Nearmap’s Share Price Skyrockets by 129% since January

Why Australia’s best performing stock is up 129%.

Shares in Australian geospatial map technology firm Nearmap Ltd [ASX:NEA] have skyrocketed since the beginning of the year, making it the best performing stock on the benchmark ASX 200. The cloud-based company has seen its share price jump by more than 129% since January and is up 292% for the last 12 months.

At the time of writing Nearmap’s share price is currently trading at $3.53.

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Years of investment are paying off for Nearmap

Nearmap sell subscription access to high-resolution aerial images that cover most of Australia’s and the US’ city and regional centres that assist with assessing progress of a building project or emergency response plans for a particular area.

NEA draws its competitive advantage from its propriety software that can piece images together to create detailed photomaps. The company says it sustains its advantage because its cameras can take images at greater altitudes and speeds than its competitors without sacrificing resolution.

Though some might count Google Maps as one of NEA’s largest competitors, Mason Willoughby-Thomas, a portfolio manager at Ausbil Investment Management, says the internet giant’s geospatial imagery relies on lower-resolution images and infrequent capture rates, making it inadequate for commercial use — a market NEA specifically targets.

According to the Geospatial Industry Outlook & Readiness Index, the global aerial imagery market is estimated at US$7.4 billion (2018) and is expected to reach US$10.1 billion by next year. NEA estimates it can address some AU$250–300 million in the Australian market and US$1–2 billion in the US.

Continued expansion for Nearmap

Nearmap says it will continue to expand into the North American market. The company announced in February that it plans to focus on further US growth, entry into Canada and the creation of more products. The announcement came on the back of a $70 million capital raise, which the company says will allow them to accelerate and support delivery of its key strategic objectives.

Source: Tradingview.com

With expansion underway, NEA estimates the Canadian market could be worth CA$300–400 million, with many US customers seeking insights from their northern neighbours.

In April, the share price march upwards was reinforced by the announcement the Myob Group Ltd [ASX:MYO] would be replaced by Nearmap on the ASX 200 benchmark.

Regards,

Ryan Clarkson-Ledward,
For Money Morning

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