In 2020 so far, a total of 43 companies went public by floating their shares on the Australian Stock Exchange through initial public offerings (IPO).
Although some of those companies are struggling to maintain their initial share price , other IPO shares have been strong performers.
Today I’m going to talk about the 3 best-performing companies from this group, all of which have seen their share prices increase markedly since their debut.
Douugh Ltd (ASX: DOU)
Neobank company Douugh first listed in early October at an oversubscribed IPO share price of 3 cents. It’s currently trading at 25 cents, giving investors a 733% return in just one month.
For those unfamiliar, neobanks perform almost identical functions to traditional brick-and-mortar banks, but do so exclusively online without physical branches.
The company’s core product is its AI-powered smart phone app and bank account that the it hopes will allow its customers to take control of their financial wellness. Significantly, the company entered into a global partnership with Mastercard in 2019.
Douugh is one of a handful of Australian neobanks with the likes of Volt, 86 400 and Xinja – none of which are currently listed on the ASX.
Cosol Ltd (ASX: COS)
IT services provider Cosol listed its shares on the ASX in January at an IPO share price of 20 cents. Today it is trading at 67 cents, a remarkable 235% increase in just 10 months.
Cosol’s main offering is the ABB’s Ellipse enterprise asset management (EAM) software solution powered by Hitachi. EAM is basically a process that manages the lifecycle of a company’s physical assets to maximise their use and economic return.
Cosol also has partnerships with solution providers SAP (NYSE: SAP) and IFS (NYSE: IFS), working largely in the mining industry.
It also recently acquired the US-based EAM specialist company AddOns for US$1.5 million. Cosol said the acquisition is in line with its ambitions of becoming a global player in EAM.
Of most significance, Cosol was awarded a $3.24 million contract in August by the Australian Department of Defence to manage the department’s EAM systems.
4DMedical Limited (ASX: 4DX)
Health technology company 4D Medical made its debut on the ASX in August at an IPO share price of 73 cents. It is currently trading at $2.25, which represents a 212% increase in three months.
4D Medical is an early stage lung imaging software maker. The company’s proprietary product is the XV Technology, which converts X-ray images into four-dimensional quantitative data. Its goal is to replace old technology such as X-ray and CT scans, which according to the company are ”out-of-date and not fit for purpose anymore”.
4D Medical’s main clients are obviously hospitals. Its main selling point to hospitals is that its software does not require any large capital expenditure, as the company is able to integrate its software with the hospital’s existing systems. 4D Medical charges a fee on a per scan basis, charging US$175 per test using the XV Technology.
As mentioned, the product is still at an early stage and needs to be commercialised on a mass scale.
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Returns as of 6th October 2020
More reading
- Douugh and Ioupay were among the most traded shares on the ASX last week
- Why the Douugh (ASX:DOU) share price is up almost 1000% since its IPO
- Douugh and Afterpay were among the most traded shares on the ASX last week
- Top ASX tech shares to buy in October 2020
- Why the 4DMedical (ASX:4DX) share price is reaching new highs
Motley Fool contributor Eddy Sunarto has no position in any of the 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 Scott Phillips.
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