Shares of BidEnergy Limited [ASX:BID] jumped to a year high this morning after the release of their half-yearly operational report.
At time of writing, BidEnergy’s share price is $1.08 a piece (up 20%).
The company offers ‘energy spend management’ software solutions to a range of businesses across Australia, New Zealand, the US and the UK.
A spike in share price after a big announcement such as a company’s half-year results, naturally makes a stock more sensitive to shifts.
Ideally shareholders want a stock with the best chance of rising gradually over time…
That’s why Money Morning contributor, Sam Volkering shares four Aussie stocks he thinks could be performing well this year and beyond. You can read more about his stock picks here (for free).
What led to Bid Energy’s share price surge?
BidEnergy has recorded significant growth with $2.8 million in revenue gained for the period ending 31 December 2018, a 24% improvement on the previous period. Much of the result was based on higher subscription-based fees (up 55%) and US rebate revenue (up 7%).
The company also added new major client subscriptions to their overall portfolio — particularly in the US and UK — which appears to have spurred confidence in the promise of further client opportunities.
Because of such a rapid growth experience, BidEnergy has seen a 60% increase in customer growth and a 43% improvement in cash outflows.
Commenting on the notably improved results, Director Guy Milne went on to say:
‘These half year results illustrate a strong improvement in top line revenue resulting from our significantly improved sales and marketing focus. Strong fiscal management has seen the company improve its underlying EBITDA and cash flow.’
What does this mean for BidEnergy?
On the surface, it seems as though such good results have come at a time when the board has been undergoing rapid change.
Those newly in charge of the company (including non-executive Chairman Andrew Dyer) didn’t have much to say about the change, instead concentrating on the expansions in the American market, as well as the growth in the core Australian market.
‘The Company is now pursuing a plan of substantive expansion, supported by the changes to the Board implemented this week, which reflect the need for a seasoned, experienced board that can govern a dynamic and growing business over the long term,’ said Dyer.
Dyer is optimistic that BidEnergy is going into FY19 with a strong cash balance and high room for growth, which should keep investors going — at least in the short-term.
For Money Morning
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