Petrie Parkman & Co. IPO: Banking on Strong Revenues

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Petrie Parkman Sets IPO, Aiming for $115 Million

  • Summary: Investment-banking boutique Petrie Parkman & Co. (NYSEARCA:PDP) announced plans to sell partial equity through an IPO, planning to raise up to $115m. The company raises capital for energy-industry corporations. There has been a recent wave of energy-industry mergers and public financings, some of which the company has been a part: They were Western Gas Resources' (formerly WGR) advisor in their $5.3b merger with Anadarko Petroleum Corp. (NYSE:APC). It was a co-manager in the $141m IPO of refiner Calumet Specialty Products Partners LP (NASDAQ:CLMT). The industry's have been largely successful: Thomas Weisel Partners Group Inc. (TWPG) rose 33% in its first day of trading (presently it's only 4% above IPO price). Evercore Partners Inc. (NYSE:EVR) went up 18% (now 45%). Petrie Parkman's revenue was up 79% in the first half of this year to $62.3m (largely due to its participation in industry mergers).
  • Comment on related stocks/ETFs: Kris Tuttle points out that Petrie Parkman's high compensation overhead (avg. $1.2m/employee) drained its otherwise healthy revenue growth in the first half of 2006; the value in investing in such a company, or lack thereof, will depend on their ability to grow revenues through high investment activity. See highlights of Petrie Parkman's S-1 filing, and Bill Simpson's in-depth analysis of Evercore's recent IPO, and comparison to other investment banking IPOs this year.