Castlight Health Soars in Debut; Shares More Than Double
San Francisco-based Castlight Health Inc. (NYSE:CSLT), a young company that makes software that tracks healthcare costs, skyrocketed on the New York Stock Exchange this morning. The shares more than doubled in their first day of trading, giving Castlight Health one of the best first-day initial public offering performances of 2014 thus far, according to the New York Times. It’s worth noting that well over half of the biggest IPO debuts of 2014 have been biotech firms.
Shares of Castlight opened at $37.50 on Friday; the shares were priced at $16 on Thursday evening. The company raised more than $178 million after pricing its IPO of 11.1 million shares, according to a Reuters report.
Castlight makes software that helps companies both track and analyze the cost of providing its employees with health insurance, making most of its money through sales of its software suite. Among its customers are companies such as CVS Caremark, T. Rowe Price, and Tesla, according to a New York Times report. The company has signed more than ninety-five customers in the last two years.
The company is betting that soaring healthcare costs and norms for greater transparency will help create a rising demand from companies for data aggregation and analytics, Reuters reports. The company estimates that the potential market for its services is about $5 billion.