The Jumbo Interactive share price is up over 300% in 12 months

The Jumbo Interactive Ltd (ASX:JIN) share price has now rocketed 300% in just 12 months. Here's why…

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The Jumbo Interactive Ltd (ASX: JIN) share price has continued its incredible run and is up another 8% to a record high of $27.10 on Monday.

This latest gain means the lottery ticket seller's shares have now gained a massive 310% since this time last year.

Why has the Jumbo share price quadrupled in value over the last 12 months?

Investors have been fighting to get hold of Jumbo's shares thanks largely to its impressive performance in FY 2019.

During the 12 months ended June 30, Jumbo delivered a 75% increase in total transaction value to $321 million, a 64% jump in revenue to $65 million, and a whopping 124% lift in net profit after tax to $26.4 million.

This strong result was driven by the winning combination of strong growth in active accounts, large jackpots, average spend, and lower costs per lead.

Over the 12 months Jumbo reported a 74% lift in active customers to 761,863, a 53% increase in large jackpots to 49, a 3.85% rise in average 12-month spend per active customer to $385.44, and a 20% reduction in its costs per lead to $13.81.

Another catalyst for this share price rise was a positive announcement released late last week by S&P Dow Jones Indices.

According to the release, it will add Jumbo to the coveted S&P/ASX 200 index at the next quarterly rebalance later this month.

When a company is added to an index it can lead to an increase in demand for its shares from exchange traded funds that are designed to track an index and from fund managers that may have investment mandates which permit them to only buy shares on certain indices.

Should you invest?

I'm a big fan of Jumbo and believe it has significant growth potential, especially given the scalability of its software and its global market opportunity.

However, its shares do look fully valued now, so I intend to hold back for a better entry point further down the line.

Jumbo isn't the only share hitting a record high today. Also making this milestone have been the shares of Afterpay Touch Group Ltd (ASX: APT) and Xero Limited (ASX: XRO).

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Jumbo Interactive Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and Xero. The Motley Fool Australia has recommended Jumbo Interactive Limited. 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.

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