Here's How Smart Investors Made A Killing On IPOs In 2012

Workday NYSE

Photo: NYSE Euronext

2012 turned out to be a very good year for investors who bet on new enterprise-tech companies.This year, companies such as Splunk, Palo Alto Networks, and Workday had extremely successful opening days in spite of the Facebook IPO fiasco—or maybe because of it, as investors veered away from consumer Web plays.

ServiceNow, for instance, was one of the first technology companies to go public after Facebook. It even had the same banker, Morgan Stanley. But its debut couldn’t have been more different: It popped big on Day One, soaring nearly 37 per cent.

How have these tech darlings done since their first day? We looked at 11 stocks and found they were collectively up by 28% over their initial prices. Four of them have market caps well over $2 billion. 

This is an encouraging sign for the enterprise market in 2013.

Epam Systems (EPAM): Sitting pretty with mobile apps

Date of IPO: February 8
IPO price: $12
Shares offered: 6 million

Epam helps enterprises outsource mobile- and cloud-app development to consultants, mostly from Central and Eastern Europe. It grew up serving software developers, but now every businesses needs custom apps, putting Epam in a prime position.

Brightcove (BCOV): Still betting on HTML5

Date of IPO: February 17
IPO price: $11
Shares offered: 5 million

Brightcove is like a YouTube for businesses, letting them host video in customised players. It also makes tools for mobile-app development. Its shares soared on opening day, but it was later hurt when Facebook CEO Mark Zuckerberg talked trash about a key Web technology Brightcove favours for mobile apps known as HTML5. In June, Brightcove introduced a new HTML5 platform for mobile apps.

Demandware (DWRE): Buying the e-commerce trend

Date of IPO: March 15
IPO price: $16
Shares offered: 5.5 million

Demandware's cloud service hosts e-commerce sites. Its IPO popped on Day One, riding the wave of pre-Facebook IPO excitement, when Wall Street was eager for tech stocks. Its founder, Stephan Schambach, had previously started Intershop, another successful e-commerce company.

Splunk (SPLK): The first big-data success story

Date of IPO: April 19
IPO price: $17.00
Shares offered: 13.5 million

Splunk was the first big-data company to go public. Investors jumped on the chance to bet on this tech megatrend, which looks at the new technologies and services required to tackle massive data stores. Splunk's IPO was so hot that trading was stopped on its opening day for a while--but that brief suspension was nothing like the technical mess that fouled up Facebook trading. Enthusiasm has cooled, but the stock is still healthy.

Infoblox (BLOX): Helping enterprise networks grow

Date of IPO: April 20
IPO price: $16
Shares offered: 7.5 million

Infoblox won over investors with tech that keeps networks up and running, even as they connect an ever-growing number of computers, tablets, and smartphones. Although the stock has wavered since its IPO, many analysts still like the company's prospects for growth.

ProofPoint (PFPT): Fighting spam in the cloud

Date of IPO: April 20
IPO price: $13.00
Shares offered: 6.3 million

ProofPoint offers a cloud service for email security. With threats to our inboxes growing, it has a bright future. Its stock price dropped with the expiration of a lock-up on insiders' shares. That happened in October, making 6.9 million more shares available.

ServiceNow (NOW): Curing IT headaches

Date of IPO: June 29
IPO price: $18
Shares offered: 11.6 million

ServiceNow offers a cloud service that helps IT professionals keep their servers and networks up and running. It shocked the tech world with an initial market cap of nearly $2 billion. It's almost doubled since.

Palo Alto Networks (PANW): Keeping hackers away from apps

Date of IPO: July 20
IPO price: $42.00
Shares offered: 6.2 million

Palo Alto Networks makes a security device that is popular with enterprises, a firewall for applications. The company's founder, Nir Zuk, is renowned in the security industry. He was previously an engineer at Check Point, a company which helped create the enterprise networking-security market with its firewall product.

Eloqua (ELOQ): Making marketing easier to track

Date of IPO: August 2
IPO price: $11.50
Shares offered: 8 million

Eloqua is a cloud service that helps companies automate and evaluate their marketing tasks from email campaigns to social media. The company made its name by landing American Express as a $1-million-a-year customer.

Qualys (QLYS): Finding security flaws before the bad guys

Date of IPO: Sept. 28
IPO price: $12.00
Shares offered: 7.6 million

Qualys is a cloud service that makes sure enterprise IT systems are secure. Its CEO, Philippe Courtot, is well-known for a bunch of successful startups, including an early email company, cc:Mail.

Workday (WDAY): Getting even by bringing human-resources apps to the cloud

Date of IPO: 10/12
IPO price: $28.00
Shares offered: 22.8 million

Workday was the most anticipated enterprise IPO of 2012--the Facebook of the enterprise, so to speak. It popped big on its opening day and has continued to do well. Workday is a cloud-based human resources app built by PeopleSoft founder David Duffield and executive Aneel Bhusri, who lost a bruising takeover battle with Oracle. Now they're gunning for Oracle in cloud software.

Enterprise companies make great employers, too ...

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