Storage IPO Market Stays Hot

For storage vendors, 2006 will be remembered as the year the sector returned to favor on Wall Street.

Isilon and Double-Take both successfully completed initial public offerings on Friday, bringing to four the number of storage companies that have gone public this year. Along with Riverbed and CommVault , the storage companies are the first to brave the public markets since Xyratex went public in mid-2004.

Isilon was the biggest surprise of the bunch, posting a 78 percent gain in its debut, the third strongest IPO of the year in any sector, according to MarketWatch.com.

The clustered NAS vendor raised more than $100 million in its debut, thanks to its 240 percent sales growth in the first nine months of the year, but the company lost $15 million on $41.6 million in revenues and faces tough competition from the likes of EMC and NetApp.

Double-Take raised $51 million in its debut and its stock scored a 15 percent gain in its first day of trading. The backup and recovery specialist earned $5 million in the first nine months of the year, and sales were up 44 percent to $26.2 million.

One factor behind the storage sector’s resurgence on Wall Street is its steady growth, which has hovered around double-digits even as other technology sectors have faltered (see Another Solid Quarter for Storage).

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