The Altium Limited (ASX: ALU) share price is on fire right now. Shares in the Aussie tech stock have surged 19.7% higher since the end of August to $35.79 per share at Thursday’s close.
In early trade on Friday, the Altium share price is rising strongly, up by 5.72% to $36.98 at the time of writing.
So, what’s sparking the recent recovery for the WAAAX share?
Why the Altium share price is up 20% in September
Altium was a little bit late to the party on the August reporting season. The company released its full-year results on August 30 with some of the key takeaways below:
- Total revenue up 1% on the prior corresponding period (pcp) to US$191 million
- Recurring revenue share of total revenue up by 6% on pcp to 65%
- Profit before tax down 7% on pcp to US$48 million
- Earnings before interest, tax, depreciation, and amortisation (EBITDA) down 3% on pcp to US$60 million
- Net profit after tax up 80% on pcp to US$35 million
At first glance, it appears to have been a bit of a mixed bag for Altium. The company’s shares slumped following the earnings release but have been climbing strongly in September.
The Altium share price is underperforming the S&P/ASX 200 Index (ASX: XJO) in 2021. It is up 6.8% year to date compared to the index at 10.6%.
Broker says ‘buy’
One factor at play for the recent gains has been positive broker notes. Citi recently upgraded the company’s shares to a ‘buy’ rating in a recent note with a $35.40 price target. That helped boost the Altium share price higher in early September as investors reacted to the news.
While Altium is lagging the index in 2021, it’s not all bad news for buy and hold investors. Shares in the electronic design software provider are up 294% in the past 5 years, excluding dividends.