Investors eagerly bought shares of electronic data backup company Data Domain (DDUP) on Wednesday, its first day of trading as a publicly listed company.
Data Domain's shares were recently trading up $8.05, or 54%, to $23.05 after its successful initial public offering Tuesday. Its shares priced at $15 in the IPO, above the estimated range of $11.50 to $13.50.
"Data Domain far exceeded expectations," said Sal Morreale, IPO tracker at Cantor Fitzgerald. Indications looked strong on Friday with investor orders for shares running at four times the 7.4 million shares planned for the IPO, said Morreale. By Wednesday, demand had reached 12 times the planned offering.
Six-year-old Data Domain develops hardware to make electronic data more efficient by avoiding duplication. The disk-based devices help companies and government agencies back up and store data as part of disaster-recovery plans.Disk-based storage has become more affordable as disk prices have fallen over the past five years and have become more competitive with tape-based storage. Companies typically prefer to use electronic storage on disks, because they are much easier and quicker to search than are tapes. Most of Data Domain's customers are small and medium-size businesses for which disk-based data backup has become more affordable. But the company is making headway with larger clients that need to back up information received from multiple remote locations and store it in large data centers.