While Snap tanks, Cloudera picks up momentum post-IPO
The Snap Inc. IPO had raised eyebrows on Wall Street with an extremely high-value IPO in February. Raising a few million on its first day on the public market, Snap had the highest tech company rating in years. Several analysts even compared it to the Facebook and Alibaba launches into the market. But recently, Snap doesn’t look much like a good investment. Just last week the company stock hit an all-time low, not a good thing for investors. And definitely bad news for those who had bought into tech companies following the Snap IPO craze.
However, there is one company that is redeeming tech companies. Based out of Houston, TX, Cloudera is a cloud storage and AI firm that operates in numerous markets around the world. According to Forbes, Cloudera works with about 500 of the largest 8,000 firms globally. The Big Data firm stated that it looked forward to tapping into the rest of those companies. And that is why Cloudera is currently at optimal performance even while Snap shares tank. It gives investors hope that at least not all tech companies are as volatile as Snap.
In April Cloudera had debuted on the New York Stock Exchange with a big bang. It’s not every day that a company exceeds its initial IPO pricing like Cloudera did. Cloudera had thought it’d sell its 15 million common shares between $12 and $14 apiece. Instead, most of its shares sold at$15, above the range. By the end of the first day of trading, Cloudera stock was +20.7% of that amount. And since then, the tech company’s stock have traded steadily at the increased price of about $18.10.
Cloudera is one of those companies that are placed so strategically in the market that they are hard to ignore. Not that such firms don’t have their own problems. Cloudera itself suffered a down round during its IPO when its valuation dropped from a $4.1 billion private valuation from 2014 to the $1.9 billion valuation it had just before it started trading publicly. But if you look at it from a market point of view the drop in valuation is just one small part of a very positive bigger picture.
If Cloudera’s earnings for the first quarter of this year are any indication, the firm is on its way to competing with big names. Cloudera’s revenue rose by more than $100 million between the first quarters of 2016 and 2017. The firm also decreased its net losses in that period, and that’s another thing going for it. But the one factor that Cloudera had in common with snap (if you look past the industry) is that they both sold themselves to investors with the promise of earning money. Snap didn’t make good on that promise, but it looks like Cloudera will.
The CEO of Cloudera, Tom Reilly, said that the company’s greatest advantage in a competitive tech market was its growth potential. “We’ll have lots of data to process by 2020,” Reilly noted. His statement was backed up by a Big Data Maturity Survey which showed that 97% of all existing data companies would expand by that time. It’s going to be a big market, and Cloudera, with its tech and partnerships, is in just the place to take advantage of it.