Shares of Palo Alto Networks and Kayak Software both registered strong gains Friday as they made their debut.
SAN JOSE, CALIF. - More than two months after Facebook's much-hyped initial public offering led to a botched first day of trading and a descending stock price for the world's most popular social network, Wall Street's IPO business seems to be returning to health.
Two tech companies debuted in the market Friday, double the number of major tech companies that have traversed the IPO process since Facebook, and both saw shares jump in the first day of trading.
Only four companies total went public in the entire month of June. But two companies made their debut on Thursday, and two tech companies followed the same route Friday.
Network security company Palo Alto Networks follows a formula that has been consistently popular with investors in the past year: Develop a strong enterprise software offering, and quickly grow your revenue.
The company certainly behaved as if its IPO found a strong following during its road show, increasing the price range for shares Wednesday, then pricing its shares even higher on Thursday, at $42 apiece.
After pulling in more than $260 million at a valuation of roughly $2.8 billion, the Santa Clara, Calif., company debuted Friday with a huge initial pop, opening 31.3 percent higher than its IPO price on the New York Stock Exchange.
Its shares ended the day up about 27 percent at $53.13.
Kayak Software is a consumer-facing technology company, a sector that has been hit-and-miss with investors and could be more affected by Facebook's weakness than enterprise software. But it found strong gains Friday, closing almost 28 percent higher at $33.18.
Kayak, like Palo Alto Networks, priced its IPO higher than it first thought, charging $26 a share after initially suggesting a range of $22 to $25. Kayak's share sale brought in $91 million, at a valuation of roughly $1 billion.