Do You Have These IPO Stocks On Your Watchlist Now?
As the stock market has boomed over the past year, so have initial public offerings (IPOs). 2020 was a record year with 480 companies going public on U.S. stock exchanges. That’s more than in any year in the previous two decades. With more stocks doubling in their first day of trading than ever before, it’s no secret that investors are buzzing about the latest IPO stocks in the stock market today. With all the attention that IPO stocks are getting, it’s no wonder investors are looking for the next top IPO stocks to buy that could deliver tremendous returns.
If you’re a retail investor in Robinhood, there’s good news for you. Apart from zero commission trades and an easy-to-use platform, Robinhood is allowing its investors to participate in IPO stocks in its latest move to democratize retail investing. The company is rolling out IPO Access, a new product that will allow investors to buy shares of companies at their IPO price before hitting the public market.
Certainly, the IPO market has been red-hot. The recent IPO from Roblox (NYSE: RBLX) and Coinbase (NASDAQ: COIN) saw investors bidding more than 50% of their opening prices. With so many companies going public, it’s impossible to keep track of them all. But here are a few companies that went public this week. Notably, these companies didn’t come public in a bull market, which could make them better value stocks to consider.
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Top IPO Stocks To Watch Right Now
- Oatly Group (NASDAQ: OTLY)
- Procore Technologies (NYSE: PCOR)
- Squarespace (NYSE: SQSP)
Swedish plant-based milk substitute Oatly finally hit the public market Thursday. Oatly stock ended the day up more than 18% after the company’s public debut. For the uninitiated, the company is a pioneer in the field and the largest seller of oat-based milk in the world. The company was already a big hit in Sweden before gaining popularity in the U.S. market. By joining forces with Starbucks (NASDAQ: SBUX) to provide its plant-based milk substitute, the company has quickly gained significant attention.
From its financial year ended December 31, 2020, the company’s revenue came in 106% higher to $421.4 million. Being an early-stage company, it’s not surprising that the company has yet to achieve profitability. That’s usually because it’s investing heavily into itself. But once the overall business picks up pace, the growth in its top line could justify its reinvestment. As long as there’s huge demand from customers, the lack of profitability now is not a cause for concern.
It’s also worth pointing out that a number of notable investors have invested in Oatly. They include former Starbucks CEO Howard Schultz, state-backed China Resources, and Blackstone. With Oatly’s large and growing customer base and having its products at major retailers like Walmart (NYSE: WMT) and Target (NYSE: TGT), the outlook for this consumer company remains bright. The company is also not resting on its laurels and has been expanding its portfolio to offer other new products. That is not to mention that consumer interest in plant-based food and beverages continues to be strong. Considering the ambitious plan of the company’s leadership, would you also be keen on buying OTLY stock?
Like Oatly, Procore Technologies also made its debut as a public company on Thursday. For starters, Procore Technologies is a cloud-based construction software company based in Carpinteria, California. Accordingly, investors are betting on Procore’s ability to innovate in one of the “oldest, largest, and least-digitized industries in the world.” The ease of collaboration and efficiency contractors gain from the company’s technology is one key reason why investors are bidding on PCOR stock on Thursday. On its first day of public trading, PCOR stock closed more than 30% higher.
“We saw the progress in our industry’s recovery quarter after quarter, and figured this was the right time to go ahead with our debut despite day-to-day fluctuations in the market,” Craig Courtemanche, Founder and Chief Executive Officer of Procore Technologies
Perhaps the most exciting part of Procore’s business is the market opportunity. According to the company, the construction industry is responsible for about 13% of global economic output. But Procore is not alone in this niche sector, Oracle and Autodesk (NASDAQ: ADSK) are formidable competitors in this space. The good thing about Procore’s platform is that users can still easily share files and collaborate efficiently even though the other parties are using Autodesk’s software. This is why Procore has continued to see steady growth despite the rise in competition. Having said all that, it’s safe to say that Procore is sticky. Besides, the company’s business should benefit from industry tailwinds in the coming decade. Although the company has skyrocketed on its first day of trading, PCOR stock is still worth adding to your watchlist.
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Squarespace, which sells tools for easy website creation and publishing, went public one day earlier than Oatly and Procore Technologies. The company also went public through a direct listing rather than raising capital in an IPO. Essentially, insiders can start selling right out of the gate and don’t have to wait for a lock-up expiration. This could help explain why the company’s stock price fell on its first day of trading. Despite its first day decline, SQSP stock staged a rebound on Thursday. And that reversed the losses during its first day of public debut.
For the unfamiliar, the all-in-one website building and e-commerce platform started back in 2003. It now has more than 1,200 employees and multiple offices in major cities. In addition to website creation tools, the company also offers search engine optimization tools and services for building an e-commerce channel for companies.
The company’s founder Anthony Casalena reportedly told CNBC’s “Squawk Box” on Wednesday, “A direct listing fit for us because Squarespace has been a profitable company for a number of years and we don’t need to raise money in this event…Our thinking was to pursue the direct listing, give people the option to buy if they want to buy, sell if they want to sell. What’s great about the direct listing is no one’s suffering unnecessary dilution today.” If you are interested in investing in a new IPO stock that’s profitable right now, would SQSP stock be a good fit in your portfolio?