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'Pizza' IPO attracts dough
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August 2, 2000: 4:09 p.m. ET
California Pizza Kitchen shares rise 35 percent on first day of trading
By Staff Writer Kim Khan
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NEW YORK (CNNfn) - Investors added some extra dough to shares of California Pizza Kitchen Wednesday after the company dished up its stock to hungry Wall Street traders for the first time.
California Pizza Kitchen, which grew from a Los Angeles specialty pizza shop into a popular nationwide chain, saw its shares jump 5-1/4, or 35 percent, to 20-1/4 on its first day of trading, shrugging off earlier predictions that the company would find few customers on Wall Street.
"CPK did well in the aftermarket just because of its brand name," said Cory Ostman, co-chief executive of Alert-IPO.com. "It's just like Krispy Kreme in that respect."
In April, Krispy Kreme Doughnuts Inc. (KREM: Research, Estimates) stock jumped 75 percent on its first day of trading, bucking what has typically been a bland reception for restaurant chain IPOs.
 The Los Angeles-based premium pizza parlor chain raised $79.5 million Tuesday night by pricing 5.3 million shares at $15, the top of its expected range.
The company's CEO, Frederick R. Hipp, told CNNfn his company's toppings distinguish it from other parlors and the restaurant is often compared with more upscale eateries. (266K WAV or 266K AIFF)
California Pizza Kitchen was founded by former federal prosecutors Larry Flax and Rick Rosenfield and has enjoyed success with its specialty pizzas, which feature such uncommon toppings as its barbeque chicken and Peking duck.
"[California Pizza Kitchen] realized pizza places are all over and you need to find your special niche," said Don Vlcek, former vice president at Domino's Pizza. "They made a breakthrough and created new types of pizza people would look on as refreshing."
Vlcek is also impressed by the company's focus on quality and the treatment of its workers.
Hipp said the company will stick to its plan and won't branch out from its core pizza business.
"We're going to stay focused -- that's what we do best. We're not going to stray and you'll see a lot more innovation along those lines, but that's what we're going to stick to," he said.
The first major restaurant offering in more than a year, California Pizza Kitchen (CPKI: Research, Estimates) earned nearly $5.4 million in 1999 on revenue of more than $179 million. The company has more than 100 restaurants and take-away shops in 21 states.
California Pizza Kitchen also has a deal in place with Kraft Foods Inc. to distribute frozen pizza.
The lead underwriters of the deal are by Bank of America Securities LLC and Deutsche Banc Alex. Brown.
And back to the tech sector ...
Shares of OPNET Technologies jumped 50 percent, rising 5-1/2 to 18-1/2.
The Washington, D.C.-based company provides software for optimizing networks and posted a $200,000 profit on revenue of more than $12 million in 1999.
"A lot of people are investing in hardware but there hasn't been much interest in the tools that enhance performance, so it's good to see an interest in software," Ostman said.
OPNET counts a number of big-name companies in its customer base, including AT&T (T: Research, Estimates), WorldCom (WCOM: Research, Estimates) and Sprint (FON: Research, Estimates).
OPNET (OPNT: Research, Estimates) priced 4 million shares at $13, the middle of its range, raising $52 million. The lead manager is Morgan Stanley Dean Witter.
Israeli wireless company Floware Wireless Systems Ltd. also had a solid debut, with shares rising 5-1/8, or 40 percent, to 18-1/8.
"Floware did very well today and it was interesting to see what an international wireless company would do," Ostman said. "There hasn't been much in the wireless sector since AT&T Wireless came out."
Floware (FLRE: Research, Estimates) lost more than $9.3 million in 1999 and had revenue of $3.3 million, but is expected to grow at a rate of 102.5 percent. Credit Suisse First Boston is the lead underwriter.
Genaissance fair
Genaissance Pharmaceuticals rose 3-1/16 to 16-1/16 on its first day. The New Haven, Conn.-based company uses population genetics testing to improve drug test efficiency.
Genaissance (GNSC: Research, Estimates) raised $78 million by pricing 6 million shares at $13. The deal was led by Deutsche Banc Alex. Brown.
Hispanic media company Entravision Communications (EVC: Research, Estimates) rose 2-1/2 to 19, after raising $759 million
The Santa Monica, Calif.-based firm owns 17 TV stations, 64 radio stations, 10,000 billboards, and two leading newspapers.
Entravision priced 46 million shares at $16-1/2, 50 cents above its range through Donaldson Lufkin & Jenrette and Credit Suisse First Boston. 
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