Ruckus Wireless (NYSE:RKUS), which provides gear for Wi-Fi installations, finished Monday with yet another continuation of its post-IPO rally thanks to a positive analyst report.
RKUS got got off to a horrible start when it went public in mid-November; it priced at $15, but ended the day at $12.25. Since then, Ruckus has rebounded by more than 50%, including a final jump of nearly 8% Monday.
His rationale is reasonable: The growth in smartphones and tablets will drive strong demand for Wi-Fi.
The company noted the powerful industry dynamics in its IPO prospectus. According to Infonetics Research, the market for Wi-Fi solutions is forecast to skyrocket from $296 million in 2011 to $2.8 billion in 2016 — a roughly 57% compound annual growth rate.
Ruckus is already benefiting nicely from the megatrend; during the past nine months, RKUS’ revenues have almost doubled to $152.5 million, and went from breakeven to earning $7.4 million.
Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of “How to Create the Next Facebook” and “High-Profit IPO Strategies: Finding Breakout IPOs for Investors and Traders.” Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.