It was a mighty day for the WiseTech Global Ltd (ASX: WTC) share price today. Shares in the cloud-based logistics software company finished Thursday's session as the third best performing share in the S&P/ASX 200 Index (ASX: XJO).
At the end of the day, the Wisetech share price climbed 7.17% to $53.51, putting it 6.6% away from its 52-week high. As a result, the company holds a market capitalisation of $17.39 billion.
Interestingly, the upwards move in value today comes without any announcement from WiseTech. In which case, let's take a look at what else might have helped.
Rising tide lifts all boats
Rather than company-specific news helping the WiseTech share price today, the move appears more widespread.
For instance, the S&P/ASX All Technology Index (ASX: XTX) gained 3.11%, which would be partially thanks to WiseTech. However, other notable contributions came from Megaport Ltd (ASX: MP1), Xero Limited (ASX: XRO), and Afterpay Ltd (ASX: APT). This trend on Aussie markets followed the lead of US markets overnight, where the tech-heavy Nasdaq Composite index gained 0.7%.
Additionally, the push higher in tech shares comes as some market commentators warn of an impending period of stagflation. As the saying goes, a rising tide lifts all boats, and rising tech shares have carried the WiseTech share price with it today.
In simple terms, stagflation involves a mix of high inflation and slowing economic growth. During such periods investors tend to flee to 'high performing' shares — which might include some of the more profitable, high margin tech businesses.
As demonstrated in its FY21 result, WiseTech might meet that criteria to some investors. For reference, the company delivered a net profit after tax of $105.8 million, doubling its earnings from FY20.
At the same time, with supply chains being in such turmoil, software that optimises this industry might have the ability to retain customers with price increases to negate inflation.
WiseTech share price in review
The WiseTech Global share price has delivered sensational returns to shareholders compared to the benchmark index. For example, the logistics software company has experienced a 95.7% rise in its share price in the past year. Meanwhile, the S&P/ASX 200 Index has climbed 17.7%.
At present, Wisetech trades on a price-to-earnings (P/E) ratio of 112 times.
