Newly listed companies prove as attractive businesses with steady growth visibility
For investors as well as traders, it’s important to keep a close eye on initial public offerings. It presents an opportunity to consider exposure to new companies with an attractive business model and growth outlook. At the same time, traders can therefore benefit from recent IPOs if the listing price is attractive.
On April 25, Loar Holdings (NYSE:LOAR) listed after an IPO at $28. Currently, the stock is higher by almost 85% at $51.5. This is just one example from the recent listing. Multiple other ideas are worth considering for quick gains.
Notably, the U.S. IPO market activity has been strong in Q1 of 2024 with companies raising $8.7 billion. A closer look at new listings might give investors an opportunity to buy potential multi-bagger ideas. For now, let’s discuss three new ideas that can deliver 100% returns within the next three months.
PACS Group (PACS)
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PACS Group (NYSE:PACS) was listed last month. Against an IPO price of $21, PACS stock currently trades higher by 34.3% at $28.55. However, the stock seems attractively valued at a forward price-earnings ratio of 19.2. I am bullish on a significant rally from present levels after the company’s Q1 of 2024 numbers and the full-year guidance.
As an overview, PACS Group is a provider of post-acute healthcare facilities. The company operates over 220 post-acute care facilities across nine states. Also, PACS Group provides senior care facilities.
Importantly, the post-acute care provided by the company has an average cost per day of $550. This price tag is significantly lower when compared to hospitals or inpatient rehabilitation facilities. PACS’ competitive advantage is likely to ensure that the demand for the company’s services remains robust.
Further, PACS Group was founded in 2013 and is operational in only nine states. Ample scope for expansion of SNF (skilled nursing facility) exists for the coming years. Therefore, revenue and EBITDA growth is likely to remain strong. For 2024, the company has guided for 19% revenue growth year-over-year (YOY).
ZEEKR Intelligent Technology (ZK)
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ZEEKR Intelligent Technology (NYSE:ZK) is involved in the sale of electric vehicles (EVs) and batteries in China. With an attractive product portfolio coupled with focus on innovation, I am bullish on ZK stock.
Currently, ZK has a portfolio that includes ZEEKR 001, ZEEKR 001 FR, ZEEKR 009, ZEEKR X and an upscale sedan model. Between October 2021 (commencement of operations) and December 2023, the company has cumulatively delivered 196,633 vehicles.
Amidst intense competition, innovation is likely to provide an edge to ZEEKR Intelligent Technology. For example, it established partnerships with several internationally renowned software companies. This includes of Mobileye and Waymo.
And, the investment in R&D is likely to support future mobility products including robotaxis and logistics vehicles. Therefore, ZK is still at an early-stage of growth.
Viking Holdings (VIK)
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The initial public offering of Viking Holdings (NYSE:VIK) had witnessed strong demand and was 15x oversubscribed. It’s not surprising that the listing has been strong, so expect further upside.
Viking Holdings is a travel company with a fleet of 92 ships. Between 2015 and 2023, the company’s revenue and adjusted EBITDA grew at a CAGR of 14.4% and 16.3%, respectively. This is healthy considering the negative impact of the pandemic.VIK ended 2023 with revenue and EBITDA of $4.7 billion and $1.1 billion, respectively.
Additionally, the company has a total river and ocean order book of 36 ships to be delivered through 2030. This will ensure steady growth in the coming years. With travel demand returning to pre-pandemic levels, the growth outlook is optimistic.
Further, Viking Holdings derived 90.5% of guest revenue from North America. However, 50% of all cruisers globally are from markets outside North America. The company is looking at markets in India, Singapore and Nordic countries to boost passenger traffic. Therefore, with a positive outlook for growth, VIK stock is likely to remain in an uptrend.
On the date of publication, Faisal Humayun did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
