15 Best New Tech Stocks To Invest In

12. Ibotta Inc. (NYSE:IBTA)

Market Capitalization as of January 21: $2.21 billion

Number of Hedge Fund Holders: 17

Ibotta Inc. (NYSE:IBTA) is a technology company that operates the Ibotta Performance Network (IPN), which is a platform that connects packaged goods brands with consumers through digital promotions. This platform enables brands to deliver targeted promotions to consumers while offering valuable rewards to users.

In the third quarter of 2024, the company’s largest growth driver was the rapid expansion of its IPN, with redeemers increasing 63% as compared to the year-ago period. This led to a record 15.3 million redeemers and nearly 100 million total redemptions, contributing to a 32% year-over-year increase in redemption revenue. Redemption revenue accounted for 86% of total revenue.

The partnerships with Schnucks and Instacart are also pivotal. Schnucks, deployed in a record 90 days, is live at 115 locations, while Instacart is expected to be fully integrated by year-end. These partnerships integrate Ibotta Inc.’s (NYSE:IBTA) digital offers into their platforms, which enhance consumer savings opportunities. Schnucks features Ibotta Inc. (NYSE:IBTA) offers through electronic shelf labels, while Instacart is expanding offers to all its customers. These advancements are expected to drive increased investment from both large and emerging brands, and hence drive growth at the company.

Baron Small Cap Fund reiterated its confidence in the company’s leadership in consumer rewards despite short-term headwinds. This increased its position at an attractive valuation due to new partnerships and a strong growth outlook. Here’s what the firm said regarding Ibotta Inc. (NYSE:IBTA) in its Q3 2024 investor letter:

“Ibotta, Inc. (NYSE:IBTA) stock traded down in the quarter, due to short-term headwinds (primarily in display advertising, which is not an area of focus for the company). We retain conviction that Ibotta will remain the leader in consumer rewards and incentives, with multiple drivers to reach greater than 20% revenue growth per year and strong incremental profitability. Beyond continued initiatives in ramping their partnership with Walmart, Ibotta announced a partnership with Instacart, which validates our belief that Ibotta can be the aggregated platform for consumer incentives. We believe there is a strong pipeline of retailers and brands to join the Ibotta ecosystem. As a result, we added to our Ibotta position when the stock was trading at around 7 times next year’s EV/EBITDA, which we think is inexpensive for a market leader with a strong financial profile.”