Nearmap (ASX:NEA) share price on watch after upgrading guidance

The Nearmap Ltd (ASX:NEA) share price will be one to watch on Wednesday after upgrading its FY 2021 guidance after the market close…

| More on:
Rising asx share price represented by woman with excited expression holding laptop

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Nearmap Ltd (ASX: NEA) share price will be one to watch closely on Wednesday morning.

This follows the release of a positive announcement by the aerial imagery technology and location data company after the market close today.

What did Nearmap announce?

This afternoon Nearmap revealed that its strong performance in the first half has continued into the second half of FY 2021. As a result, the company is increasing its full year guidance for annual contract value (ACV).

According to the release, the company now expects to deliver ACV of $128 million to $132 million in FY 2021. This compares to its previous guidance of $120 million to $128 million. It will also be a 20% to 24% increase on FY 2020's ACV of $106.4 million.

Management advised that it has seen momentum continue with growth across its core industry verticals from both new and existing customers.

It believes this further reinforces the attractiveness of the company's subscription business model, the benefits of its technology leadership position, and the differentiated customer offering which combine to give Nearmap a significant competitive advantage.

In addition, the company revealed that it continues to invest the proceeds from the FY 2021 capital raise into key growth initiatives. This includes the development of HyperCamera3, which remains on track to be rolled out in FY 2022.

Positively, with each of the investment initiatives on track and with continued momentum in ACV growth, management now expects its net cash outflow to be less than $10 million this financial year.

On track to deliver growth targets

Nearmap's Chief Executive Officer and Managing Director, Dr Rob Newman, was pleased with the company's performance. He also believes Nearmap will deliver on its growth targets.

Dr Newman said: "With our refined go-to-market strategy still at a relatively early stage, I am very encouraged by the strong growth we are seeing across our ACV portfolio."

"This performance validates our strategy to focus on our core growth verticals of insurance, government and roofing, with the adoption of premium content types particularly strong from these verticals, driving returns from the investments we made into new and expanded content."

"The early success of our refined go-to-market strategy – which has delivered strong growth in FY21 – and the continued deployment of investments into this strategy gives us confidence that we remain on track to deliver on our 20- 40% ACV growth targets from FY22 onwards."

Nearmap share price performance

The Nearmap share price is down 9% since the start of the year.

Shareholders will no doubt be hoping this update gets it heading in the right direction again.

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 Nearmap Ltd. The Motley Fool Australia has recommended Nearmap Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Three happy office workers cheer as they read about good financial news on a laptop.
Broker Notes

Leading brokers name 3 ASX shares to buy today

Here's why brokers believe that now could be the time to snap up these shares.

Read more »

An excited man stretches his arms out above his head as he reaches a mountain peak representing two ASX 200 shares reaching multi-year high prices today
52-Week Highs

These ASX 200 shares just hit new 52-week highs

These stocks are defying the broader market this session.

Read more »

Man trying to balance and walk on a rope attached to a cliff's edge.
Share Market News

Australian companies that thrive in economic downturns

The strength of a balance sheet is imperative during downturns.

Read more »

A businesswoman gets angry, shaking her fist at her computer.
Share Market News

This $5.6 billion ASX 200 stock just hit a 13-year low following its earnings update

This blue chip is sinking to new lows on Monday. What's going on?

Read more »

Overjoyed man celebrating success with yes gesture after getting some good news on mobile.
Share Gainers

Why A2 Milk, Audinate, BlueScope, and Chalice Mining shares are rocketing today

These shares are starting the week with an almighty bang. But why?

Read more »

a man weraing a suit sits nervously at his laptop computer biting into his clenched hand with nerves, and perhaps fear.
Share Market News

Why AMP, Bendigo Bank, Pantoro, and Westpac shares are sinking today

These shares are starting the week in the red. But why?

Read more »

A hand moves a building block from green arrow to red, indicating negative interest rates
Share Market News

Will ASX 200 investors get the RBA interest rate cut they're expecting tomorrow?

The RBA announces its next interest rate decision tomorrow. So, what should we expect?

Read more »

two men in hard hats and high visibility jackets look together at a laptop screen that one of the men in holding at a mine site.
Share Gainers

Guess which ASX 300 stock is surging 12% on a US government deal

The ASX 300 stock looks to be benefiting from the Donald Trump presidency.

Read more »