If you snapped up some of the hottest debutantes over the past year, you made a lot of money. You more than tripled your investment if you were able to get in on the IPOs for Palantir Technologies (NYSE: PLTR), Lemonade (NYSE: LMND), and fuboTV (NYSE: FUBO).
The year's hottest U.S. IPO fared even better, and even after a scintillating start it's not household name even among diehard investors. Let's take a closer look at three of the market's biggest winners, with the gains they posted as we head into the final abridged trading week of 2020. We'll cap things off with the top U.S. debutante.
Palantir -- up 287%
Palantir wasn't a rock star out of the gate. The data analytics provider went public at $7.25 in late September, closing higher -- but still in the single digits -- on its first day of trading. Palantir stock took nearly four weeks before closing above $10, but it hasn't looked back since its ho-hum start.
The data-mining specialist continues to sign new government deals or extend existing partnerships. It also only helps that Palantir reported better-than-expected 52% in revenue growth for its first quarterly report as a public company. Clients are happy, as average revenue per customer is up a healthy 38% year to date compared to where it was a year earlier. Palantir sees its top line rising 42% to 44% this year and 30% come 2021.
Lemonade -- up 331%
The market lined up at the Lemonade stand for the next-gen insurance provider's IPO. The stock more than doubled from its $29 debut price on its first day of trading this summer. Lemonade offers policies for property renters and homeowners. It has also expanded into pet owner policies.
Lemonade leans on artificial intelligence chatbots to offer quotes online. A different AI chatbot can initiate and sometimes even complete the claims process at the other end. Lemonade is resonating with young customers who are early in the rental or home buying process. Its customer base has grown by 67% to 941,313 policy holders over the past year.
FuboTV -- up 342%
One way to win the IPO game is to underpromise out of the gate. When fuboTV was gearing to go public a few months ago it was targeting just 410,000 to 420,000 paid subscribers to its live TV streaming service by the end of the year. It wound up shattering that goal by the end of its third quarter, and it has jacked up its target twice over the past three months.
There are now 455,000 customers paying at least $65 a month for the platform that rivals YouTube TV and Hulu + Live TV in channel content with a larger emphasis on sports content. It expects to top 500,000 for the period that ends later this week. Revenue soared 71% in its first quarter as a public company. Subscription revenue is growing fast, and ad revenue is growing even faster.
Not everyone is convinced that the sports-first platform is going to win this game. One notable analyst believes that the stock should actually be trading for less than its $10 IPO price. We're still in the early innings, but you have to like the way fuboTV is swinging for the fences.
Greenwich LifeSciences -- up 583%
Palantir, Lemonade, and fuboTV were big winners in 2020, but their blazing returns pale in comparison to Greenwich LifeSciences (NASDAQ: GLSI). The surprising and ultimately inspiring aspect to this new offering is that it didn't hit the market with any kind of fanfare. The upstart biotech made its Wall Street debut in late September. Underwriters priced the small IPO at $5.75, and that's exactly where it opened on its first day of trading.
Things only got worse after that through the stock's first few weeks on the market. Greenwich LifeSciences closed its first day of trading at $5. It remained a broken IPO -- trading as low as $3.26 in early November -- until finally cracking the $5.75 ceiling in early December. The shares exploded a week later, after the company announced positive clinical results for its GP2 immunotherapy candidate. A presentation at a breast cancer symposium detailed the encouraging results for patients in the study after undergoing surgery for tumor removal. The shares retreated a few days later after Greenwich LifeSciences took advantage of its buoyant stock price to issue a spot secondary, but it remains the best performing debutante in the country as of the morning of Dec. 28.
There are big risks when it comes to IPO investing. Those who got in early on Palantir, Lemonade, fuboTV, and Greenwich LifeSciences are naturally glad they took the chance in 2020.
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Rick Munarriz owns shares of fuboTV, Inc. The Motley Fool owns shares of and recommends Lemonade, Inc. The Motley Fool owns shares of Palantir Technologies Inc. The Motley Fool recommends fuboTV, Inc. The Motley Fool has a disclosure policy.
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