STR Holdings Shares Rise In IPO Debut

NEW YORK (AP) — STR Holdings Inc. shares jumped Friday after the solar products company launched its initial public offering, but shares priced below expectations on the New York Stock Exchange.

Shares rose $3.10 from the offering price, or 31 percent, to close at $13.10. They priced at $10, which was below the expected range between $11 per share and $13 per share. A day earlier, the company cut its expected share price from a range of $13 to $15.

Underwriters made the right move by reducing the offering's price to $10, said John Fitzgibbon, founder of IPOScoop. The original price range was overly optimistic and a tough sell, he said.

Fitzgibbon added that bankers will ideally discount an IPO 15 percent to 20 percent against similar companies.

"There's a reason," Fitzgibbon explained. "IPO is a one-day sale." Investors show up when there's a sale and the price is right.

"The underwriters got the price right today."

The offering of 12.3 million shares includes 3.3 million shares offered by STR and 9 million shares offered by selling shareholders. Earlier the company had said STR would offer 2.3 million shares and selling shareholders would offer 10 million shares.