The San Diego-based company gained $1, or 12.5 percent, to $9, short of its initial $10 to $12 price range. Still, analysts say the stock performed well given the volatility in the broader market.
The Nasdaq Composite Index tumbled 133.61, or 4.2 percent, to 3.097.04 midday, while the Dow Jones Industrial Average fell 51.57, or 0.48 percent, to 10.656.03.
"In the face of what's going on in the rest of the market, I don't think that anybody should be disappointed with Novatel," said Vincent Slavin, who tracks IPOs for Cantor Fitzgerald.
Novatel's modems work with handheld computers made by Palm, Handspring and Hewlett-Packard. The company's Merlin type II modem costs about $230 and runs at 19.2 kbps. The company's Ministrel 540 wireless modem sells for $349.
In the nine months ended Sept. 30, the company lost $30.3 million on revenues of $33.4 million. In the year-earlier period, the company lost $9.5 million on revenues of $5.5 million.
Wednesday evening, Novatel raised $56 million through the sale of 7 million shares at $8 each. Initially, Novatel hoped to raise as much as $84 million, with a price range of $10 to $12 per share. The lowered price range allowed the stock to gain slightly Thursday, analysts say.
"Eight-dollar stocks only do one thing," Slavin said. "They go up."
Novatel trades on the Nasdaq under the ticker symbol "NVTL." Credit Suisse First Boston handled the sale.