This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

JetBlue in the Clouds on First Day

Updated from 12:32 p.m. EDT

JetBlue's (JBLU - Get Report) IPO soared in its debut of trading on Friday, providing more evidence that the stock market is finally ready for new shares.

The airline stock closed up $18, or 67%, at $45 after being priced Thursday night at $27 a share. That was up from initial price talk of $22-$24 a share.

"The revision was a very good sign of demand," said David Menlow, president of IPOFinancial.com.

The company also upped the number of shares it sold to the public to 5.87 million from 5.5 million on Thursday. At the new price range, JetBlue should raise $158.5 million for the deal. It will use the proceeds for capital expenditures, such as purchasing new airplanes for its fleet.

JetBlue's pop compares to an average first-day gain of 10.5% for IPOs in 2002, with online bill-payment provider PayPal (PYPL), which rose 55% in its debut, an exception.

Still, JetBlue's performance may owe as much to its profitability than to a revival in the IPO market. While the airline industry suffered steep loss in 2001, JetBlue posted net income of $38.5 million.

The carrier's strategy has been to focus on underserved markets in metropolitan areas that have high average fares. In its two-year existence, JetBlue has built a reputation for offering quality service, flying a fleet of new Airbus A320 airplanes and providing free television at every seat.

JetBlue is the first of four planned airline offerings, which include Continental Airline's (CAL) ExpressJet, Northwest's (NWAC) Pinnacle Airlines, and independent regional carrier Republic Airways.

Street hype was not as strong for Ribapharm (RNA), maker of the hepatitis C drug ribavirin, however. Unlike JetBlue, the stock tacked on a more modest 80 cents, or 8%, to $10.80.

Ribapharm priced at $10 a share, well below its $13 to $15 a share range, and raised $260 million.

"The market has been very challenging for the biotech sector, which is off 15% since our road show a few weeks ago" said Johnson Lau, CEO of Ribapharm. "We thought $10 was an appropriate price."

In 2001, Ribapharm had net income of $72 million and sales of $139 million. Lau says he is optimistic about the market for ribavirin: "There are 170 million people infected with the Hepatitis C virus worldwide," he said. "And less than 10% to 15% of them have been treated."

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
JBLU $19.25 -0.57%
RNA $18.65 0.00%
AAPL $124.43 -1.54%
FB $82.22 -1.18%
GOOG $548.00 -0.73%

Markets

DOW 17,776.12 -200.19 -1.11%
S&P 500 2,067.89 -18.35 -0.88%
NASDAQ 4,900.8850 -46.5560 -0.94%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs