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ServiceNow revives tech IPOs

SAN FRANCISCO (MarketWatch) -- The initial public offering of ServiceNow Inc., the first major tech IPO since the Facebook Inc. debacle, demonstrated that there is still an appetite for tech deals, if they are priced correctly.

Analysts had predicted that ServiceNow (NOW) , a cloud-based IT automation company, would do well, in part because it is in the fast-growing cloud computing arena, and its underwriters, led by Morgan Stanley, appeared to have learned from the overwrought valuation they established in pricing Facebook (FB) . ServiceNow shares were up nearly 28% after being priced at $18 a share, which was above the initial range. Read more about ServiceNow's IPO.

Other cloud computing oriented companies have also done well earlier this year. Guidewire Software Inc. (GWRE) , which went public in January, is trading at 63% above its initial opening of $16.75, and is among the best performing IPOs this year. Read "Tech IPOs look to break Facebook curse."

ServiceNow is the fourth U.S. company to go public this week, and it had the best performance yet so far. Earlier this week, three companies EQT Midstream Partners (EQT) , TESARO Inc. (TSRO) and Exa Corp. (EXA)

Exa had a far rockier market debut in the first flurry of deals in the wake of Facebook. Read more about other IPOs this week.

Investors appear to have decided that social media companies do not deserve the valuations that bankers tried to push, and they see more potential value in companies that provide the more boring, but stable technology plumbing.

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