Nearmap shares surge 16% as ACV exceeds $102 million

We look at the highlights from Nearmap's latest media release titled 'ACV exceeds $102M, commercial launch of Nearmap AI.'

Nearmap share price rises, churn comes in lower

Despite challenging trading conditions as a result of the coronavirus pandemic – aerial imaging company Nearmap (NEA) today revealed that its annualised contract value (ACV) has continued to climb, currently sitting above $102 million, on a constant currency basis.

The response to this news was decisively bullish, with the Nearmap share price closing out Thursday's session 16.6% higher, to $2.240 per share.

Ultimately, as FY20 fast draws to a close, Nearmap noted that its full-year ACV guidance has now been narrowed to between $103 million to $107 million. Better still, Nearmap also revealed over the prior 12-month period, its churn levels have moderated and currently sit below 10%. For reference, for the12-months ending December 2019 Nearmap recorded churn levels of 11.5%.

Mind you, although churn has moderated and the company remains confident in its growth trajectory when economic conditions normalise, management did flag that 'There has been some impact on the velocity of the sales cycle as a small number of customers delay their decisions to acquire or upsell but with a strong and growing sales pipeline the fundamentals of the business remain intact.’

Elsewhere, the company also today revealed the launch date for its latest product, Nearmap AI. Speaking to the company’s zeal to remain competitive in a highly-dynamic and technologically focused market-space, it was noted that:

'Following the roll-out of 3D and roof geometry, Nearmap AI represents another significant milestone for Nearmap as it continues to enhance its market-leading technology position in order to penetrate more deeply into the larger and expanding location intelligence market.’

Nearmap AI will officially launch on 1 June, and be available as either a self-service export or through offline channels, in the US and Australia.

The benefits of cash management

Nearmap also announced that it expected to be cash flow break even by the end of fiscal 2020, as a result of cash management initiatives that the company has recently implemented. At the close of FY20, NEA expects to have a cash balance of between $32 million to $35 million.

Looking forward, Nearmap's CEO and MD Dr Rob Newman said:

'As we approach FY21 we look forward to bringing new and innovative products to our growing customer base, which will further enhance our market leadership proposition in our key markets.'

Nearmap currently has a market capitalisation of $869.21 million, according to the ASX.

Are you bullish or bearish on Nearmap?

You can use CFDs to trade Nearmap and other ASX-listed tech stocks – LONG or SHORT through IG’s world-class trading platform now. For example, to buy (long) or sell (short) Nearmap, follow these easy steps:

  1. Create an IG Trading Account or log in to your existing account
  2. Enter ‘Nearmap’ in the search bar and select it
  3. Choose your position size
  4. Click on ‘buy’ or ‘sell’ in the deal ticket
  5. Confirm the trade

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
Sell
Buy
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Sell
Buy
Updated
Change

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Sell
Buy
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
China 300
-
-
-
-

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.