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Why TaskUs Is Up 17% Wednesday

By James Brumley – Aug 11, 2021 at 12:35PM

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The newly minted stock is responding well to last quarter's growth...perhaps too well.

What happened

Shares of online customer service outfit TaskUs (TASK 4.59%) are up 17.5% at midday today following the release of the company's second-quarter results. Revenue improved 57% year over year, driving even bigger growth in operating EBITDA.

So what

For the three-month stretch ending in June -- its first quarter as a publicly traded entity -- TaskUs turned $180.0 million worth of sales into adjusted EBITDA of $44.1 million, up from the year-ago comps of $144.4 million and $26.4 million, respectively.

Rising bar chart, with arrowed trend line.

Image source: Getty Images.

The current quarter should be similarly impressive. The company is guiding for a top line of between $182.0 million and $186.0 million, which would translate into around 50% year-over-year growth. It expects its EBITDA margin rate to contract just a little before recovering during the final quarter of the year.

Now what

Unusually for a recently IPO'd company, not only are shares of TaskUs trading above their initial public offering price of $23.00 per share, but the current price (near $37.00) pushes the stock above its post-IPO surge to a high of $32.94 and also its late-June peak of $35.62. The unlikely bullishness is almost intoxicating.

And that's the rub for this relatively unfollowed, unknown, and thinly traded name. There's plenty of profit-taking potential that's yet to play out, particularly in light of the stock's opening gap on Wednesday. Would-be buyers may want to let the dust settle on this still-volatile name before venturing in.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Stocks Mentioned

TaskUs, Inc. Stock Quote
TaskUs, Inc.
$21.18 (4.59%) $0.93

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