Digital and technology company Trade Desk Inc. (NASDAQ:TTD) became a publicly traded company on Wednesday, fueling the revived market for initial public offerings with a solid opening in its stock market debut.
On Tuesday, Trade Desk issued around 4.66 million shares at $18 apiece, raising $84 million. Shares priced at the high end of its 16-18 range, which had been increased from 14016 as investor demand expanded. The stock opened at 28.75 and ended the session up by more than 67 percent to 30.10 on the stock market.
Trade Desk is currently proposing a maximum aggregate offering price of $96.6 million, higher than the $86.3 million it it projected when its first filed its Form S-1 in August.
The California-based company is a demand-side platform that allows ad agencies acquire digital ads through automated systems. It competes with other digital companies such as MediaMath, Turn and TubeMogul (NASDAQ:TUBE).
Trade Desk manages a digital advertising technology platform for ad customers. Several ad tech stocks have grappled in the past years, but the company is profitable, with revenue soaring 155 percent to $113.8 million last year. According to Trade Desk, revenue climbed 93 percent to $47.2 million in the second quarter of fiscal year 2016.
The digital company is one of three IPOs scheduled for this week in the closely monitored tech sector. The biggest is Appito, which intends to raise $84 million by offering 6 million shares at a price range of 13-15. Appito has started a field called technology business management, which assists chief information officers in running their IT departments. The firm is expected to start trading Friday on the NASDAQ Composite under the ticker APTI.
Gridsum Holding, a Chinese provider of data analysis software that enables customers to gather and analyze massive amounts of data, aims to earn $75 million by providing 6.5 million American depository receipts at 10.50-12.50. Gridsum is set to start trading publicly on Friday.
In the previous week, emergency communications platform Everbridge (NASDAQ:EVBG) valued its IPO at 12. Shares of the company added 27 percent in Friday’s launch. The stock closed Wednesday session up 3.2 percent to 17.55.
Trade Desk IPO Stirs Other Ad-Tech Firms
The recent launch of Trade Desk’s initial public offering sparks optimism for supporters of other ad-tech companies.
The ad-tech market has not been given enough IPOs since MaxPoint Interactive (NASDAQ:MXPT) went public more than a year ago. Moreover, the outbreak of ad-tech companies that went public in 2013-2014 are now mostly underwater as investors penalized companies for having poor business models and not being able to make themselves distinct.
However, hopes that Trade Desk could boost the sector just as Twilio's (NYSE:TWLO) listing did in June for the broader tech sector. “If the Trade Desk IPO goes off successfully, you could see other companies start to dip their toes into the market,” a venture capitalist said.
AppNexus, which allows the programmatic buying and selling of digital ads in real-time, is rumored to be close to filing to go public. Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS) are believed to be leading the proposal, and the company is said to have filed confidential paperwork with the Securities and Exchange Commission about its IPO, according to sources.