Open Solutions Jumps 12% on First Day of Trading

There is strength in small deals, as evidenced by Wednesday's five-million-share IPO from Open Solutions(OPEN Quote).

The software company's stock was lately up $2.15, or 12.7%, to $19.20 on its first day, bucking a downward trend for new issues this week. Larger offerings from van line company Sirva (SIR Quote) and regional carrier Pinnacle Airlines(PNCL Quote) fell below their issue prices on their debuts.

"Investors are showing how they feel about the IPO market. They do not want to be force-fed large issues," said David Menlow, president of IPOFinancial.com.

Open Solutions is only the second software deal of the year following Callidus(CALD Quote) last week, which also had a strong reception.

Shares of Open Solutions priced at $17 a share, above its proposed range of $14 to $16 a share. The company received more than $70 million in venture capital money from various investors. It turned profitable in the first nine months of 2003, earning $1.6 million, after three years of losses.

While Open Solutions' performance was better than most other first-day showings this week, Menlow said he was surprised, given the pricing, that the deal did not do even better. "This is an indication that there are fewer participants in the market this holiday-shortened week."