When Angie’s List (NASDAQ:ANGI) — an online company providing reviews for contractors — launched its IPO last November, it posted a nice 25% gain on its first day of trading. The offering came off the strength of Groupon‘s (NASDAQ:GRPN) IPO, which also enjoyed a good performance.
Unlike Groupon, Angie’s List was able to keep up the momentum through its first quarterly earnings report.
ANGI shares gained 7% Thursday after the company announced a 70% surge in fourth-quarter revenues, to a Street-beating $27.4 million, and saw its membership base increase 78% to 1,074,757. While the company did post a $5.87 million (14 cents per share) loss, that was better than the year-ago period’s $8.24 million loss.
Angie’s List also pleased investors with its current-quarter revenue forecast — ANGI expects revenues of $29 million to $30 million, vs. analysts’ expectations for $28.4 million.
Another reason for optimism came from an encouraging metric: cost of customer acquisition. During the past year, the average cost sank from $60 to $51, meaning Angie’s List is starting to realize economies of scale.
Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “The Complete M&A Handbook”, “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli or reach him via email. As of this writing, he did not own a position in any of the aforementioned securities.