Wall Street is salivating this morning over Potbelly, a burgeoning chain of sandwich shops that just served up a hot initial public offering. The company sold 7.3 million shares at $14 apiece, above their expected range of $12 to $13, and in the first few hours of trading Friday the price promptly doubled and showed little sign of slowing.
This is not a company with a treasure trove of patents, some magical brew of tech alchemy, or legions of workers selling smart services. It’s a simple restaurant chain with slim profit margins to match, perennially less than 4 percent, according to its seminal SEC filing. To make good, then, the Chicago-based company needs to grow. The hope of Potbelly, its bankers and investors, and any entrepreneur whipping up quick fare is to become the next Chipotle, the burrito chain whose shares have rocketed from $22 to $427 since going public in 2006.