Shares of Web-hosting company GoDaddy Inc. soared nearly 31% in their first day of trading on Wall Street, another sign of strength in the tech sector in an otherwise lackluster stock market.
Investors pushed the share price to $26.15 Wednesday from its $20 initial public offering price. The closing price values the company at nearly $4 billion. The stock, trading under the symbol GDDY on the New York Stock Exchange, hit a high of $26.84 during trading.
The Scottsdale, Ariz., company, perhaps best known for its racy television ads, jacked up the number of shares it offered to 23 million, a million more than it had planned, because of strong market demand. It raised more than $460 million in the IPO.
The IPO comes as the company is engaged in the tricky task of overhauling its flamboyant image, cemented by its edgy Super Bowl commercials featuring supermodel Bar Refaeli and race car driver Danica Patrick.
The company now wants to be seen as a serious and reliable provider of Web hosting and other Internet services for the hotly contested small-business market.
In its offering statement filed with the Securities and Exchange Commission, the company included a lengthy statement of risks to the stock:
“Some of our past advertisements have been controversial,” it said. “There can be no assurance that we will succeed in repositioning our brand, or that by doing so we will grow our total customers, increase our revenue or maintain our current high level of brand recognition.”
The strong reception to the stock's debut comes as the tech-heavy Nasdaq index, once known for its volatility, recently crossed the symbolic 5,000-point threshold. Most analysts see little or no sign of a bubble, and many expect continued profit growth.
For the day, the Nasdaq lost 20.66 points, or 0.4%, to 4,880.23. It is up 3% so far this year; the broader Standard & Poor's 500 is barely positive this year, and the blue-chip Dow Jones industrial average slipped into the red year to date.