Three IPOs surged in first-day trading today as investors responded to yesterday's rally in the Nasdaq, which closed past 4,000 for the third time in the past month.
Triton Network Systems, Network Engines and Sunrise Telecom each jumped more than 100 percent, even after their initial selling prices were boosted yesterday, suggesting strong investor demand.
"A solid Nasdaq always provides a very strong launching pad for the IPO market," said Jeff Hirschkorn, senior market analyst with IPO.com. "When you see a lot of these Internet stocks turn out solid earnings reports, that also helps the IPO market because investment bankers are willing to put out a little more risky deals."
Yahoo sparked a rally in tech shares yesterday after reporting second-quarter earnings of 12 cents per share, 2 cents more than Wall Street expected.
Investor optimism about tech shares continued early today, as shares of Triton Network Systems, which makes equipment to set up high-speed wireless networks, rose more than 180 percent to a high of $43.75 before falling to close at $38.44.
Yesterday, the company raised $82.5 million through the sale of 5.5 million shares at $15 each. Triton increased its price range yesterday to $13 to $15 per share from $10 to $12 per share.
Triton's strong IPO reflects investor enthusiasm for all things wireless. Investors did not appear deterred that the company, founded in 1997, recorded its first revenues in the first quarter of this year. The company posted first-quarter revenues of $3.5 million on losses of $11 million.
Kelly Quinn, a senior analyst for wireless technologies with Boston-based Aberdeen Group, said investors are keen on the wireless field because of its tremendous growth potential.
"The Internet is the Internet, we know what it is," said Quinn, "but wireless is still in its infancy stage. For that reason I definitely think the potential is there for a heck of a lot more growth in the market."
Triton trades on the Nasdaq under the ticker "TNSI." Credit Suisse First Boston handled the sale.
Shares of Network Engines, a maker of specialized Web service appliances, rose 100 percent to $34 before falling to close at $29. Yesterday, the company raised $110.5 million through the sale of 6.5 million shares at $17 each after increasing the price range to $16 to $17 from an earlier range of $13 to $15.
Canton, Mass.-based Network Engines trades on the Nasdaq under the ticker "NENG." Donaldson Lufkin & Jenrette handled the sale.
Shares of Sunrise Telecom, which makes equipment to test digital subscriber line (DSL) systems and Internet networks, soared 169 percent to close at $40.31.
The San Jose, Calif.-based company raised $60 million yesterday, far more than the $48 million it intended to raise. The company priced its shares at $15, $2 above the $11 to $13 range.
Sunrise has posted profits for the past five years, earning $2.8 million in the first quarter of 2000 on revenues of $19 million. The company lists such venerable customers as AT&T and Sprint.
Sunrise trades on the Nasdaq under the ticker "SRTI." Chase Hambrecht & Quist handled the sale.
A fourth IPO showed a moderate gain. Shares of I-Many, which develops business-to-business software for the health care industry, rose 39 percent to close at $12.47
Yesterday the company raised $67.5 million through the sale of 7.5 million shares at $9 each, the bottom of the expected price range of $9 to $11.
I-Many trades on the Nasdaq under the ticker "IMNY." Robertson Stephens managed the sale.