How did the Nearmap (ASX:NEA) share price respond last earnings season?

Nearmap’s shares were on fire in February after a stronger than expected update…
The post How did the Nearmap (ASX:NEA) share price respond last earnings season? appeared first on The Motley Fool Australia. –

The Nearmap Ltd (ASX: NEA) share price has been a positive performer over the last three months.

Since this time in May, the aerial imagery technology and location data company’s shares have risen 27%.

This may have been driven by hopes that a strong full year result this week could give the Nearmap share price a boost.

How did the Nearmap share price respond last earnings season?

The Nearmap share price rocketed higher following the release of its half year results in February. Investors were buying the company’s shares after it proved short sellers wrong by delivering strong growth in its North American business.

At the end of the first half, Nearmap’s total annual contract value (ACV) stood at $112.2 million on a reported basis and $116.7 million on a constant currency basis. This was up 16.1% and 21%, respectively, over the prior corresponding period.

This was driven largely by its North American business, which reported ACV growth of 21.9% since the end of June to US$35.1 million.

Also getting investors excited was its operating leverage. It boosted Nearmap’s margins and underpinned strong operating earnings growth. For example, earnings before interest, tax, depreciation and amortisation (EBITDA) increased 322% to $13.5 million.

Things weren’t quite as positive on the bottom line, with the company posting a statutory loss after tax of $9.4 million. Though, this was an improvement from an $18.6 million loss a year earlier.

Furthermore, Nearmap has the balance sheet strength to absorb this loss. It ended the period with a cash balance of $129.3 million.

What’s next for Nearmap?

Last month Nearmap provided an update and revealed that it expects to reported ACV of $133.8 million for FY 2021 in constant currency terms. This compares to its upgraded guidance of $128 million to $132 million. Once again, management advised that this was driven by its North American business. This went down well with investors, leading to another jump in the Nearmap share price.

So with its result already largely pre-released, one thing that could move the Nearmap share price this earnings season will be its guidance for FY 2022.

Nearmap has a long term ACV annual growth target of 20% to 40%. Anything towards the top end of that range would be likely to give the Nearmap share price a boost.

The post How did the Nearmap (ASX:NEA) share price respond last earnings season? appeared first on The Motley Fool Australia.

Should you invest $1,000 in Nearmap right now?

Before you consider Nearmap, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Nearmap wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

2 mid cap ASX shares that analysts love

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Nearmap Ltd. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!