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LinkedIn Corp's shares more than doubled in their public trading debut on Thursday, evoking memories of the investor love affair with Internet stocks during the dot-com boom of the late 1990s.
The professional social networking company, which began in one man's living room less than a decade ago, is now worth more than motorcycle maker Harley Davidson Inc and ratings company Moodys Corp.
"I got here at 6 a.m. We've been celebrating since then," one LinkedIn employee said in the parking lot of the company's Mountain View, California headquarters.
"We recognize that there's potentially a bubble right now," said the employee, who spoke on condition of anonymity.
Shares of LinkedIn, which rose as much as 171 percent in their first day of trade on the New York Stock Exchange, closed at $94.25, more than 109 percent above the $45 IPO price.
Bankers typically try to price an IPO so that the stock rises about 15 percent on the first day of trading: enough to reward investors who made a bet, but not so much that the company and original shareholders feel they were short-changed.
Only days ago, LinkedIn proposed a price range for the IPO that valued it at just over $3 billion. Now, after its first day of trade, it is worth nearly $9 billion, adding to concerns that social networking company valuations are out of whack with their earnings potential.
"It seems to bring back memories of the tech bubble," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. "Based on what I know it seems like investors are a little overly enthusiastic."
One hedge fund manager who flipped his holdings in the low-80's described how difficult it was to get shares. "I got 500 shares and was told to consider myself lucky," he said.
"There are billion-dollar institutions that are not getting any stock," he said, recounting something he learned from salesperson at one of the lead banks.
The professional social networking company, which began in one man's living room less than a decade ago, is now worth more than motorcycle maker Harley Davidson Inc and ratings company Moodys Corp.
"I got here at 6 a.m. We've been celebrating since then," one LinkedIn employee said in the parking lot of the company's Mountain View, California headquarters.
"We recognize that there's potentially a bubble right now," said the employee, who spoke on condition of anonymity.
Shares of LinkedIn, which rose as much as 171 percent in their first day of trade on the New York Stock Exchange, closed at $94.25, more than 109 percent above the $45 IPO price.
Bankers typically try to price an IPO so that the stock rises about 15 percent on the first day of trading: enough to reward investors who made a bet, but not so much that the company and original shareholders feel they were short-changed.
Only days ago, LinkedIn proposed a price range for the IPO that valued it at just over $3 billion. Now, after its first day of trade, it is worth nearly $9 billion, adding to concerns that social networking company valuations are out of whack with their earnings potential.
"It seems to bring back memories of the tech bubble," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. "Based on what I know it seems like investors are a little overly enthusiastic."
One hedge fund manager who flipped his holdings in the low-80's described how difficult it was to get shares. "I got 500 shares and was told to consider myself lucky," he said.
"There are billion-dollar institutions that are not getting any stock," he said, recounting something he learned from salesperson at one of the lead banks.