Some analysis from my site of new and innovative companies, which received massive media attention and hype in the last years. But after hype is gone, many of these stocks has significantly fallen in their prices, especially those that went public in the last two to three years. Nevertheless, in my opinios we have some hidden gems here, which may be worth a look at right now:
Bumble: A Bumpy Ride for the Dating App Giant
Bumble, a well-known dating app with additional features, has experienced a significant 77% decline in its stock since its IPO. While its revenue growth has been solid but not outstanding, with a 16% increase in the last quarter, the company's profitability has seen a slight decline but has shown signs of improvement. With a market capitalization of $2.3 billion and a price-to-sales ratio of around 2.5, the current valuation appears attractive, presenting a potential buying opportunity after the initial hype during the IPO was considered unjustified. Investors may find Bumble worth a second look given the current lack of interest in the stock.
Rivien: The “Tesla Killer” Faces Tough Competition
Rivien, known as the “Tesla Killer,” has gathered significant media attention for its electric vehicles, especially pickup trucks and SUVs with unique headlights. Despite the initial hype, the stock has plummeted by 88% since its IPO. Ford and Amazon were major investors, but the relationship with Amazon soured, leading Rivien to terminate its exclusive supply contract.
As a young company, Rivien's latest quarterly numbers show impressive revenue growth of 600%, primarily due to minimal revenue in the previous year. The company is now delivering significant quantities of cars, totaling 8,000 in the current quarter, and aims to achieve a gross profit in 2024 while targeting over 50,000 vehicle deliveries in 2023. With a cash cushion of nearly $12 billion, Rivien's market capitalization stands at $14.2 billion.
Considering the current revenue growth, Rivien's value seems attractive, but it's crucial to acknowledge the uncertainty surrounding its future. The revenue-to-sales ratio is not representative at this stage. Investors who believe in Rivien as a serious automaker may find the company's valuation worthy of respect. However, the stock remains speculative due to ongoing uncertainties and market speculation.
Didi: The Struggles of a Ride-Hailing Giant in China
Didi, a ride-hailing company with food delivery services, has experienced an 80% decline in stock value since its IPO. Revenue growth has been inconsistent due to COVID-19 impact and regulatory challenges in China. Despite a recent data scandal and a $1.2 billion fine, Didi's market capitalization is $14.5 billion, less than one times its revenue of $19 billion. A potential China comeback may make the stock appealing, but it carries increased risk.
Marqeta: A Hidden Gem in the Fintech Industry
Marqeta, a fintech company serving the B2B sector with payment and card solutions, has seen an 84% decline in stock value since its IPO. Revenue growth has been impressive, with a 31% increase in the last quarter, leading to improved profitability. Currently, Marqeta's market capitalization stands at $2.6 billion, with revenue reaching $800 million, resulting in a price-to-sales ratio of approximately 3.3. Considering the strong 30% growth, the current valuation appears exciting and remarkably inexpensive. However, the stock was evidently overvalued at its IPO, given its current financial performance.
Palantir: The Profitability Puzzle
Palantir, a well-known data analysis software firm, has seen a 66% increase in its stock since IPO, achieving near profitability in the last two quarters. While revenue growth was solid at 18%, the market capitalization stands at $33 billion, 17 times its revenue of $2 billion. This valuation is deemed very high, considering moderate profitability and an 18% growth rate.
Coupang: The South Korean Amazon
Coupang, a dominant player in South Korea's 24-hour delivery and e-commerce market, has seen a 60% decline in stock value since IPO. Despite stable growth and a 20% currency-adjusted growth rate in the latest quarter, profitability has surged by 36%, with a positive EBITDA of $241 million. With a market capitalization of $31 billion and revenue of $21 billion, the stock's current valuation is just 1.5 times its revenue, making it an attractive deal. Considering a potential strong comeback in South Korea, the stock deserves a second look.
Snowflake: A Hyped Cloud-Based Software Service
Snowflake, a cloud-based software service company, is shaping the market and expects exponential growth. Despite a 25% decline since IPO, its latest quarterly numbers were strong, with a 47% revenue increase and positive earnings per share. The net revenue retention remains high at 151%, but a downward trend is evident. With a market capitalization of $55 billion and revenue of $2.2 billion, the stock's current valuation is 25 times its revenue, considered astronomically high. The hype surrounding Snowflake's partnerships with Microsoft and Nvidia attracts investors, but caution is advised as market interest may eventually calm down.
