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IPOs take Wall Street by storm

Thursday, April 16, 2015 - 02:10

Etsy, Party City and Virtu Financial shares were all the rage on their first day of trading, as investors clamored for the new offerings. Bobbi Rebell reports.

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Investors cheered a trifecta of new offerings on Thursday. Online handmade goods and crafts seller Etsy, party goods retailer Party City, and high speed trading firm Virtu Financial. Renaissance Capital's Kathleen Smith: SOUNDBITE: KATHLEEN SMITH, PRINCIPAL, RENAISSANCE CAPITAL (ENGLISH) SAYING: "The IPO market has been a bit slow in terms of activity. Returns have been good, and now we have this sort of lift off. I think we are going to see good performance from IPO's with these deals." Etsy stock more than doubled in its debut trading session. That valued the money-losing company at about $4 billion. Reuters Correspondent Liana Baker: SOUNDBITE: LIANA BAKER, REUTERS CORRESPONDENT (ENGLISH) SAYING: "I think there is a lot of competition in e-commerce and Etsy has carved out a nice area, dealing with small sellers of products Baker says there's even buzz about a takeover: SOUNDBITE: LIANA BAKER, REUTERS CORRESPONDENT (ENGLISH) SAYING: "I cover M&A, and there is always speculation when companies go public, that they could take it a dual track and be acquired instead. I think, with Etsy coming out and the valuation in the low billions, it could make it ripe for picking by a bigger company like eBay or Amazon." Shares of Party City surged as well jumping as much as 22 percent. It is the largest U.S. party goods retailer with 900 superstores. It has managed to hold off rivals like Wal-Mart and Target by focusing its merchandise on themes and events. Electronic trading firm Virtu Financial's shares surged around 25 percent during their first session. That's a sign that the public angst over regulations and high frequency trading - those rapid fire, high volume transactions it specializes in - are fading. SOUNDBITE: KATHLEEN SMITH, PRINCIPAL, RENAISSANCE CAPITAL (ENGLISH) SAYING: "This is one of the significant companies in the high frequency market making business and its diverse across asset classes across regions and most importantly I think to investors with this is they are going to have a dividend of about 5 plus percent paid to investors so a great deal of the earnings for Virtu will be paid out to investors." Virtu had postponed its offering last year after the release of "Flash Boys." That best seller by Michael Lewis questioned whether the markets were rigged in favor of high frequency traders.