Shares in the audio and video Internet broadcaster more than triple in its first day of trading.
Broadcast.com began trading this afternoon at $18 per share and quickly rose as high as $74. The stock closed at 62.75, up nearly 250 percent. The company's market capitalization now stands at more than $1 billion.
The company sold 2.5 million shares, raising $45 million, with 16,883,451 shares outstanding. The lead underwriter, Morgan Stanley Dean Witter, had anticipated a selling price ranging between $14 a share and $16 a share.
"It's pretty amazing that it opened so high," said Ken Fleming, a research analyst with the Renaisannce Capital IPO Fund. "It's tough to value Internet companies in general, and this is no exception."
Fleming said it will continue to be difficult to forecast the success of the young company.
"Like most Internet companies, they have a pretty small revenue base and they expect losses for the next few years," he said.
Broadcast.com's IPO comes as another half-dozen technology companies also are preparing to go public, including online community site GeoCities, e-commerce retailer Cyberian Outpost, and Web-hosting services company Hiway Technologies. eBay, an online auction site, filed IPO papers with regulators on Wednesday.
This year, the stock price of some Internet-related companies more than doubled on their first days of trading, including search engine company Inktomi, and Broadcom, a maker of chips that help deliver Internet access to television screens via cable lines.
But some have had false starts. Push technology pioneer PointCast, for example, said on Wednesday that it is withdrawing its plans to go public in order to hold discussions about a strategic alliance with potential partners.
Broadcast.com (formerly AudioNet) reported 1998 revenues of $3.1 million as of March 31, and a net loss of $2.7 million. In 1997, the company reported a loss of $6.5 million on revenues of $6.9 million. A year earlier, it posted a loss of $3 million on revenue of $1.8 million.
Broadcast.com is trading on the Nasdaq under the symbol "BCST." The managing underwriters of the offering are Morgan Stanley, Donaldson, Lufkin & Jenrette Securities, and Hambrecht & Quist.