Here's why the 1-Page Ltd share price soared 27% today

The 1-Page Ltd (ASX:1PG) share price rose as much as 26.8% this afternoon.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Shares of 1-Page Ltd (ASX: 1PG) have surged more than 22% today, and they did climb as much as 26.8% to a high of $2.46 earlier.

Indeed, the company released an update for its fourth-quarter performance today. It was an encouraging update from the group, which said it had $4.2 million in new bookings at the end of January – a 200% increase from $1.4 million at the end of November 2015.

It also said it had increased its number of annual enterprise contracts by 200% compared to the previous quarter to 24, five of which were valued at more than $300,000 each. Two of those five contracts are said to be worth more than $500,000 annually.

Some of the names it added to its customer list included two Fortune 100 technology giants, as well as Deutsche Bank, McGraw Hill Financial and Under Armour, to name just a few.

But notably, it said: "Both revenue and cash receipts lag new bookings between 3-6 months due to the deployment period of the 1-Page platform and clients cash collection period, per their policies and needs." The revenues from these bookings and contracts will be recognised in coming months, with cash expected to be received between 60 and 90 days following that.

It received $75,000 in cash receipts from customers during the latest quarter, and $394,000 for the year, while operating cash flows were negative $3.9 million. Much of this is being spent on research and development which is important for the company's growth, while it also had $48.9 million cash in the bank at the end of the period thanks to a $50 million capital raising in November.

What does this mean?

1-Page is a Silicon Valley-based business that provides cloud-based human resources from a software-as-a-service (SaaS) platform. It claims that its products can save both time and costs in the hiring process whilst also improving staff retention rates.

The fact that it has "at least one" of each of the top five global players in verticals including technology, retail, insurance, financial and consumer goods shows how versatile its product is across industries.

Enterprise customers are by far the most important customers for 1-Page to obtain as the clients pay based on how many employees they have. It also noted that its typical enterprise contract has, on average, 1,700 jobs open at any one time, highlighting the opportunity for 1-Page to grow and for its products to be utilised.

Although it is a relatively new business with limited trading history, there is certainly the potential for it to become a much bigger player in the global HR industry, potentially going on to rival the likes of LinkedIn and SEEK Limited (ASX: SEK).

It's also worth noting that the shares aren't cheap right now, while they are also still highly speculative in nature. I own a parcel of shares in the business but would be hesitant to become too exposed based on that fact.

Still, the shares have fallen sharply since peaking in September 2015 and could be worth a look by investors willing to accept a greater risk for a potentially large reward.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of LinkedIn and Under Armour. Motley Fool contributor Ryan Newman owns shares of 1-Page Ltd and LinkedIn. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. You can follow Ryan on Twitter @ASXvalueinvest. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »