Amplitude (AMPL) Stock

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Contributor, Benzinga
September 28, 2021
Last update: 6:59PM (Delayed 15-Minutes)
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Vol / Avg.0 / 496.104KMkt Cap1.368B
Day Range- - -52 Wk Range8.500 - 16.950

From 1984 through 1990, you could make the argument that “analog” advertising had reached its zenith. In the former year, information provided by the Pew Research Center reveals that weekday newspaper circulation hit slightly over 63.3 million units. In the latter, circulation for the Sunday paper reached 62.3 million. To support such an expansive enterprise, advertisers paid big bucks to hawk their products and services on influential showpieces.

Unfortunately for the industry, a paradigm shift loomed over the horizon. As the internet age entered its infancy stage, futurists envisioned an era where news and other content could be delivered on demand rather than be consumed on a predetermined schedule. Slow at first, the inevitable transition to digital media and e-commerce channels could not be denied. Between 2000 and 2020, weekday newspaper circulation plummeted over 56%.

To survive — and hopefully thrive — in the digitally dominated age, virtually every industry requires big data. However, the mere existence of data is not enough. Rather, companies must harness it to drive sales and innovation, the core business under analytics firm Amplitude. Through evidence-based insights, Amplitude empowers enterprises to make profitable decisions across their organizational structure, making its direct listing one of the most highly anticipated.

Amplitude Financial History

Big data didn’t just impose a paradigm shift in the advertising world. Indeed, the ability to decipher mountainous volumes of raw data into meaningful insights has become one of the most sought-after attributes in the modern age. According to Quince Market Insights, the research firm forecasts that the global data analytics market will reach a valuation of $24.63 billion in 2021.

Based on the critical functions of Software as a Solution (SaaS) applications toward smart analytics, industry experts anticipate that the sector will expand at a compound annual growth rate of 25% to 2030, implying a robust backdrop for AMPL stock. Adding to the relevance, other technology-dependent segments like the Internet of Things (IoT), machine learning and artificial intelligence among many others will benefit from data-driven processes, thus suggesting that these growth projections could be conservative.

For instance, the World Economic Forum estimated in 2018 that by 2022, “85% of companies will adopt data analytics and big data.” Not only does this dynamic present upside opportunities for AMPL stock, it sparks a vibrant ecosystem for next-generation jobs. Therefore, Amplitude backers are not just concerned about its equity unit’s immediate profitability but also toward the company’s positioning to dominate the analytics market.

It’s already taking several important steps per its financial performance. In the pandemic-disrupted year of 2020, Amplitude generated revenue of nearly $102.5 million, just a loose hair strand under 50% improvement over 2019’s tally of $68.4 million. Better yet, the SaaS firm pared down net losses in 2020 to $24.6 million from $33.5 million a year earlier.

So far, momentum has carried over into the current year. In the 6 months ending June 30, Amplitude posted top-line sales of $72.4 million, up over 57% against the comparative period in 2020. Net losses were virtually identical, with the company posting a loss of $16.5 million in the current half-year period as opposed to $16.6 million in the prior year.

Granted, the risk factor with AMPL stock is that in exchange for its premium, investors will want to see profitability, likely sooner rather than later. At the same time, the viable data analytics market gives Amplitude a workable chance to deliver the goods.

Amplitude Potential

Just on sheer interest from major financial backers, it’s difficult not to believe that AMPL stock offers substantial upside potential over the long run. Primarily, the underlying company raised $150 million through private funding campaigns, leading to a valuation just shy of $4.2 billion. Therefore, the upcoming direct listing of this SaaS unicorn — a company valued at over $1 billion — offers a chance for retail investors to ride a possibly lucrative wave.

Of course, much of the business appeal behind AMPL stock is that commerce at almost every level has gone digital. Rather than relying on hunches and intuition that could lead to disastrous corporate decisions, more organizations are relying on advanced analytics — the very kind that Amplitude provides — to deep-dive customers: who they are, what they want, even at what time they make their purchases.

While technology has certainly facilitated the ability for companies to exploit data, that same innovation has also sparked methodologies to combat its exploitation. As you know, data privacy represents a massive ongoing debate in the U.S., with a majority of Americans demonstrating concern about how corporations and government agencies use their data. Thus, legal headwinds may make life difficult for AMPL stock.

On the other hand, companies today are desperate to get an edge over the competition because of the severe economic impact of the COVID-19 pandemic. As regulations may hamper the current delicate situation, Amplitude might see a net benefit from outside fundamentals over the next few years.

How to Buy Amplitude (AMPL) Stock

If you already know how to buy stocks, you can jump right in. If not, follow the steps below.

Step 1: Pick a brokerage.

Step 2: Decide how many shares you want.

As mentioned earlier, direct listings can be particularly volatile. Therefore, it’s in your best interest to move forward with a balanced share count.

Step 3: Choose your order type.

Before placing your first order, learn these market concepts.

  • Bid: The buyer’s best offer for a stock.
  • Ask: The seller’s bottom dollar.
  • Spread: The bid-ask spread represents the market maker’s profitability margin and therefore risk.
  • Limit order: Buy or sell requests at a specific price, limit orders provide transparency but no execution guarantees.
  • Market order: Market orders guarantee fulfillment but only at the prevailing rate.
  • Stop-loss order: Stop-loss orders automatically exit your position at either a predetermined price or anything lower.
  • Stop-limit order: Stop-limit orders only exit positions at a specified price, but they carry non-fulfillment risks.

Step 4: Execute your trade. 

Follow these steps to execute a market order:

  1. Select your action type (buy or sell).
  2. Enter the shares you want to acquire (or sell).
  3. Hit the Buy (or Sell) button.

Follow the same sequence for limit orders (but include your execution price).

Big Brother for Big Profits

Data analytics has always navigated the fine line between necessity and permissibility. Naturally, digitalization requires some shared costs, with murky online privacy expectations being one of them. On the flipside, big data innovations have also engendered myriad conveniences, an undeniable factor that could support AMPL stock for many years down the line.

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