NEW YORK (CNNMoney) -- Zipcar shares soared in their market debut Thursday, after the car sharing company's initial public offering raised more money than it had expected.
Shares of the decade-old Cambridge, Mass.-based company opened at $30 per share on Nasdaq, a 67% increase from its offering price of $18. The stock later pulled back to about $28.
Zipcar (ZIP) raised $174.3 million, 31% more than it had originally planned, after increasing the number of shares and pricing them above the proposed range of $14 to $16.
Zipcar said it plans to use the proceeds to pay down debt and expand its network, which already boasts 560,000 members and over 8,000 cars in urban areas and college campuses in the United States, Canada and the United Kingdom.
Investor demand for Zipcar, which allows members to rent cars by the hour or day, was strong despite the company's lack of profitability. In 2010, Zipcar posted a $14.1 million net loss, though sales climbed 42% year-over-year to $186.1 million.
"Zipcar is still in a growth phase, and investors see a lot of potential in it," said Matt Therian, research analyst at Renaissance Capital. "The company has shown rapid revenue growth and positive cash flows, and investors are counting the company to deliver on that track record."
Therian added that Zipcar is saddled with a number of up front costs as it enters into new markets, as it has to buy vehicles and parking spaces in the new cities.
But as business grows, as it has in the company's more mature markets including New York and Boston, revenue from membership fees offers a strong return on those initial investments.
Meanwhile, shares of McDonald's largest franchisee, Buenos Aires-based Arcos Dorados Holdings Inc. (ARCO), also soared in their public debut.
The stock jumped almost 30% to $21.44 per share, after raising $1.25 billion in its initial public offering by selling 73.5 million shares for $17 each.
Investors weren't as enthusiastic for the market debut of Greek shipping company Box Ships Inc (TEU). Shares of the Athens-based firm fell 5%. The company's offering price was $12 per share, below the expected range of $15 to $17 per share.
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