MENU

WiseTech Global Ltd (ASX:WTC) share price sinks lower: Should you invest after its AGM update?

The WiseTech Global Ltd (ASX: WTC) share price has tumbled lower on the day of its annual general meeting.

At the time of writing the shares of the provider of software to the logistics services industry are down 4.5%.

Why are WiseTech Global’s shares sinking lower?

I suspect that this decline is largely unrelated to events at its meeting and more to do with a broad tech selloff.

Overnight the Nasdaq slumped 1.7% with declines being seen across most major U.S. tech stocks. Apple was one of the worst performers on the index with a decline of almost 5%.

What happened at the annual general meeting?

As the fast-growing company provided an update just a few weeks ago at its investor day, there were no real surprises at today’s meeting.

Chairman Andrew Harrison and founder CEO Richard White spoke positively about WiseTech Global’s performance in FY 2018 and its prospects in the future.

Mr Harrison pointed out that FY 2018’s 44% jump in revenue to $221.6 million meant it had grown its top line by a CAGR of 41% over the past five years.

This was achieved through “high recurring high quality” revenue and its low customer attrition. The company’s CargoWise One platform generated 99% recurring revenue and boasted a <1% annual customer attrition rate in FY 2018.

Looking ahead, management appears confident that its strong performance can continue in FY 2019. It reiterated its recently upgraded guidance for revenue in the range of $320 million and $333 million. This represents growth of 44% to 50% on the prior corresponding period.

The company’s EBITDA is also expected to grow strongly. Management has forecast EBITDA of $102 million to $107 million, representing year on year growth of 31% to 37%.

Should you invest?

I think that WiseTech Global is one of the best tech shares on the Australian share market along with Altium Limited (ASX: ALU) and Appen Ltd (ASX: APX).

But with its shares changing hands at approximately 77x estimated FY 2019 earnings, I’m going to hold out in hope of a better entry point further down the line.

Looking for the next WiseTech? Then check out these up and coming tech shares which have enormous promise.

The Disruptors: 3 Revolutionary Aussie Companies to Back for 2018

We’re living in one of the most exciting times in investing history. Innovation and a booming culture of entrepreneurship are constantly creating new companies with the potential to make forward-thinking investors very rich. Now more than ever, one small, smart investment could make a huge difference to your wealth.

That’s why at The Motley Fool we’ve been scrutinizing the ASX to uncover the kinds of companies that we believe could turn into the next Atlassian.

We’ve found three exciting companies that we believe re poised to perform in the new year. Click here to uncover these ideas!

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Altium, Appen Ltd, and WiseTech Global. 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 Scott Phillips.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…

Including:

The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!