Fiverr International Ltd. [NYSE: FVRR] went public yesterday and soared on its first day of trading. Well readers, it is IPO season and several IPOs have recorded significant gains in the past month. The latest IPO to record huge gains on market debut is Fivver. The company hit the market and opened for trading yesterday at $26 and closed the day at $39.90. It recorded a 90% gain in value in one day. Looking at its pre-market price action, Fivver looks set to continue with Thursday’s bullish price action. The company is currently trading up a bit in pre-market. If it opens the day’s trade in the green, it might break yesterdays high at $41.68, which is a key resistance point to break. If it breaks these levels it could stay in the green on Friday trading.
According to the company’s CEO, Micha Kaufman, Fiver is operating in a high growth market. Kaufman recently stated that the freelance market is worth $100 billion, in the U.S, and much more globally. In his view, it is comparable to e-commerce in 1995. This is an assurance to investors that Fivver is a in a good position to make money in the long run. Fivver has already established itself as a strong brand in the freelance industry. The company has about 200 freelance categories and connects freelancers in roughly 160 countries.
From a look at Fivver’s S 1 filing, the CEO’s projection of growth makes a lot of sense. In the 2018 financial year, Fivver did about $75 million, roughly a 44% increase in revenues from its 2017 figures. The company’s quarterly revenue growth (yoy) is also quite high, and stands at about 41%. On top of that, Fivver’s EBITDA, a key revenue growth indicator is moving towards positive territory.
The CEO also believes that there is enough market for all the players in the industry. In his view, the company’s main competition is offline, and not other online platforms. Fivver intends to take this market by offering an efficient platform for matching freelancers. Fivver wants to make contracting freelancers online as easy as it is to buy products on platforms like Amazon [NASDAQ: AMZN]. If Fivver can achieve its growth projections, then its exponential value growth can be justified. That’s because, as its market presence grows, likely its revenues will as well, and the value of its stock.
The market has shown it likes FVRR from the strong start it had on its IPO yesterday. However, the chart will paint the picture in the coming days and weeks as to where this company is heading short term technically. Regardless, this is one stock to keep an eye on short term.