Trailblazer of the year: Ellie Mae stock up 391%

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Understanding the needs of customers, trends in the market and execution of plans were key factors that drove mortgage lender Ellie Mae ($22.68 -0.01%) [3] to the highest percentage gain of any New York Stock Exchange Big Board stock in 2012, they claim.

The company was the number-one gainer, up 391%, with shares going from under $6 to more than $30 at one point. At year-end, shares were in high $20s. In 2011, Ellie Mae went public [4] and priced its initial offering between $9 and $11 per share.

Here is a Yahoo! Finance screen shot of the last year of Ellie Mae stock:

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"We performed very well as a stock — that’s obviously a function of how the market and investors perceive the value of the company, its performance and its growth,” chief operating officer Jonathan Corr of Ellie Mae told HousingWire.

A combination of the company’s fundamentals such as growing the software-to-service model, adding significant numbers of new users as well as new lenders to the system and customer’s continuation to adopt more services across the business-to-business network, known as Ellie Mae Network have led to exceeding market expectations.

"Lenders are looking to figure out how to embrace efficiency to maintain a profitable situation in dealing with all of these issues," Corr said.

He added, "Layer on top of that you beat both investor’s expectations and the market’s expectations and good things can happen and that’s what has played out over the last year."

Over the past year, Ellie Mae’s economic performance was projected to grow more than 80%, which was exceeded. User growth also skyrocketed from about 54,000 users to more than 70,000 users.

Ellie Mae says it isn’t slowing down any time soon.

In 2013, the company is expected to grow by at least 25%, assuming the market is going to be down 20%, which is from the composite of Mortgage Bankers Association, Fannie Mae and Freddie Mac loan volume origination.

"We just continue to see people embracing our enterprise footprint because of the capabilities and what it helps lenders do in terms of dealing with compliance, regulation and quality demands," Corr said. "And also the fact that our software as a service model is just very attractive in terms of the return on investment."

Ellie Mae has $100 million on the balance sheet and is spending a significant amount in research and development, about $18 million in 2012.

Going forward, Consumer Financial Protection Bureau’s finalized regulations [6] are going to impact the capabilities of the company’s products, such as going paperless [7] for ordering, signing and servicing loans.

In October, Ellie Mae introduced a new automated document created and management solution tool, called Encompass Docs Solutions [8].

"We’re a company with a lot of resources, a company with more users than any other provider and so being in a place where you can listen to what the customer’s need, also understand what’s coming from the regulatory side and what’s happening with overall trends puts us at a great place to respond," Corr said.

cmlynski@housingwire.com [9]