The underwriters of an initial public offering are notorious for giving the companies they take public positive coverage after the quiet period ends. Oftentimes, investors are left unsure about how bullish the underwriters really are. It often takes a strong buy rating to get investor’s attention.
On Monday, Art Technology (Nasdaq: ARTG) got that and a whole lot more. Shares of Art Technology, which builds Web sites for e-commerce businesses and online content companies, rocketed nearly 28 percent on Monday, climbing 4-1/16 to 18-3/16. The gain came after lead underwriter Hambrecht & Quist gave Art Technology — whose customers include everybody from 3M and Sun Microsystems to SonicNet and TheStreet.com — a buy rating, while co-managers U.S. Bancorp Piper Jaffray and Thomas Weisel Partners both initiated coverage with a strong buy rating.
U.S. Bancorp Piper Jaffray was the most bullish, giving Art Technology a price target of $50, which is more than three times what the stock closed at Friday. That’s what you call great expectations.