatch.com, December 27, 2004
NEW YORK (CBS.MW) -- As a specialist in sifting through initial public offerings for the Renaissance Capital IPO Plus Fund, Linda Killian had a bigger canvas to work with in 2004.
All told, 252 common stock IPOs kicked off in 2004 for proceeds of $46.8 billion, up sharply from 80 deals that raised about $14 billion in 2003, according to IPO tracking firm Dealogic.
Killian, manager of the $25 million Renaissance IPO Plus Fund (IPOSX), said she keeps her eye on a variety of sectors that contributed to the recovery in initial public offerings this year.
As of Dec. 20, the fund posted a year-to-date gain of 9.5 percent, ahead of the 6 percent return for the Nasdaq ($COMPQ) and the 7 percent return from the S&P 500 ($SPX), but below the gain of 14 percent from the Russell 2000 ($RUT).
In 2003, the fund rose 52 percent, compared with a gain of 45 percent for the Russell 2000.
In 2002, the fund fell 21.5 percent, compared with a 20.5 percent loss by the Russell 2000.
Killian’s top pick is Navteq (NVT), a maker of software for global positioning systems.
“It’s the undisputed leader. ... They’re head and shoulders above every other player,” she said. “As the cost goes down, everyone will have GPS devices on their car and even on handheld devices.”
DreamWorks Animation (DWA) also drew Killian’s praise as a way to tap into the growing popularity of animated pictures.
“DreamWorks and Pixar (PIXR) have developed a wonderful formula for developing entertaining movies,” she said. “Hollywood is hit-driven, and these companies seem to have a much higher probability of success with animated pictures.”
She added that she’s bullish on the prospects for DreamWorks’ upcoming spring release, “Madagascar,” after seeing clips from the movie during the studio’s IPO road show.
Finally, Killian said PortalPlayer (PLAY) is attractive because of its role supplying technology to digital music players such as the iPod.
“The iPod is a hot gift this holiday season. That market is just beginning to be appreciated. It’s only a matter of time before older folks start getting them.”