Updated from 2:11 p.m. EDT

Salesforce.com

(CRM) - Get Report

became the top opening day performer among tech IPOs this year as the software maker enjoyed a warm reception from eager investors.

After pricing higher than its expected range at $11, Salesforce.com quickly soared to more than $15 and stayed there much of the day. The stock then surged again in the final hour along with the broader market, trading as high as $17.30 before closing up $6.20, or 56.4%, at $17.20. The stock was the Big Board's top percentage gainer of the session and one of the top 20 volume leaders with more than 10.8 million shares changing hands.

Salesforce's advance bested the previous top one-day tech performer,

Blackboard

(BBBB)

, which racked up a 43% gain on its first day of trading, according to Thomson First Call. (

Jed Oil

(JDO)

was the top overall one-day IPO performer this year, more than doubling to close at $11.20 on April 6 after being priced at $5.50.)

"Did

Salesforce live up to expectations? The pricing told us all we needed to know, and then the market confirmed it, plus a little sugar frosting at the end," John Fitzgibbon, editor of the IPO Web site 123jump.com, said after the market closed Wednesday.

But while its strong showing may bring back some distant memories of the dot-com days, Fitzgibbon said forget it. "It's not irrational," he said. "

If they priced this one a couple years ago, this one would have been up 300% to 400%."

While certainly upbeat about the stock's performance, investors also seemed to be taking a more measured view that that during the dot-com boom.

"I'm quite happy with how it's worked today so far," said Steve Roth, an analyst with the

(NTTFX)

John Hancock Technology fund, which received an allocation of the IPO. "We were expecting it to do well out of the gate."

Amid the stock's jump, Roth said the fund plans to hold onto its shares and re-evaluate its assumptions and the street's view of the company.

Tuesday evening, underwriters for San Francisco-based Salesforce sold 10 million shares to raise $110 million in one of the most highly anticipated tech IPOs of the year outside of

Google

. The stock began trading Wednesday on the

New York Stock Exchange

under the ticker CRM.

Like Roth, Tony Ursillo, an analyst with Loomis Sayles & Co., said his firm also intends to hold onto its IPO allocation. "It's not like Salesforce tripled," he said. "Unless the valuation is so stretched along those lines, we're going to try to keep a little bit longer-term perspective."

Ursillo said Salesforce's attraction includes its subscription business model, which he says creates more revenue consistency, and the small and medium-sized enterprise market that the company is targeting, which Ursillo calls "pretty underpenetrated."

Yet he is not troubled by the company's small profits. "Google is not the norm," Ursillo said of the strongly profitable search engine. "Obviously the excitement is being able to hopefully buy a company that is small and gets bigger."

The fact that there have been only around 16 tech IPOs this year is another reason for the stock's pop Wednesday, said Richard Peterson, chief market strategist at Thomson Financial. Salesforce was only the 11th IPO this year to price above the high end of its range, out of 88 total deals, he noted.

A day before going public, Salesforce increased its proposed initial price range to $9 to $10 from $7.50 to $8.50 previously -- a signal of a strong reception confirmed by Tuesday evening's pricing and Wednesday's jump.

"The pricing of it ... is advertising to the world this is one hot deal," Fitzgibbon said Tuesday. "Silicon Valley out there is hanging by the thumbnails looking to see how this one is going to go."

Fitzgibbon correctly noted that the higher price foreshadowed a bigger pop on the stock's first day of trading. He noted that on average, IPOs that have priced above their range this year gained an average of 25% on the first day of trading -- compared to a nearly 5% increase for stocks that priced below their range.

But Fitzgibbon reiterated that Salesforce is no throwback to the dot-com days. That's underscored by its financials, business model and the fact it will be trading on the Big Board, he said.

"You're having a solid company with a proven business plan generating escalating revenue and profits," he said. "This is a far cry from some 23-year-old kid with some wild-eyed concoction that they run public with, with no revenue and millions of

dollars of losses."

Salesforce.com, which sells hosted CRM software delivered via the Internet, reported an 88.3% increase in revenue to $96 million in fiscal year 2004, which ended Jan. 31. The year also was its first profitable one, with net income of $3.5 million, or 4 cents a share, compared with a loss of $9.7 million, or 37 cents a share, in fiscal 2003.

However, $3.4 million of that came as a result of leasing out property on which the company had previously canceled a long-term lease. If not for this reversal in lease charges, Salesforce would have lost a penny vs. gaining 4 cents in the third quarter of 2004, according to Fulcrum analyst Jamie Friedman.

Although Salesforce.com is much smaller than its major conventional rival --

Siebel Systems

(SEBL)

-- it already has forced the older company to sell a cheaper, Web-based version of its software. In fact, more and more software companies are adopting the subscription-based model Salesforce.com uses, including

Red Hat

(RHAT)

,

Mercury Interactive

(MERQ)

, and even industry titan

Microsoft

(MSFT) - Get Report

The underwriting syndicate was led by Morgan Stanley, Deutsche Bank Securities, UBS Investment Bank, Wachovia Securities, and William Blair & Co.