Pinterest shares close 28% up on NYSE trade debut

(c) Sky News 2019: <a href="">Pinterest shares close 28% up on NYSE trade debut</a>

Social media website Pinterest ended its first day of trading on the New York Stock Exchange with shares up by almost a third , as it returned some much-needed faith in technology initial public offerings (IPOs) to Wall Street.

The company had set the price for its 75 million shares at $19 (£14.56) on Wednesday evening, above its $15 to $17 target range.

The opening trade at $23.75 took the scrapbooking website's market valuation to $15.8bn.

By close of market, shares had shot up by nearly $6 to $24.59.

The successful debut bodes well for the US IPO market as it prepares for the greatly-hyped listing of ride-hailing giant Uber Technologies.

In particular, Pinterest's performance will be considered a test for tech listings, following last month's disappointing debut from ride-hailing firm and Uber rival Lyft, which was unable to hold onto the gains it made at flotation.

Lyft had an impressive build-up - raising more than expected when it went public - but shares have since dropped by about 30%.

"All of the gyrations that you read about in the press and the drama that you read about in other cases, we can certainly fall victim to a lot of those things if we are distracted by the news cycle or things that are short-term by nature," Pinterest chief financial officer Todd Morgenfeld said in an interview on Thursday.

"But we're focused on building the best version of Pinterest we can over the next several years."

The IPO was underwritten by a 12-member team comprising of bankers from Goldman Sachs and JP Morgan.

Pinterest says it has 250 million users and reported a net loss of $63m (£48.5) on revenue of $756m (£579m) last year.

Its primary source of income is from advertisements that are placed among the "pins" or posts on the social media website.

Pinterest is the biggest listing of a US social media company since Snapchat's parent company made its debut in 2017. Snap's stock price has also fallen since its IPO.

Thursday also saw a successful debut by US video conferencing firm Zoom Video Communications, which soared 80% above its IPO price of $36, before closing slightly lower - up 75% on its launch price.

"It is a very favourable market at the moment," said Zoom chief financial officer Kelly Steckelberg in an interview.

"Investors really see the opportunity for software as a service companies."