The hardest thing to do in investing is to find a quality stock that will be a top performer over many years.
We can easily identify the big winners of the past but what will be the winners of the future? While it is very easy now to look back at names such as Apple (AAPL) and Amazon (AMZN) and think that they were obvious, it is much harder task to perform on a prospective basis.
One name that I believe may have the capacity to be a significant winner is TaskUs (TASK) . TaskUs is a recent IPO that provides outsourced customer service for leading companies in social media, e-commerce, gaming, streaming media, food delivery, ride-sharing, FinTech, HealthTech, etc. It has 27,000 employees in 18 locations around the world, with its largest office in the Philippines.
TaskUs is the company that many leading companies hire to do the many labor-intensive tasks they do not want to perform in house. It is cheaper to contract this work out to a company like TaskUs.
The company's largest customer is Facebook (FB) . TaskUs moderates content for Facebook and provides a wide variety of other services. For Zoom (ZM) , TaskUs was brought on board to deal with a huge jump in requests for customer service. For Uber (UBER) , the company was used to review and onboard drivers. Its second-largest customer is DoorDash (DASH) , and it also provides customer service for Netflix (NFLX) and Coinbase (COIN) .
Revenue for TaskUs grew 33% in 2020 and, unlike most other recent IPOs, the company is profitable. It produced $34 million in net income last year. It is unusual to find a "growth" stock with the potential for revenue increases that is already making money.
TASK shares IPO'ed at $23, and the stock quickly shot to almost $33. It is now developing a trading range as it awaits initial coverage in a couple of weeks from its underwriters Goldman Sachs and J.P. Morgan.
TASK is a play not only on growth in market stars like Facebook, Uber, etc., but is also a play on the outsourcing of services so that companies can better focus on the core competencies. With the company already profitable and the likelihood of substantial growth, I think it will attract substantial attention once it has coverage and issues its first public earnings reports.
The stock has been in a trading range with support around $29. I'm looking for a new closing high to bring in buyers that want to be on board into initial analyst coverage.