The busiest year for companies going public in over a decade has been a mixed one for investors. Most companies that had their initial public offering, or IPO, this year saw their shares sink, rather than rise.
However, underperformance is no indication that a newly-public company is destined for failure. A number of companies that went public this year have already been strong performers, many even making a profit as they finally went public.
Among some of the more profitable names going public this year is cryptocurrency brokerage Coinbase (COIN). Shares are still down about 25 percent from their IPO price, although they off their lows.
However, shares have seen earnings grow nearly 400 percent in the past year, and revenue is up over 315 percent. And the company boasts a staggering profit margin just a hair under 50 percent.
The company’s business model is an attractive one, and individual investors and institutions alike are using the platform to acquire cryptocurrencies, even with wildly fluctuating prices there.
Action to take: Shares are a long way from paying a dividend, but higher growth and a fat profit margin should lead to materially higher share prices in the coming year. With a number of analysts also getting bullish on shares, now looks like a good time to invest with the goal of outperforming the stock market in 2022.
For traders, the March $300 calls, last going for about $15.50, could lead to big returns in the next few months if shares continue to trend higher. Traders should look to grab mid-to-high double-digit gains.
Disclosure: The author of this article has a position in the company mentioned here, and may further trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.