Lately, I’ve been reading mixed reviews of Swedish plant-based milk company Oatly (NASDAQ:OTLY). Even after a blockbuster initial public offering (IPO), the sentiment surrounding OTLY stock is starting to cool off.

As the share price drifts down from the peak, folks who’ve been sitting on the sidelines can consider taking a position. After all, it’s not typically a great idea to buy during a hype phase.

Price is important, and we’ll certainly address the brief price history of OTLY stock. Yet, investors must also consider whether they’re really prepared to wager their capital on dairy-alternative products made from oats.

Well, apparently oats aren’t just for horses. There’s an actual trend here, and it’s more lucrative than you might expect.

A Closer Look at OTLY Stock

Let’s go back to the beginning, which really wasn’t that long ago.

Oatly priced its IPO at $17 per share on May 19. That’s at the top of the previously indicated range of $15 to $17 per share.

Apparently, Oatly was backed by celebrities such as Oprah Winfrey and Jay-Z. So, the anticipation was undoubtedly building in the lead-up to the IPO.

Two days later, on May 21, OTLY stock began trading on the Nasdaq Exchange. You can probably guess what happened next.

The share price immediately soared, opening at $22.12. That’s 30.1% higher than the IPO price of $17.

Within minutes, OTLY stock retreated to around $21.30, demonstrating how price chasers can get punished quickly and brutally.

Still, the IPO was a success overall. The share price continued to move upwards over the ensuing days, topping out at $29 in mid-June.

In the back half of June, however, OTLY stock started to back away from its peak price. Currently, the stock is trading at more than $23.

I wouldn’t call that a massive discount, but it might not be a terrible entry point for new investors. Waiting for much lower prices could cost you the opportunity to grow your account along with the company and the broader industry.

Solid Growth

I must admit, I assumed that Oatly’s target audience would be millennials and Gen Z, who are open-minded to plant-based food options.

As usual, making assumptions turned out to be a bad idea. I dug deeper and make a surprising discovery (or two, or three) about the oat milk market.

First off, according to a report by IMARC Group, the global oat milk market is expected to grow at a compound annual growth rate of around 8% from 2021 to 2026.

OK, so that’s not mind-blowing growth like you might get with electric vehicle batteries or cannabis. Nonetheless, it’s solid, consistent industry growth and that should appeal to risk-averse investors.

But here’s where it really gets interesting. IMARC Group emphasized that oak milk is vegan-friendly and offers a rich source of minerals. And there’s another angle that I hadn’t previously considered.

Hold the Lactose

Namely, it’s ideal for lactose-intolerant folks. Oatly is addressing a market of millions as not everyone can safely consume animal-derived milk products.

The analysts even went so far as to assert that the global oat milk market “is primarily driven by the increasing incidences of lactose intolerance among the masses.”

And by the way, we’re not only talking about milk for your cereal here.

As I learned from InvestorPlace contributor Nick Clarkson, Oatly’s product lineup ranges “from basic oat milk to ice cream, yogurt and soft serve made from oat milk.”

Heck, I might even be tempted to try Oatly’s alternative yogurt, or “oatgurt.” I’m not lactose-intolerant, but I try to be open to new adventures in both food and investing.

The Bottom Line

So, I learned a few things about the oat milk industry while researching Oatly. And, I quashed one of my many incorrect assumptions.

Ultimately, OTLY stock isn’t as risky as I had suspected at first.

The company serves a huge addressable market, and the share price looks pretty enticing now that the hype phase has passed.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.