This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Does Profit Even Matter? Investing Ideas from the Not So Secret Candy Crush IPO

But you also need a pretty high return in order to incentivize investors toward IPOs, which are pretty risky investments. The public doesn't know much about these new stocks, and they don't have a proven track record. 

Investing Ideas

We decided to take that list of stock IPOs with the biggest pops on their first day of trading, and screen it for those already profitable early in 2014. Of the list of 15 companies, only two, Noodles & Co (NDLS) and Sprouts Farmers Market (SFM) have actually turned a profit. And they were slim ones, at 1.3% and 2.7% respectively. 

So we expanded our screen by looking instead at operating margin. Operating margin is similar to profit margin, in that it looks at the ratio between costs and sales. But it doesn't account for fixed payments like interest on debt. 

Just five of 2013's IPOs with day-one pops above 15% remained on our list, with operating margins above 1%.

Click on the interactive chart to view data over time. 

1.Cvent, Inc. ( CVT):A cloud-based company, provides various solutions for events and meetings value chain primarily in North America. Market cap at $1.15B, most recent closing price at $38.88.

Pop: 56.8%

Operating Margin: 1.3%

 

2.Tableau Software, Inc. ( DATA):Provides various business analytics software products in the United States, Canada, and internationally. Market cap at $5.79B, most recent closing price at $97.93.

Pop: 63%

Operating Margin: 1.6%

 

3.Noodles & Company ( NDLS):Develops and operates fast casual restaurants. Market cap at $1.11B, most recent closing price at $37.82.

Pop: 104%

Operating Margin: 3.1%

 

4.Potbelly Corporation ( PBPB):Owns and operates Potbelly Sandwich Works sandwich shops in the United States. Market cap at $96.74M, most recent closing price at $22.66.

Pop: 119%

2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 17,928.20 -142.20 -0.79%
S&P 500 2,089.46 -25.03 -1.18%
NASDAQ 4,939.3270 -77.6020 -1.55%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs