Pandora Media Inc opened 25 percent above its $16 IPO price per share in its stock market debut on Wednesday as investors flocked to get a piece of the latest Internet start up, even though it has yet to turn a profit.

At $20 a share, the online radio company would have a market value of about $3.2 billion. That price would value the company at 23 times its 2010 sales, far above the value placed on Google, Amazon, and Sirius XM.

Shares later touched a high of $23.75.

Internet companies such as Pandora, professional networking company LinkedIn and online daily deal site Groupon, which filed to go public earlier this month, remain a healthy part of the U.S. new issue market, despite a broader downturn and postponements of other large IPOs like Ally Financial.

LinkedIn and other Internet companies such as China's Renren and Russia's Yandex have had strong IPOs building on anticipation for potential offerings by Facebook and Twitter.

Pandora, which has been around for a decade, runs a service that recommends songs to listeners based on member feedback, allowing them to create playlists based on a song, artist or genre.

Users can listen to the service through computers, smartphones and devices that hook into home entertainment centers such as the Roku box. Pandora has also struck up partnerships with auto manufactures including Ford General Motors and Mercedes-Benz.

With 90 million registered users in the United States, Pandora makes money mainly from advertising and it has to pay significant royalties for music.

(Reporting by Jennifer Saba; editing by John Wallace and Chelsea Emery)