Tableau Shares Jump More Than 50% in IPO

No question, traders in the stock market knew there was going to be an appetite for shares of data visualization provider Tableau Software. But that hunger for business-tech IPO stocks is even deeper than Tableau guessed.

Shares of the Seattle-based company (NYSE: DATA) were up more than 50 percent in midday trading after its initial public offering, which priced Thursday night at $31 per share. The people who got shares at that price are big investment clients corralled by underwriters Goldman Sachs, Morgan Stanley, Credit Suisse, JP Morgan and others. Once the stock hit the open market Friday morning, demand was immediately red-hot. Tableau stock opened trading at $47, and eclipsed $50 a share at one point during the first few hours of trading.

While the folks who got shares at $31 last night are sitting on instant riches, Tableau is clearly getting a lot less money to pour into its bank account than it could have. Tableau sold 5 million shares at $31 apiece, collecting about $155 million for itself before expenses. The company could reap even more cash from the stock sale in the coming days, as the investment banks underwriting the deal have an option to buy another 1.2 million shares.

In addition, private shareholders in the company sold 3.2 million shares of Tableau stock at the opening IPO price. That money will go to the private investors in Tableau, so it won’t flow into the company’s bank account.

There was clear demand for Tableau stock as bankers shopped the company to their investment clients during the “road show” period leading up to the IPO—Tableau raised its projected price twice before the stock sale, and the $31 per share it finally sold for was above even those enlarged estimates.

But the company may be kicking itself a little bit for not upping the price tag even further. If Tableau had been able to fetch the full $47 per share value last night, and still been able to sell 5 million shares, then it could have brought in another $80 million for the company coffers. It’s hard to say exactly what price Tableau could have gotten from investment banking clients last night, but the stock reaction today suggests that it left significant money on the table, while the clients of its underwriters won big.

The company’s principals may not exactly be crying themselves to sleep, though. The co-founders each have multimillion-dollar stakes in Tableau. And perhaps more importantly, they have delivered on their long-stated vision of building a strong, independent, public tech company based in Seattle.

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