The shares began trading at 10 a.m. ET, and quickly jumped to nearly $26 a share before losing a bit of steam.
But only a bit: Shares still closed up 31% for the day by the end of the regular trading session, at $24.89.
Late Thursday, shares of the Miami-based operator of 11 cruise ships were priced at $19 a share, signaling a strong reception from investors. The pricing was well above the expected range of $16 and $18 a share.
The deal raises $447 million for the company, since it sold 23.5 million shares. It will trade under the ticker "NCLH" on the Nasdaq electronic exchange.
The stock's sharp rise reflects investors' hopes that the company may be a source of growth. Since Norwegian is smaller than Carnival, which has 99 ships, and Royal Caribbean with 39, investors think incremental growth prospects are better at Norwegian.
Investors are currently paying a price-to-revenue valuation of 2.3 for Norwegian, which is even higher than the 2.0 price-to-revenue paid on market leader Carnival. That's a bit surprising since Norwegian has $2.7 billion in long-term debt, a heavy relative load for its size compared with the $7.2 billion carried by Carnival.
But despite the strong performance of Norwegian, it's important to note that the company still sports a market value of $5.3 billion, which is nowhere near the $30.1 billion value of Carnival and $7.9 billion value of Royal Caribbean.
No comments:
Post a Comment