The Mach7 Technologies Ltd (ASX: M7T) share price is up 7% to $0.69 in Tuesday trade following this morning’s announcement that the company has signed a software and services agreement with Advocate Aurora Health, an integrated healthcare network headquartered in Milwaukee, Wisconsin. The share price hit a 52-week high of $0.74 in early morning trade before retreating.
The terms of the agreement
The agreement between the 2 parties has a minimum total contract value of $5.7 million over a 5-year term. Mach7 will also add $550,000 per annum to its annual recurring revenue, bringing the total annual recurring revenue under contract to $8.4 million per annum.
The terms of the agreement stipulate that Advocate Aurora Health will use Mach7’s Enterprise Imaging Platform to store and manage images across its network of healthcare locations. Moreover, the company has also purchased the migration engine to migrate around 3.5 petabytes of data.
Advocate Aurora Health is one of the 10 largest not-for-profit integrated health systems in the United States (US). The organisation encompasses 28 hospitals, 500 outpatient locations and 68 Walgreen’s clinics across the Midwest states of Wisconsin and Illinois.
The agreement announced this morning is one of Mach7’s largest to date in the lucrative US market. Furthermore, Advocate Aurora Health is now one of the company’s largest customers in the US.
Mach7 has been one of the best performing small-cap technology companies on the ASX in 2019, with its share price rising 229%. Other small-cap technology companies that have rewarded shareholders in 2019 include Audinate Group Ltd (ASX: AD8), Bigtincan Holdings Ltd (ASX: BTH) and Megaport Ltd (ASX: MP1).
As Mach7 continues to win new business, it remains a stock small-cap investors should at the very least be monitoring on their watch lists. Focus will now turn towards its quarterly business update, which is expected to be released before the end of July.
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Tim Katavic has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of MEGAPORT FPO. The Motley Fool Australia owns shares of and has recommended AUDINATEGL FPO and BIGTINCAN FPO. The Motley Fool Australia has recommended MEGAPORT FPO. 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.