Street takes to Tivo
Stock up $13 in 1st day; analysts expected more
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Investors sent shares of the Sunnyvale, Calif.-based company soaring 162% early Thursday morning, opening at $42, but the stock ended up falling, closing at $29.94 -- a healthy gain of 87%.
Firm valued at $1.6 bil
The day's trading gave the upstart a market value of $1.61 billion.
TiVo sold 5.5 million shares at $16 each Wednesday -- up from the expected IPO price of $11-$13 -- raising $88 million. The sale represented a 15% stake in the company. Credit Suisse First Boston served as lead underwriter.
Analysts, however, expected TiVo to perform better than it did, saying the company "zoomed out of the gate and gave it all back."
TiVo is a subscription-based service that enables viewers to digitally record programming as well as pause and rewind live TV through a set-top box.
"This is not an Internet stock, per se, it's a TV stock, which is a little less exciting to the Wall Streeters and the day traders of the world," said Bruce Kasrel, senior analyst at Forrester Research in Cambridge, Mass.
TiVo's service could eventually prove more enticing to Wall Streeters than many Internet stocks, however, as there are 98 million households with TV sets and only 50 million with PCs.
Close competitor Replay Networks has not yet gone public.
