Stock Watch: Drugstore.com Soars On IPO Day

As expected, drugstore.com (Nasdaq: DSCM) became the latest billion-dollar company when it went public on Wednesday. Shares of the initial public offering, which priced at $18 after an original range of $9 to $11, closed up 32-1/4 to 50-1/4, a gain of 179 percent. Shares traded as high as 69.

At 50-1/4 a share, drugstore.com, which just launched in March and has recorded $4.2 million in sales through June, is worth more than $2.1 billion. Like Amazon.com, which has a 26.8 percent stake of the online drugstore, drugstore.com expects to lose money for the foreseeable future as it builds its brand and customer base.

The biggest winners on Wednesday may have been two brick-and-mortar retailers. Last month, Rite Aid acquired 25 percent of drugstore.com for $7.6 million, while General Nutrition Centers purchased 8 percent for $2.4 million. Rite Aid’s stake is now worth about $532 million, while GNC’s stake is worth about $170 million.

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