TrueCar shares up 16% after lowball IPO price

Feeling a bit like the car dealers in its car-selling network, auto research and sales outfit TrueCar got horse-traded down to only $9 a share in its IPO, from the $12 to $14 range the company had forecast.

Bloomberg calculates that the initial public offering was 7.78 million shares, raising $70 million for the company to use marketing new products.

Investors decided the stock is more valuable than that, though, and the newly public company's first day of NASDAQ trading opened at $9.75. Mid-day trading had pushed it to $10.44.

TrueCar operates TrueCar.com, an online car-shopping and research site. The site shows a range of good, bad and average prices that others are paying for the car you want in your area. It claims to account for 3.2% of new-car sales in the U.S.

Initially the site was able to give shoppers guaranteed prices from its affiliated dealers. But Honda told dealers in 2012 they couldn't do that if resulted in advertising cars for less than the invoice price, and some states called the arrangement illegal under their dealer-franchise laws. So TrueCar overhauled its approach to focus on what others are paying instead of getting a price gurantee.

That's made it less distinctive, because some competing car sites do the same.

Main rivals include Edmunds.com, Kelley Blue Book's kbb.com and Cars.com, which are not public.

TrueCar founder Scott Painter has been involved with a number of other car-shopping and -buying companies, such as CarsDirect and Auto-By-Tel.

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TrueCar President John Krafcik, late the CEO of Hyundai Motor America, and industry veteran Larry Dominique, head of TrueCar's ALG unit, are well-regarded, seasoned players in the car business.