The global initial public offering (IPO) market hit record heights in 2021. However, in the first quarter of this year, a volatile market spelled a slowdown in global IPO activity. The year started with the strongest opening in 21 years, measured in terms of proceeds. However, the second half of the quarter saw IPO activity plummet, representing $54.40 billion in proceeds, down 51% year-over-year.
However, Wharton management professor David Hsu believes that one high-profile IPO might boost the market. Last year, Rivian Automotive Inc. (RIVN) stood out as the star performer in the IPO market. The stock market might be poised for a ‘solid rally’ this month, according to Bank of America Corp. (BAC). This might spill over into higher returns in May and June, driving a strong second quarter.
Amid this, Wall Street analysts expect the stocks Samsara Inc. (IOT), Fluence Energy, Inc. (FLNC), Amplitude, Inc. (AMPL), and Allbirds, Inc. (BIRD) to rally by 100% -200% in price.
Samsara Inc. (IOT)
San Francisco-based IOT is a solution provider that connects physical operations data to its connected operations cloud globally. The company offers the Connected Operations Cloud, which includes a data platform that enriches data from its IoT devices. IOT went public after a traditional IPO process on Dec.15, 2021.
On April 5, IOT announced its integration with John Deere to empower agricultural operations, which marks an expansion over their JDLink Integration. The agriculture industry has seen the value of technology innovation for several years. “With this integration, we’re able to take another step forward in bringing these physical operations to the cloud,” said Chris Mozzocchi, Senior Director of Product Management, Product and Ecosystem Integrations at IOT.
On March 2, IOT declared the establishment of two additional offices in Amsterdam and Mexico City. This is expected to enable the company to provide better customer service and expand its global footprint.
For its fiscal fourth quarter, ended January 29, IOT’s revenue increased 65.6% year-over-year to $125.75 million. Its gross profit rose 59.1% from the prior-year quarter to $87.05 million. The company’s cash, cash equivalent, and restricted cash balance came in at $944.31 million, up 117.4% from the same period the prior year.
The consensus EPS estimate for its fiscal year 2023 indicates a 31% year-over-year increase. And the $572.45 million consensus revenue estimate for the same year reflects a 33.6%improvement from the prior year.
The stock has gained 1.4% in price intraday to close yesterday’s trading session at $13.53.
Seven Wall Street analysts rating IOT have rated it Buy. The 12-month median price target of $27.33 indicates a 102% potential upside. The price targets range from a low of $25.00 to a high of $30.00.
Fluence Energy, Inc. (FLNC)
FLNC in Arlington, Va., operates as an energy storage products and services provider. The company also provides AI-enabled digital applications for renewables and storage applications worldwide. FLNC’s shares of Class A common stock began trading on the Nasdaq Global Select Market on Oct. 28, 2021.
On April 11, FLNC announced that it had agreed to acquire Nispera AG, a Zurich-based provider of AI and ML-enabled software-as-a-service (SaaS) targeting the renewable energy sector. The company expects this acquisition to enhance its recurring revenue and add visibility to its future cash flow.
On February 9, FLNC announced an agreement with the AES Corporation (AES) for employing the AI-powered Fluence IQ Bidding Application to maximize the value of a 1.1 GW portfolio of solar and energy storage projects in the Western United States. This might prove to be beneficial for the company.
FLNC’s total revenue increased 50.5% year-over-year to $174.89 million in its fiscal first quarter, ended December 31. Its net cash provided by financing activities rose 3,688.6% from the same period the prior year to $833.49 million. The company’s cash, cash equivalent, and restricted cash balance stood at $679.42 million, registering a 1,650.2% improvement from the prior-year period.
The Street’s EPS estimate for its fiscal year 2023 indicates a 74.5% year-over-year rise. And the Street’s $1.65 billion revenue estimate for the same year reflects a 46.4% increase from the prior year.
FLNC’s shares have declined 3.3% in price intraday to close yesterday’s trading session at $10.24.
Among the 10 Wall Street analysts rating FLNC, seven have rated it Buy, two have rated it Hold, and one has rated it Sell. The 12-month median price target of $27.11 indicates a 164.8% potential upside. The price targets range from a low of $13.00 to a high of $39.00.
Amplitude, Inc. (AMPL)
AMPL operates as a digital optimization system provider to analyze customer behavior with digital products. The San Francisco company’s offerings include Amplitude Analytics, Amplitude Recommend, Amplitude Experiment, and Amplitude Behavioral Graph. The company went public in a direct listing of its Class A common stock on Sept. 28, 2021.
On March 7, AMPL announced the availability of its Amplitude digital offering on Amazon Web Services. This might help AMPL reach a greater number of customers because AWS customers around the globe could access the Amplitude digital catalog through their AWS Marketplace accounts.
On February 16, AMPL announced integrations with Adobe Launch, AWS Redshift, Google BigQuery, Google Tag Manager, and MailChimp, and enhanced integration with HubSpot. Justin Bauer, senior vice president of product at AMPL, said, “We’re becoming the go-to hub for customer data, making it easier than ever for companies to understand their customers, create better product experiences, and ultimately grow their business.”
For its fiscal fourth quarter, ended Dec. 31, AMPL’s revenue increased 64.3% year-over-year to $49.42 million. Its non-GAAP gross profit improved 67.2% from the prior-year quarter to $35.58 million. And the company’s cash, cash equivalent, and restricted cash balance rose 159.4% from the same period the prior year to $308.30 million.
The $231.73 million consensus revenue estimate for its fiscal year 2022 reflects a 38.5% year-over-year improvement.
The stock has gained 13% in price over the past month and 4.1% intraday to close yesterday’s trading session at $18.90.
Among the five analysts rating AMPL, three have rated it Buy, and two rated it Hold. The 12-month median price target of $44.00 indicates a 132.8% potential upside. The price targets range from a low of $38.00 to a high of $60.00.
Allbirds, Inc. (BIRD)
San Francisco-based BIRD is a manufacturer and seller of footwear and apparel products for men and women. The company offers shoes, including running shoes and sneakers, and apparel, including activewear, tops, and bottoms. After an IPO, BIRD began trading on the Nasdaq Global Select Market on Nov. 3, 2021.
On February 17, BIRD announced the launch of Allbirds ReRun, a resale platform in a partnership with branded re-commerce company Trove. The company will sell gently used shoes at reduced prices through the new platform. This might add to the company’s revenue stream.
BIRD’s net revenue increased 22.6% year-over-year to $97.22 million in its fiscal fourth quarter, ended December 31. Its gross profit rose 23.7% from the same period in the prior year to $48.78 million. Its adjusted EBITDA came in at $427,000, up substantially from its negative year-ago value.
The consensus EPS estimate for its fiscal year 2022 indicates a 58.5% year-over-year increase. And the $362.30 million consensus revenue estimate for the same year reflects an improvement of 30.6% from the prior year.
The stock has gained 1.5% in price over the past month to close yesterday’s trading session at $5.45.
Among the 10 analysts who have rated BIRD, seven rated the stock Buy and three rated it Hold. The 12-month median price target of $16.40 indicates a 200.9% potential upside. The price targets range from a low of $6.00 to a high of $25.00.
IOT shares were trading at $13.87 per share on Wednesday morning, up $0.34 (+2.51%). Year-to-date, IOT has declined -50.66%, versus a -7.28% rise in the benchmark S&P 500 index during the same period.
About the Author: Anushka Dutta
Anushka is an analyst whose interest in understanding the impact of broader economic changes on financial markets motivated her to pursue a career in investment research.
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