ELMO Software Ltd shares are up 90% since their IPO

The ELMO Software Ltd (ASX: ELO) share price continued its strong run on Wednesday and reached a new all-time high of $3.80.

This means the cloud-based talent management software solutions company’s shares have now rallied over 90% since listing on the Australian share market at $2.00 per share in June.

Why have investors been snapping up shares?

Investors appear to have been impressed with ELMO’s performance in FY 2017 and it isn’t hard to see why.

In FY 2017 pro forma revenue came in at $17 million, up 26% year-on-year and 4% ahead of its prospectus forecast.

Its earnings growth, however, was even stronger. Pro forma EBITDA was $1.2 million, a massive 42% ahead of its prospectus forecast.

Pleasingly for its shareholders at the end of last month management confirmed its FY 2018 guidance for revenue of $21.5 million and EBITDA of $2.7 million.

This will be an increase of 26.4% and 125%, respectively, year-on-year.

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Motley Fool contributor Motley Fool Staff has no position in any stocks mentioned. 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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