Our Fair Value analysis has once again demonstrated its effectiveness in identifying market opportunities, this time with NASDAQ:XMTR. When our models identified Xometry as significantly undervalued in March 2024, the stock was trading at $18.00. Today, it stands at $32.18, delivering a remarkable 79% return in just eight months. This success story exemplifies how our Fair Value methodology helps investors identify promising opportunities, with our current top picks available on our Most undervalued list.
Xometry operates an AI-powered marketplace for on-demand manufacturing, connecting customers with manufacturers globally. When our analysis flagged the stock, the company was showing promising fundamentals despite trading at depressed levels. At the time, Xometry had generated $463.4 million in trailing revenue, and while still unprofitable, demonstrated strong potential through its AI-driven pricing engine and high customer retention rates exceeding 95%.
The stock's subsequent performance has validated our analysis. From the March identification point, Xometry's shares embarked on a steady upward trajectory, particularly accelerating in recent months. The company has continued to execute on its growth strategy, with revenue expanding to $525.1 million and earnings per share improving from -$1.41 to -$1.05.
Recent developments have further supported our initial thesis. In its latest quarter, Xometry reported record revenue of $141.7 million, representing a 19% year-over-year increase. The company achieved record gross profit margins of 33.6% and is now targeting adjusted EBITDA profitability by Q4 2024. Analyst coverage has remained largely positive, with several firms raising their price targets following strong results.
Our Fair Value methodology combines multiple valuation approaches, including discounted cash flow analysis, comparable company metrics, and market sentiment indicators. In Xometry's case, our models identified a significant disconnect between the company's fundamental value and its market price, projecting an upside of 62.56% that has since been exceeded.
The success of this Fair Value call demonstrates the power of data-driven investment analysis. Through InvestingPro, investors can access our comprehensive suite of valuation tools, real-time alerts, and expert analysis to identify similar opportunities. With features like financial health scores, peer comparison tools, and proprietary valuation metrics, InvestingPro helps investors make more informed decisions in today's dynamic market environment.
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