Shares of AONE were up over 30% earlier this year, but are now sitting below their initial offering price at $10.11. Here’s my AONE stock forecast and why this might be a hidden diamond.
What Is AONE?
First off, it’s important to know what AONE (NYSE: AONE) is. AONE is a San Fransisco-based SPAC (Special Acquisition Company) that is set to acquire Markforged this summer. Markforged is an A.I. powered 3D printing, industrial manufacturer that uses complex software.
Markforged brings cutting edge technology to help modern manufacturers function as efficient as possible. They focus on reducing both massive amounts of time and costs of production by implementing their systems.
Additionally, AONE is set to reverse-merge on the NYSE market under the ticker “MKFG”. The valuation is expected to be somewhere between 2-3 billion.
Markforged is no new company. They’ve been developing for over 8 years, refining their softwares/components and have finally decided to join the market.
Their timing, however, couldn’t be worse. SPACs are currently at all time lows after facing heavy scrutiny. There has been a great rotation from speculative, growth stocks to large-cap, trusted stocks recently. AONE has been no exception to this rotation and has lost all of its momentum since its October IPO (Initial Public Offering).
Despite its recent price movement, Cathie Wood of ARK Invest has been heavily buying 3D disruptors and recently started purchasing AONE. Investors can be confident knowing that Markforged is not untrustworthy or extremely speculative.
On the bright side, AONE has most likely gone through the worst of the SPAC disdain already. Hopefully by the time their merger takes place, SPAC trust has once again started to solidify. Either way, investors who plan to invest in Markforged now have a great entry point if they did choose to get in before the merger.
Growth And Expansion Of Markforged
First, it’s important to mention just how applicable Markforged is to the real world in general. Markforged intends to disrupt the industrial automation, aerospace, defense, automotive, medical, and space exploration industries. Anywhere that requires world class levels of refinement can benefit from Markforged.
Additionally, Markforge’s software grows with each application. The A.I. driven software learns and improves as it continues to be applied. The more contracts and use of Markforged software, the more efficient and refined it will become.
Markforged currently has over 170 issued/pending patents for their software and utilities. They are an innovative disruptor in an exponentially growing industry and are preventing replication as well.
Currently, Markforged just hit $70 million in revenue for year 2020. They expect this to grow 10 fold and hit $700 million by 2025. In 2020 alone, they had 55%+ growth of gross margin before being listed on a stock exchange.
The 3D printing company currently has 9 different printers and several different softwares. Their capabilities unlocks the range of new applications across 14 proprietary materials.
They already have many bluechip customers as well and are actively looking for more. Right now, their TAM (Total Addressable Market) sits at $18 billion. They expect this to reach $118 billion by 2029 as demand and application for 3D printing sharply rises.
The company is profitable with $40 million in gross profit for year 2020. This helps remove some of the “speculative” reputation this is associated with SPACs. Markforged forecasts double digit net profit growth for the next 5 years at least.
AONE Stock Forecast And Price Targets
Markforged president and CEO claimed that Markforged has “been at the forefront of the additive manufacturing industry, and this transaction will enable us to build on our incredible momentum and provide capital and flexibility to grow.” Now might be the perfect time for investors to strike after Markforged has been beaten down these past few months.
Moreover, Markforged has been beating out its competitors before even being on the market. Compared to Desktop metals (NYSE: DM), Markforged had over 3 times the revenue. Moreover, Desktop Metals currently sits at a market cap of over $3 billion while Markforged’s merger has a valuation of $2.1 billion.
Desktop Metals was as high as a $6 billion market cap, but got recently beaten down due to the rotation away from growth stocks. The market share for Markforged is most certainly available for Markforged to grow into.
It’s hard to how long it will take for the momentum for Markforged to start, but it’s safe to say that now is a pretty early time to get in. AONE has largely gone unnoticed, but media attention will quickly snowball for it. SPACs don’t typically fall much below $10 pre-merger and AONE is currently at about $10.10.
This represents a pretty low risk high reward opportunity. If anything, AONE could be a decent store of cash at these levels with little downside.
My AONE stock forecast is bullish for the long-term. The SPAC might trade sideways for another month or two, but will most likely build momentum before the merger. For the long-term, Markforged could be a great opportunity.
- 6 Month Price Target: $14
- 1 Year Price Target: $18
- 3 Year Price Target: $54