Sandwich Maker Potbelly's Shares Soar 120% On Debut Day

(RTTNews) - Shares of Potbelly Corp. (PBPB) more than doubled on the first day of debut as the sandwich maker's shares were gobbled up by investors to show their never ending appetite for initial public offerings. Chicago, Illinois-based Potbelly's shares soared on market debut after it began trading on the NASDAQ Global Select Market under the ticker symbol "PBPB" on Friday and ended the day nearly 120 percent above its IPO pricing.

PBPB closed Friday's trading session at $30.77, up $16.77 or 119.79 percent on a volume of 17.0 million shares after hitting a high of 33.78 within the first two hours of trading. It opened trading at $28.79.

The company had priced the IPO at $14.00 per share, above the expected pricing range between $12.00 and $13.00 per share for 7.5 million common shares, and will raise $105 million. The company had initially set the IPO at between $9.00 and $11.00 per share.

The company filed the initial registration statement on form S-1 with the U.S. Securities and Commission Exchange for an IPO to raise up to $75 million on August 29. The company sold 7.35 million shares of common stock and certain stockholders sold 150 thousand shares of common stock.

The company said in its preliminary prospectus that it plans to use the net proceeds from the offering to pay a previously declared cash dividend as well as for working capital and general corporate purposes.

BofA Merrill Lynch and Goldman, Sachs & Co. are acting as joint book-running managers for the offering, and Robert W. Baird, William Blair, and Piper Jaffray are acting as co-managers.

Potbelly started in 1977 as a small antique store on Lincoln Avenue in Chicago. To boost sales, the original owner began offering toasty warm sandwiches to customers. The original owner sold the Lincoln Avenue store to Bryant Keil in 1996.

Potbelly is a fast-growing neighborhood sandwich concept offering toasty warm sandwiches, signature salads and other fresh menu items like milkshakes and baked cookies, priced between $6 and $8.

The company reported net profit attributable to Potbelly of $24.05 million, an increase from $7.17 last year, while revenue grew 15.5% to $274.9 million for 2012, according to the IPO filing.