Brazil-based payment services company PagSeguro Digital ( PAGS ) turned in a hot initial public offering Wednesday, with the stock up 33% on its first day of trading.
PagSeguro Digital raised $2.3 billion, offering 105.4 million shares at 21.50 each and above the estimated range of 17.50 to 20.50. Shares ended the regular session up 35.8% to 29.20 on the stock market today .
The company provides online and in-store payment services, including mobile services, for small businesses in Brazil. The company launched in 2006 as an online payment platform to provide the digital payment infrastructure necessary for e-commerce to grow in Brazil.
During its fiscal third quarter, PagSeguro reported revenue of $217 million, an increase of 139% from the year-ago period, with adjusted earnings of 14 cents a share, up 250%.
PagSeguro is owned by Brazil-based UOL, which controls 95.8% of voting shares and says it will control "all matters requiring shareholder approval." Founded in 1996, UOL says it's Brazil's largest internet content, digital products and services company.
IBD'S TAKE:The biggest stock market winners typically make their major price moves within a few months or years of their initial public offering. So it pays to identify and track companies that are getting ready to go or have recently gone public. Learn more atIBD's IPO page. IBD also focuses on the best-performing IPOs of the past three years in itsIPO Leaders column.
Competitors to PagSeguro include PayPal ( PYPL ) as well as MercadoLibre ( MELI ) subsidiary Mercado Pago and Wirecard.
Although Brazil is the largest economy in Latin America as measured by gross domestic product, digital payment penetration in the country remains low compared to more developed economies, PagSeguro says.
The lead underwriters for the IPO were Goldman Sachs and Morgan Stanley.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
