After a red-hot quarter, internet of things (IOT) developer Samsara is going public Wednesday, Dec. 15. Appropriately, it will start trading under the IOT ticker. Preliminary estimates suggest the firm will grab a $11.6 billion valuation, meaning that IOT stock is in for a hair-raising week.
Samsara is actually a pioneer of the industrial internet of things (IIOT) market, which attaches commercial machines and equipment with automatic, cloud-connected sensors or cameras that relay data to relevant operators. The technology is rapidly improving and has already been adopted by some big names. Many suspect IOT integration will only continue to expand, setting Samsara up for further success. In fact, the Financial Times named the company the No. 2 fastest-growing company in America between 2016 and 2019.
Perhaps Samsara’s success is unsurprising to investors. Why? IOT is quickly becoming a quality-of-life necessity for many companies. The technology provides efficient, safe and consequently, cost-saving solutions in many common industries. Samsara’s platform is capable of identifying risk factors in a commercial workplace, preventing accidents before they happen. This could be a lifesaver for companies known for devastating and numerous workplace incidents (ahem, Amazon).
Let’s see what’s in-store for the high-growth cloud company on issuance day.
What Is the Samsara (IOT) Stock IPO Price Range?
The California-based company predicts an opening price range between $20 and $23, and plans to offer 35 million Class A shares.
And beyond the IPO date and price range for Samsara, how should potential investors evaluate IOT stock? It operates in an industry expected to be worth nearly $740 billion in 2025, but it also faces competition. Samsara acknowledges that it faces off against Verizon (NYSE:VZ) as well as private firms like Geotab, Lytx and SmartDrive.
Importantly, Samsara’s numbers paint a bright picture. It reported revenue for 2020 of $249.9 million, more than double that of the year prior. Continuing to build on that, it announced in October that revenue for the year-to-date was $302.6 million. That figure is up nearly 75% year over year.
Jim Morrish, an IOT industry analyst, commented on Samsara’s competitive advantage:
“Samsara stands out in the way that it has integrated many capabilities into a single platform, including AI and image analysis. Adopting a single supplier for fleet management applications simplifies procurement and the management of the enterprise technical environment, and helps to avoid data silos.”
It’s clear that to some, IOT seems a strong option for a fast-growing, financially sound investment. Keep an eye out Wednesday to see if Samsara will sink or swim in the face of investor expectations.
On the date of publication, Shrey Dua did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
