Bridgepoint IPO Priced Low, but Shares Rise

Bridgepoint Education (BPI Quote) saw its initial public offering, or IPO, price 30% below the midpoint of its estimated range, although investors are still hoping to see the same high returns as other recent offerings.

The San Diego-based provider of online and classroom education services expected to price a $216 million IPO in range to $14 and $16 a share, but the offering ultimately priced at $10.50 a share, raising only $141.75 million. The stock began trading Wednesday morning on the New York Stock Exchange under the ticker symbol BPI.

While the lower-than-expected pricing could be considered a setback for an already-struggling IPO market, all hope is not lost.

For one, Bridgepoint shares were lately up 9.5% at $11.50. That's better than rival Grand Canyon Education (LOPE Quote) fared on its first day of trading. Before Grand Canyon's IPO priced in November, it had to cut its price range only to see a first day return of negative 1.3%. Since then, Grand Canyon shares have seen a return of more than 20%.

If Bridgepoint's gain holds through the end of the session, it will mark yet another strong return in what has been a very difficult environment. Among the other winning IPOs, Chinese video game maker Changyou.com Limited (CYOU Quote) priced its IPO on April 1 at $16 a share. The stock is now at $26.60 a share, good for nearly a 70% increase, according to Renaissance Capital, which operates the Web site IPOHome.com.

Mead Johnson Nutrition (MJN Quote), the Evansville, Ind.-based baby-formula maker, saw a first-day return of 10.1% after it priced its IPO at $24 a share on Feb. 10. Currently, the stock has a return of 10.4%.