Newly minted shares of BigCommerce Holdings (BIGC) were off to a rousing start Wednesday, as the initial public offering soared by triple digits out of the starting gate in midday trading. The BigCommerce IPO raised $216.5 million, above expectations.
XBigCommerce stock soared 201%, closing at 72.27 on the stock market today.
The e-commerce specialist priced 9.02 million shares at $24, above its estimated price range of $21 to $23. It originally planned to offer 6.85 million shares in a range of $18 to $20.
BigCommerce provides a cloud-based platform used by businesses to create online stores. The platform helps launch and scale e-commerce operations, including store design, catalog management, hosting and checkout.
"Our software-as-a-service platform simplifies the creation of beautiful, engaging online stores by delivering a unique combination of ease-of-use, enterprise functionality, and flexibility," said the BigCommerce IPO filing. "The transition from physical to digital commerce constitutes one of history's biggest changes in human behavior, and the pace of change is accelerating."
BigCommerce Compared To Shopify
Austin, Texas-based BigCommerce draws comparisons to Shopify (SHOP), a top-performing stock that held its IPO five years ago and has soared in value since then.
BigCommerce helps manage some 60,000 online stores across industries worldwide. Its customers include Avery Dennison (AVY), Ben & Jerry's and Sony (SNE).
In 2019, the company reported revenue of $112.1 million, up 22% from the prior year. It showed a net loss of $42.6 million vs. $38.9 million.
First-quarter revenue jumped 30% to $33.2 million, with a net loss of $4 million, vs. $10.5 million.
BigCommerce IPO Gets Top Rating
Research and advisory firm IPO Boutique is giving the BigCommerce IPO its highest rating of 5. It says the offering is "many times oversubscribed," suggesting strong demand for shares by institutional investors.
"This company's financials are very good with strong growth and improving gross margins," IPO Boutique said in a note to clients.
Lead underwriters are Morgan Stanley, Barclays and Jefferies. In addition, investment firm Tiger Global Management has indicated it is interested in purchasing up to 20% of the shares in the offering.
In addition to the BigCommerce IPO, also newly trading Wednesday was cloud company Rackspace Technology.
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Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.
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