RealD (RLD), whose 3-D technology was used in the budget-busting movie Avatar, had a successful IPO in July.
The company, based in Beverly Hills, Calif., priced its offering at $16, versus the expected range of $13 to $15.Shares of RealD, currently trading at about $25.60, have increased more than 33% since their first day of trading. RealD generates revenue from theater owners, who pay the company a license fee for using its technology. As of September, RealD had deployed around 9,300 screens with 3D-enabled technology around the globe, more than movie theater giants Regal Entertainment (RGC) and Cinemark (CNK). BMO Capital markets analyst Jeffrey Logsdon raised RealD's 9-to-15 month price target to $32, writing in a recent note: "RealD's expected rapid revenue growth, high and expanding operating margin, high returns on invested capital, and robust global market share should deliver impressive earnings and free cash flow for the foreseeable future."
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