About a year ago, a friend told me about a relatively unknown industry, 3-D printers. As an artist, his fascination was that these products could potentially be used to build an entire house. Little did I know at the time that the sector would become one of the best investments over the following 12 months, including a company that commenced its initial public offering in February of this year, ExOne Co (NASDAQ:XONE).
As a stock researcher, I am not usually a watcher of initial public offerings. Their valuations are hard to determine, as many are still in the startup phase. That said, correctly timed investments in new issues can be lucrative. I would like to share the IPOs that I have been most interested in so far in 2013, starting with the aforementioned ExOne Co (NASDAQ:XONE).
The latest 3-D printing stock
Shares of ExOne Co (NASDAQ:XONE) were priced at $18 on Feb. 15. A total of more than 6.3 million shares was offered, netting more than $101 million. About 5.3 million shares were issued, netting a total of $95 million. Since that time, the company’s value has skyrocketed to around $670 million. After all, this is a firm residing in the same industry as 3D Systems Corporation (NYSE:DDD) and Stratasys, Ltd. (NASDAQ:SSYS), two others that have gained the attention of investors during the past couple of years.
The two previously existing industry players are already solidly profitable. Although ExOne Co (NASDAQ:XONE) is yet to post positive earnings, it is well on its way to turning a profit. For instance, 3D Systems Corporation (NYSE:DDD), since its initial stock issuance about two years ago, has improved its bottom-line performance considerably.
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To meet its goal of gaining a global customer base through the development of new printer capabilities and expansion to additional product markets, management intends to construct production service centers. Currently it operates centers in the U.S., Germany, and Japan. Priorities include increasing the number of materials that may be utilized, as well as the job sizes. Investors willing to endure near-term volatility could still benefit in the long haul, even at the inflated valuation.
Looking to improve money-transfer technologies
A second company that debuted in February was Xoom Corp (NASDAQ:XOOM) priced at $16 a share. The company sold 6.3 million shares, raising roughly $101 million. The stock jumped to $26 after the first day, but was recently trading at $20.56.