Before the Cloudera IPO Date, Here's the $902 Million Profit Play Wall Street's Ignoring

Cloudera Inc. filed paperwork for a public offering on March 31, and it will be the next big IPO hyped by Wall Street because of its $4.1 billion valuation.

However, there's something Money Morning readers need to know before the Cloudera IPO date: There's a profit play through the Cloudera IPO that Wall Street is ignoring.

Wall Street may be ignoring this profit play, but Money Morning readers will be rewarded for having this potential double-digit profit opportunity on their radar.

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What Is Cloudera?

I'll get to the best way to play the Cloudera IPO in just a bit.

Right now, I want to make sure our readers are caught up with the most important facts from the Cloudera IPO filing paperwork.

The Most Important Facts to Know Before the Cloudera IPO Date

For its fiscal year ended Jan. 31, 2016, Cloudera generated $166 million in revenue. For its fiscal year ended Jan. 31, 2017, Cloudera generated $261 million in revenue.

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That's year-over-year (YoY) revenue growth of 57%.

However, Cloudera is far from profitable. Its net losses were $187.32 million for 2017 and $203.14 million for 2016. While losses narrowed 7% from 2016 to 2017, the company is still losing hundreds of millions of dollars every year.

We also learned from the IPO filing the Cloudera stock symbol. The ticker will be "CLDR," and the company will trade on the New York Stock Exchange (NYSE). On the official IPO date, the software company will trade as Cloudera Inc. (NYSE: CLDR).

While we know the stock ticker, a Cloudera IPO date hasn't been set. But when the company does go public, we recommend Money Morning investors avoid purchasing shares of CLDR.

Cloudera IPO dateThat's because after the hype dies down, IPO prices are extremely volatile. For example, shares of Snap Inc. (NYSE: SNAP) opened at $24 per share on its March 2 IPO. But roughly two weeks later, shares of SNAP traded at an intraday low of $18.90 on March 17.

For early investors, that was a loss of 21.25%.

We're focused on a safer investment strategy for the Cloudera IPO. And not only is this investment strategy safer, it could provide market-beating gains of 23%. While Wall Street might shrug off these gains, we'll always take safer double-digit profit opportunities over whatever "buzz" Wall Street is selling.

That's because one company you could invest in right now has $902 million worth of Cloudera shares.

Here's everything you need to know about the profit opportunity Wall Street is ignoring...

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Before the Cloudera IPO Date, Invest in Intel

On page two of Cloudera's IPO filing, it says the software company has a strategic partnership with Intel Corp. (Nasdaq: INTC).

Through the partnership, Cloudera optimizes its software for use with Intel processors and architecture. That's notable, but not what will make you money.

We're focusing on the fact that Intel owns a 22% stake in Cloudera. And while Wall Street finds that boring, we see a profit opportunity.

If Cloudera is valued at $4.1 billion, Intel's shares are currently worth $902 million. If that valuation were to climb $500 million more, Intel's stake would be worth over $1 billion.

"This is a stock you can count on for income and appreciation for years to come," Money Morning Director of Tech & Venture Capital Research Michael A. Robinson said on March 25, 2016.

According to FactSet, 59% of the analysts covering INTC stock have a "Buy" rating. In fact, one firm has a one-year price target of $45 for Intel stock.

From today's opening price of $36.43, that's a potential profit of 23%.

The Bottom Line: Like most IPOs, the Cloudera stock price could be extremely volatile. That's why on the Cloudera IPO date, a safer strategy that could net even higher returns than investing directly in Cloudera is to buy shares of Intel.

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