The Big Un Ltd (ASX: BIG) share price has continued its impressive run with another strong gain today.
In morning trade the video technology company's shares are up 10% to a new record high of $2.87.
This latest gain means that Big Un's shares have now rallied over 1,150% since the start of the year.
Why are its shares higher today?
This morning Big Un released its first-quarter update which arguably went some way to justifying the meteoric rise in its share price this year.
According to the release, for the quarter ended 30 September 2017, Big Un achieved cash receipts from customers of $15 million. This was an increase of 488% on the prior corresponding period.
Furthermore, the company reported a cash profit of $5.6 million from operating activities for the quarter. An extra $0.8 million was received from the exercise of share options, resulting in a net increase in cash of $6.3 million.
This ultimately left the company with a closing cash balance of $15.5 million.
As well as gaining a boost from its continued expansion in the United States, one-fifth of the cash receipts generated during the quarter came from existing clients.
In fact, revenue from existing customers increased 22% from the corresponding quarter in the prior year. Not only have these existing customers renewed their business, they are paying considerably more than they were a year earlier.
This is likely to be the result of the company offering larger bundled video products. This played a key role in the company reporting an 154% increase in average revenue per user on the prior corresponding period to $7,500.
Should you invest?
While its shares have clearly run hard this year, I feel it is more than justified. If the company can deliver the same quarterly cash profit throughout the whole year, it will end up with a cash profit of $22.4 million.
With a market cap of approximately $400 million, this means its shares are changing hands at about 18x forward cash profit.
I don't believe that is too demanding for a company exhibiting such strong growth and with significant expansion opportunities in the future.
In light of this, I continue to believe Big Un is one of the most exciting tech shares on the Australian share market today alongside Altium Limited (ASX: ALU) and Aconex Ltd (ASX: ACX).
