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Is Nearmap Ltd a Potential Growth stock?

Jordan Baird

Jordan Baird is the head ASR Wealth Advisers client services desk and has been with the organisation since 2017. He first started investing in his early years. While he believes that investors should leave no stone unturned he has a particular interest in trading based on broad macroeconomic trends along with specific analysis of innovative up-and-coming companies.

Nearmap Ltd (ASX: NEA) is a technological company that specialises in high resolution aerial imagery, city-scale 3D datasets, and integrated geospatial tools. Nearmap has a market capitalisation of A$1.1 billion.

NEARMAP - GROWTH STOCK2.png

What has happened to the share price over the last few months?

Nearmap’s share price spiked at around A$4.20 towards the end of June 2019. However, after Nearmap released their FY19 profit results and reported a 35% reduction in net profit after tax, the share price slumped around 40% to A$2.50. Today (4 November 2019, 1.10pm) Nearmap’s share price is up around 15% and is currently trading at A$2.86.

What caused Nearmap growth in the share price today?

Nearmap released notes on their annual general meeting (AGM) today. Nearmap displayed growth charts of Australia – New Zealand and North America as shown in figure 1.

 

Figure 1

NEARMAP - GROWTH STOCK
Source: Nearmap 2019 AGM presentation

As shown in figure 1, Nearmap’s North America market remains the key growth opportunity compared with Australia and New Zealand in the coming years. Additionally, the growth in portfolio lifetime value is impressive, with future growth expected due to Nearmap’s expansion strategy into North America and potentially Europe and Asia.

What is the outlook for Nearmap?

The outlook for Nearmap is positive, as it could become the global leader within the market of location intelligence. Nearmap’s management notes

With our unique technology and business model which no other aerial imagery company has been able to replicate at scale, Nearmap continues to focus on the global opportunity to become the world’s leading provider of subscription-based location intelligence.

 


 

Disclaimer:

This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)

(“ASR”). ASR is part of Amalgamated Australian Investment Group Limited (AAIG) (ABN: 81 140 208 288 Level 13, 130 Pitt Street, Sydney NSW 2000).

This article is provided for informational purpose only and does not purport to contain all matters relevant to any particular investment or financial instrument. Any market commentary in this communication is not intended to constitute “research” as defined by applicable regulations. Whilst information published on or accessed via this website is believed to be reliable, as far as permitted by law, we make no representations as to its ongoing availability, accuracy or completeness. Any quotes or prices used herein are current at the time of preparation. This document and its contents are proprietary information and products of our firm and may not be reproduced or otherwise disseminated in whole or in part without our written consent unless required to by judicial or administrative proceeding. The ultimate decision to proceed with any transaction rests solely with you. We are not acting as your advisor in relation to any information contained herein. Any projections are estimates only and may not be realised in the future.

ASR has no position in any of the stocks mentioned.

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