Despite the falls on Wall Street yesterday, Israeli automated software updating company JFrog Ltd. (Nasdaq: FROG) had a memorable trading debut. The company's share price rose 47.25% on its first day of trading to close at $64.79, giving a market cap of $5.75 billion.
The only cloud on the horizon for the enterprise software company was a somewhat barbed recommendation by CNBC pundit and "Mad Money" host Jim Cramer. He said, "JFrog's another terrific company with a stock that is too hot to handle right now. It's sizzling. We get sell-offs and when we do maybe you can get this stock at a much less exorbitant price."
He added, "JFrog's business has a lot going for it. I think this is a great story. But the stock's giving me vertigo."
Cramer insists that above $60 is not an attractive price and recommends buying JFrog if the share price returns to the high $40s.
According to JFrog's prospectus, revenue grew 65% to $105 million in 2019, and revenue in the first half of 2020 was $69 million, up 50% from the corresponding period of 2019. JFrog is still not profitable but its losses have been narrowing - from $26 million in 2018 to $5.4 million in 2019 and just $426,000 in the first half of 2020 compared with $2.1 million in the first half of 2019.
Cramer sees JFrog becoming profitable in 2021.
JFrog was founded in 2008 by CEO Shlomi Ben Haim, CTO Yoav Landman and chief data scientist Fred Simon. The company has developed 'liquid software' that allows users to implement routine updating of their software. The founders and two venture capital investors sold some of their stake in the IPO.
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