Trulia is heating up the market with its debut Thursday, as the company’s stock, at the market’s open, popped over 30 percent from its initial offering price of $17. And then, kept going.
The online real estate listing company’s 6 million shares opened at $22.10 per share. As of 2 p.m. Eastern, the stock was priced at $24.95, up over 46 percent from the market’s open.
Early investors are likely hoping the stock will see the same long-term success as Trulia competitor Zillow, which had its IPO in July 2011.
On its debut day, Zillow shares more than doubled in early trading, then settled a bit but remained well above the IPO mark of $20 per share. The company’s growth and strong margins have made it an attractive stock to investors, according to a Wednesday report on Daily Finance by Dan Caplinger of The Motley Fool. On Thursday at 2 p.m., Zillow was trading at $46.21.
Both Zillow and Trulia have fared better than other recent Web firms, such as Facebook and Zynga, did in their first days as publicly traded companies, perhaps indicating that the value of the specialized content and the reliable revenue from subscription fees seem like a surer bet to investors than the solely ad-driven revenue from social networks.
The real-estate companies have done better, too, than online service sites with user-submitted content such as Yelp or Angie’s List, which have been up and down since their respective debuts. Yelp, which went public in March, has recovered from dips to trade consistently above its IPO price this week. Angie’s List has been trading below its IPO price of $13 per share for a couple of months, and its stock took another slide this week when a post-IPO stock lockup expired.
Trulia’s stock could, perhaps, look more like that of the travel search site Kayak. One of the first major initial public offerings to hit after Facebook’s debut, Kayak’s findings stand out because it compiles and organizes information put out by professional sources. Kayak recently reported its first post-IPO earnings, with $76.9 million in revenue. On Friday, it was trading at $32.77 per share, up from its IPO range of $21 to $25.
Those looking at Zillow and Trulia could also be encouraged by the most recent figures released by the National Association of Realtors Wednesday.
According to The Washington Post, existing home sales are up 7.8 percent to a seasonally adjusted annual rate of 4.82 million homes in August. Construction is also up, though slightly less than expected, boosted by single-family housing starts, which are up 5.5 percent for a seasonally adjusted rate of 535,000.