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Looks like the initial public offering of online mortgage provider E-Loan (Nasdaq: EELN) is a solid one, after all. E-Loan went public on Tuesday after pricing its IPO at $14. The stock closed its first day of trading at 37, a gain of 164 percent.
This gain is actually more remarkable than it appears. E-Loan went public just one day before the Federal Reserve is expected to raise interest rates. Higher interest rates can spell tough times for mortgage companies. Also on Tuesday, statistics were released that reported U.S. home sales were down in May. This obviously is another a bad sign for companies like E-Loan.
This IPO was originally scheduled for earlier this month, but it was postponed and the price range was reduced from the original $11 to $13 range to $9 to $11. The IPO market has rebounded nicely recently, and E-Loan ended up pricing its IPO higher than its original range. It's rather amazing how the interest -- no pun intended -- in an IPO can change in a matter of weeks.
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