It has been a stunning 12 months for the Catapult Group International Ltd (ASX: CAT) share price.
Since this time last year, the ASX tech stock has risen a remarkable 180%.
To put that into context, an investment of $5,000 a year ago would now be worth $14,000 today.
But what's next for the shares of the global provider of elite athlete wearing tracking solutions and analytics? Let's find out.
Can this ASX tech stock keep rising?
The good news for investors is that it isn't too late to jump on the Catapult train according to analysts at Bell Potter.
This morning, the broker has reiterated its buy rating and lifted its price target by 21% to $4.00 (from $3.30).
Based on its current share price of $3.54, this implies potential upside of 13% over the next 12 months.
What is the broker saying?
Having only recently updated its estimates for the ASX tech stock, there are no changes to the broker's forecasts with this note. However, it does see potential for Catapult to outperform expectations in the second half. It said:
There is no change in our forecasts which we only updated recently at the release of the 1HFY25 result earlier this month. We continue to forecast FY25 revenue and statutory EBITDA of US$115.9m and US$16.8m which implies a similar 2HFY25 result to 1HFY25.
We do, however, see some modest upside risk to our forecast given Catapult tends to have a slightly stronger 2H result and, for instance, the 1H/2H revenue split the past two years has been 49.8%/50.2% in FY24 and 49.3%/50.7% in FY23. We also see some modest upside risk to our FY25 ACV forecast of US$103.2m which equates to growth of 19% after the company reported growth of 22% in 1HFY25 though the growth has been lower in 2H versus 1H in two out of the last three years.
Valuation increase
As I mentioned above, Bell Potter has lifted its valuation of the ASX tech stock by 21%. This is despite no changes to its earnings estimates.
The broker explains that this change has been driven by a re-rating of comparable peers to higher multiples. It feels that Catapult is deserving of a re-rating itself given its strong performance and positive growth outlook. It said:
We have increased the multiple we apply in our EV/Revenue valuation from 4.75x to 5.5x given the continued rally in the tech sector and the increase in multiples of comps like Life360 (c.8x in 2025), Siteminder (c.8x in FY25), Gentrack (c.6x in FY25) and Dropsuite (c.5x in FY25).
We believe the stock looks reasonable value on EV/Revenue multiples of 5.5x in FY25 and c.5x in FY26 relative to comps like Life360, Siteminder and Gentrack which trade on higher multiples.
