I have started to invest in a small-cap growth company, Xometry ($XMTR). The approximate market cap is $5.6B. The company operates an artificial intelligence (AI) powered online manufacturing marketplace in the United States and abroad. Its marketplace uses AI to assist buyers in sourcing custom-manufactured parts and assemblies. It then obtains pricing and lead times.
Reasons to buy:
- Revenue continues to grow at a high rate, about 29% trailing 12 months.
- Analysts expect Q2 revenue to increase about 32% YOY and EPS to grow about 62%.
- The company has transitioned toward profitability after years of investing for growth.
- Its AI-powered manufacturing marketplace benefits from network effects between buyers and suppliers, creating a competitive advantage.
- The recently announced partnership with Siemens expands enterprise distribution and customer acquisition opportunities.
Buying Plan:
- I have started to buy from $99.
- My preferred accumulation range is when it pulls back towards the 50-day moving average on lighter trading volume.
Key catalysts:
- Q2 earnings report is on August 4.
- Continued enterprise customer wins.
- Additional AI platform adoption.
- Further operating margin expansion.
- Recently Ygal from Wedbush initiated a buy rating of $126.
- Forecast: revenue growth of 27.64% and EPS growth of 91.08%.
Revenue forecast:
EPS forecast:
Source: Stockanalysis.