One of the best performers on the Australian share market this year has been the Updater Inc (ASX: UPD) share price.
Year-to-date the technology company's shares are up almost 200%.
Despite this strong gain and its hefty market capitalisation, I still believe it is a great long-term buy and hold investment option. Here are three reasons why:
Quality product offering.
Updater aims to make the moving process easier for the estimated 17 million households that relocate each year in the United States.
To do this it provides a software platform which allows its users to seamlessly transfer utilities, update accounts and records, and forward mail.
Due to the growing popularity of the software, Updater now has over 800 industry-leading real estate partners using it. These include over half of the top 50 property managers and the three largest.
In my opinion, a testament to the quality of the product is that Updater is adding 30 new partners on average every quarter with next to no churn.
Market penetration.
Thanks to the growing number of real estate partners on its books, Updater's estimated market penetration of quarterly moves processed in the United States is growing at an incredibly strong rate.
Source: Company presentation.
As you can see above, the company processed an estimated 15.7% of moves in July. This was a significant increase on the second-quarter and was achieved well ahead of schedule.
As a result, the company has brought forward its business plan and will begin to leverage its position by selling insurance products by the end of the year.
Revenue generating opportunities.
Whilst Updater is generating little by way of revenue at the moment, once the company has penetrated the market significantly (35%) I believe it will be in a powerful position to generate lucrative revenue streams by selling products and connecting businesses with movers.
After all, according to management, US businesses spend billions of dollars trying to reach movers each year. If this can be done cost-effectively through its platform, I expect Updater could be in a great position to profit.
Foolish takeaway
Overall, I think Updater is one of the most promising tech companies on the Australian share market at the moment.
While it does have an awful lot of future growth built into its share price, I remain confident that the company has positioned itself to deliver on expectations in the long-term.
In light of this, I would put it up there alongside the likes of Altium Limited (ASX: ALU) and GetSwift Ltd (ASX: GSW) as a great long-term buy and hold investment option in the tech space.
