LinkedIn stock skyrockets on market debut
Social networking site's stock had more than doubled by midday.
By The Associated Press
LinkedIn's stock more than doubled in its market debut Thursday because of huge investor demand for the first major U.S. social networking company to go public.
The stock traded at $103 at midday under the symbol "LNKD" on the New York Stock Exchange. That puts the company on track for one of the biggest first-day gains of 2011.
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Only Chinese online security company Qihoo 360 Technology (QIHU) has closed higher, ending up 134.5% when it debuted on March 30. At $103, LinkedIn's gain at midday was 129%.
The last time a U.S. company more than doubled in an IPO debut was Nymex Holdings Inc. in November 2006, according to Dealogic. Nymex, which operated the New York Mercantile Exchange, was acquired by CME Group (CME) in 2008.
LinkedIn Corp.'s initial public offering Wednesday night was priced at $45 per share, at the high end of the company's initial target. The company raised $353 million in an IPO that valued it at $4.3 billion. That's the largest valuation for a U.S. Internet company since Google went public in 2004.
The demand reflects investors' belief that Internet services that connect people with common interests will be able to make more money as the Web's audience steadily expands. LinkedIn's valuation eventually may look modest compared to other Internet companies that are being touted as potentially going public in the next 18 months. The short list includes: online messaging service Twitter, Web game maker Zynga, coupon site Groupon and Facebook, the social network that boasts more than 500 million users.
IPO analyst Scott Sweet, the founder of IPO Boutique, said Thursday's market debut was a good sign for those other social-networking companies.
He credits the increase to LinkedIn selling a relatively small number of shares, 7.8 million. Main Street investors clamored for the job networking site's stock, which had only been available to the country's biggest mutual funds, pension funds and other major institutional investors in Wednesday's IPO.
The company's service helps businesses find new employees and promotes networking among the more than 102 million people that have set up profiles.