Chicago Board of Trade in Public Offering
CBOT Holdings Inc., operator of the Chicago Board of Trade, the nation’s No. 2 futures exchange and a key trading floor for agricultural commodities, will become a hot commodity in its own right when it goes public Wednesday.
The CBOT’s initial public offering will be one of the most closely watched of 2005.
“There could be lots of aggressive buying on the first day to run the stock up,” said Sal Morreale, an institutional salesman at Cantor Fitzgerald. “When you get a stock like this that is having such a huge amount of hype even before it goes public, people tend to jump on the bandwagon and pay the wrong price.”
At a forecast value of about $150 million, based on the midpoint of its anticipated price range of $45 to $49, the CBOT’s 3.2 million shares will not be an overly large offering. The average U.S. IPO this year comprised 11.5 million shares and raised $174.5 million, according to Dealogic.
Measured by price to book value, the CBOT’s shares would be cheaper than those of some of its largest competitors, according to Francis Gaskins, president of IPO Desktop, an independent research company that tracks IPOs.
He calculated the CBOT’s price-to-book ratio at 5.4.
By way of comparison, that measure is 14.1 for Nasdaq Stock Market Inc. and 11.7 for the Chicago Mercantile Exchange.
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The Week Ahead
Today
* Quarterly earnings reports expected from General Motors and Mattel.
Tuesday
* The Labor Department issues its producer price index for September.
* Quarterly earnings reports expected from Intel and Yahoo.
Wednesday
* The Commerce Department releases the September housing starts report.
* The Federal Reserve issues its “beige book,” a detailed regional assessment of the nation’s economy.
* Quarterly earnings reports expected from EBay and Amgen.
Thursday
* The Conference Board reports its index of leading economic indicators.
* Quarterly earnings report expected from Google.
