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3 recent IPOs that have gone gangbusters

Whilst there hasn’t been a blockbuster IPO for a little while now, in the last few months a number of smaller companies have landed on the Australian share market and gone largely unnoticed.

Here are three notably strong performers which could be worth keeping a close eye on:

The ELMO Software Ltd (ASX: ELO) share price has risen 17.5% since hitting the ASX boards at the end of June at a listing price of $2.00. ELMO is a software as a service company, providing cloud-based talent management software solutions to customers such as Bank Australia, Elders Ltd (ASX: ELD), and Grant Thornton. The company’s HR software is designed to provide organisations with a centralised approach to managing an employee’s lifecycle from hire to retire. According to Frost & Sullivan, the global market for human capital management solutions is expected to be worth approximately US$15.4 billion by 2018. This gives the company a sizeable market opportunity and arguably makes it one to watch.

The Moelis Australia Ltd (ASX: MOE) share price has risen a remarkable 81% since its IPO in the middle of April. It’s not hard to see why the financial services company’s shares have rallied so strongly. At the end of June Moelis upgraded its full-year underlying EBITDA guidance to $29 million. This is a 25% increase on its IPO Prospectus forecast of $23.2 million. Further to this, the company has forecast full-year earnings per share of 16.5 cents. Which means its shares are changing hands at approximately 25x forward earnings now. I feel this makes its shares about fair value now.

The Oliver’s Real Food Ltd (ASX: OLI) share price has gained 85% since landing on the ASX towards the end of last month. Whilst I’m a big fan of the company and believe organic healthy fast food is a great idea, at 33x forward earnings I feel its shares are fully valued now. As I said last week, I see a lot more value in the shares of unhealthy fast food rivals Domino’s Pizza Enterprises Ltd. (ASX: DMP) and Collins Foods Ltd (ASX: CKF) right now following Oliver’s strong gain.

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Motley Fool contributor James Mickleboro owns shares of Collins Food Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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