Coinbase: Riding the Cr*ptocurrency Rollercoaster
Coinbase, a cryptocurrency platform, experienced a significant decline since its IPO, currently standing at -76% from the offering price. The decreasing interest in cryptocurrencies, particularly Bitcoin, has impacted Coinbase's trading volume and revenue, which almost halved since the beginning of 2022. Despite managing to improve profitability, Coinbase still operates at a negative margin. The current market capitalization is $17 billion with revenue of $2.8 billion, resulting in a price-to-sales ratio of over 6, which isn't considered cheap. As the market largely depends on the price of B*tcoin and cr*pto trading volume, Coinbase is viewed as a speculative investment, and direct investment in Bitcoin might yield better results, especially during downward phases.
GitLab: A Promising Business Model
GitLab, a DevOps platform solution, has experienced a decline of 56% since its IPO. Despite this, the company's business development has been promising, with pleasing revenue and profitability trends. GitLab follows a software-as-a-service subscription model, charging per user per month. The current market capitalization is $7 billion with revenue of $460 million, resulting in a price-to-sales ratio of approximately 15. While the numbers are good, the high valuation may not be fully justified yet. However, the positive business trajectory indicates potential for further stock growth.
DoorDash: Strong Growth with Uncertain Profitability
DoorDash, a food delivery service, has experienced a decline of 56% since its IPO. Despite this, the company has shown strong revenue growth, averaging around 40% in recent quarters, and provided a slight surprise in earnings per share. The current market capitalization is $29 billion with revenue of $7.1 billion, resulting in a price-to-sales ratio of 4. However, DoorDash is yet to achieve profitability, and the path to break-even remains unclear. Although restaurant food prices have increased by around 25%, DoorDash still faces challenges in reaching profitability. As such, investors may be cautious until a clear path to profitability emerges.
Roblox: Targeting a Young Audience
Roblox, an online game platform targeting a young audience, has seen a 42% decline in its stock since its IPO. Revenue growth has been stagnant, influenced by pandemic effects, and losses have significantly widened, reaching approximately $270 million per quarter. Despite this, Roblox has a high market valuation of $23 billion with revenue of $2.3 billion, resulting in a stock price ten times higher than its revenue. This valuation is considered expensive, especially considering the increased losses and minimal growth, as the company relies on the purchasing power of parents of its young target audience. As a result, investors may view Roblox as a risky investment at its current valuation.
UiPath: Robotics in Process Automation
UiPath, a company specializing in robotic process automation (RPA), has seen a significant decline of nearly 74% in its stock since its IPO. However, its revenue has almost doubled since going public, and the retention rate remains high at 22%. The latest quarterly numbers were positive, with growth and earnings per share surpassing expectations. Currently, UiPath's market capitalization is just under $10 billion with revenue of $1.1 billion, resulting in a price-to-sales ratio of 8.6, which is not considered cheap. UiPath faces competition from other players like Microsoft in the RPA and process automation space, which adds to the competitive landscape. While the company's financial performance shows promise, investors may be cautious about its valuation and the competitive challenges it faces.
Toast: A Savory Deal for Restaurant Operators
Toast, a specialized software solution for the restaurant sector, has experienced a decline of -60% in its stock value since its IPO. However, the company's financials show positive signs. It has achieved steady growth with a robust 53% revenue increase in the first quarter of 2023. The revenue sources include hardware sales, subscription model fees, and other channels for restaurant operators. Toast's profitability has also improved significantly, with the negative adjusted EBITDA nearly halving in recent quarters. Currently, the stock has a market capitalization of $11 billion with revenue of $3 billion, resulting in a price-to-sales ratio of 4, which is considered an attractive valuation given the current growth rate. The company's ingenious business model that covers various aspects of the restaurant business makes it promising for potential investors despite its recent stock decline.
Affirm: Stagnation in the “Buy Now, Pay Later” Space
Affirm, a fintech company providing “buy now, pay later” solutions to online retailers, has experienced a 57% decline in its stock value since its mid-2021 IPO. The company's revenue has remained relatively stagnant in recent quarters, with no significant growth. Similar trends are observed with competitors like Mollie, Afterpay, and Zip, indicating a stagnant market. Due to the lack of growth and increasing profits, the current valuation is deemed too expensive, and the stock does not present many investment opportunities.
Summary
In conclusion, this analysis highlights the rollercoaster ride of IPO hype, with some stocks failing to fullfill the expectations, while others offer hidden gems potential. For me personaly: Toast and Coupang stand out as promising stocks with strong financials. Let me know your thoughts on this summary and your personal “hidden gems”.
And of course as always: This is not a financial advice and im not a financial advisor. All investements carry some form of a risk. Nothing is guaranteed.
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