RADVision shot up 39 7/8, or 199 percent, to 59 7/8 Tuesday in its initial public offering after pricing its shares at $20 a piece.
RADVision, based in Israel, had bumped up its price range from an original filing range of $11-13 per share.
"This is the holy grail of networking," Kenan Pollack of IPO Central said of RADVision's business. The company's Internet Protocol, or IP-based technology enables customers to migrate their voice and video communications from telephone networks to next generation packet networks.
"This company can bring it all together. That's potent stuff," Pollack said. Lucent (NYSE: LU) and Cisco (Nasdaq: CSCO) are working on the same technology, he added.
The use of packet networks for real-time voice, video and data communications is expected to grow dramatically. According to ICM Global Intelligence, a market research firm, revenue for network equipment associated with voice-over-IP, or IP telephony, will grow from $477 million in 1999 to $7.1 billion in 2004.
For the year ended Dec 31, RADVision had a net loss of $2.7 million on revenue of $17.6 million, as opposed to a loss of $829 000 on revenue of $8.9 million in 1998.
RADVision's cutomers include Alcatel (NYSE: ALA), Cisco Systems (Nasdaq: CSCO), Nortel Networks (NYSE: NT), and 3Com (Nasdaq: COMS).
RADVision's competitors include Ezenia! (Nasdaq: EZEN), formerly known as Video-Server, White Pine Software (Nasdaq: WPNE) and the in-house developers of telecommunications equipment and systems makers. Other companies, including Accord Networks; DataBeam, a subsidiary of Lotus/IBM; DynamicSoft; Elemedia, a subsidiary of Lucent; and Trillium Digital Systems have announced products that may compete with its offerings, the company said.
Lehman Brothers is the lead underwriter for the offering. Salomon Smith Barney, U.S. Bancorp Piper Jaffray and Fidelity Capital Markets are serving as co-managers.