Self managed superannuation fund (SMSF) and wealth management technology business, Class Ltd (ASX: CL1), looks to be setting itself up for another stellar year.
In an announcement to the ASX this morning, the $325 million software company released its shareholder update detailing growth across its two products, Class Super and Class Portfolio.
Class Super is a cloud-based software platform used by SMSF administrators, such as accountants, to efficiently manage client portfolios. Class Portfolio is an application for accountants, administrators and advisors to manage all types of investments in one place.
For the quarter ended 31 December 2016, Class added a record 5,745 new portfolios to its platforms, with total billable portfolios now at 130,216. Class Portfolio experienced a 22% increase with 433 new portfolios added.
Given the growth, Class's SMSF market share now stands at an estimated 21.7%.
"Class enables administrators to win new business much faster than industry growth rates," the company's update read. "Continued industry growth and transfers from other providers and obsolete systems, combined with strong underlying organic growth in the current subscriber base, should continue to propel Class' growth for some time."
Class estimates the total value of assets on Class Super currently stands at $161 billion with the average balance being $1.26 million, or $664,000 per SMSF member.
A stellar 2017 for Class?
Despite a 25% fall in the Class share price over the past three months, I believe Class has a long runway for growth. The efficiencies gained from using cloud-based accounting software is significant and the benefits of continued use are evident from the new business Class's administrators are generating. For those reasons, I believe Class is a tech stock to watch in 2017 and beyond.
