3 Tech IPOs That Are Safe Deals for Investors

Congatec Holding, Mimecast and Instructure are safe IPOs in the tech market.
By William Craig ,

During the dot-com mania days of old, investors could spend money on an IPO and pretty much expect positive returns. Those days are long past, as that first tech bubble has burst. The IPO market is more normalized now, which means smart investors need to look ahead, investing in the long term rather than for a quick flip.

Even if you've been in the industry for a long time, finding a suitable IPO with a viable long-term return is difficult. Every investment has its own set of risks, and some of them are more dangerous to throw your money at than others. This can lead to a sort of cat-and-mouse game for investors who are constantly trying to earn more wins than losses, and no matter what you do, you will have some losses.

Therefore, every once in a while it's good to have a few safe IPOs to hedge your bets on. While it's true that no investment is ever a guarantee, there are definitely some sources out there that are safer -- and a lot less risky -- than others.

These three IPOs are safe bets that you might want to consider buying in when you have the opportunity.

1. Congatec Holding (CONG)

Congatec is a German-based embedded computing solutions developer and marketer. It has clients worldwide, including brands such as Siemens, General Electric and Bosch. In other words, it has a remarkably solid clientele for a company going public.

The company sought $60 million for its IPO on Nasdaq, with share prices to be set. With a price range midpoint set at about $11, it will see a market capitalization of $203 million. Underwriters include Stifel, Needham, Canacord and JMP Securities.

2. Mimecast (MIME) - Get Report

Mimecast is a London-based security and risk management firm that specializes in cloud computing and email. It offers services to corporations in the United States, United Kingdom and South Africa. Its total customer base includes more than 15,000 clients that are spread across 100 countries.

Mimecast filed for its IPO on Oct. 16, 2015, to raise about $85.25 million on Nasdaq. The underwriters include Barclays Capital, Goldman Sachs, Jefferies and RBC Capital Markets. It will have a market capitalization of about $594 million. It's offered 7.75 million shares now selling at about $10 each.

3. Instructure (INST) - Get Report

Instructure is a Utah-based online learning management platform for both corporate brands and academic institutions. It offers cloud-based services through its popular applications such as Canvas and Bridge. These services allow companies and educators to deploy face-to-face online learning experiences. Its customers include millions of students, teachers, employees and more, worldwide.

Instructure recently entered the market on a rather quiet note. It sold $4.4 million in shares at $16 apiece, which was near the bottom end of its price range of $16 to $18. At that price, the company has a net worth of $80.96 million. Underwriters include Morgan Stanley, Raymond James, Goldman Sachs, Jefferies, Needham and Oppenheimer.

Invest Now and Brace for the Long Haul

Even if you didn't get in during the initial public offering, you'll want to buy in when these stocks are trading on the exchange. This is especially true if you're a small-time investor or don't spend as much time investing as the professionals do.

These are the kind of safe investments you want to become a part of early, and then settle in and wait for the long haul.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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