Life360 Inc (ASX: 360) shares were in fine form yet again on Tuesday.
The location technology company's shares ended the day 8% higher at $40.77.
This means they are now up 135% over the past 12 months.
Can Life360 shares keep rising?
The good news is that it may not be too late to invest in this market darling according to analysts at Bell Potter.
Especially after it delivered a second quarter result ahead of expectations. It said:
2Q2025 revenue of US$115.4m was 6% ahead of our forecast of US$109.1m and adjusted EBITDA of US$20.3m was 59% above our forecast of US$12.8m. The key metrics of global MAUs, total paying circles, ARPPC and AMR were all close to in line with our forecasts. Operating cash flow of US$13.3m was up 303% on pcp but was below adjusted EBITDA due to the timing of receipts and payables.
Cash at 30 June was US$433m and was boosted by the issue of US$320m in convertible notes during the period. The company also announced the transition of CEO and co-founder Chris Hulls to Executive Chair and the promotion of COO Lauren Antonoff to CEO.
Bell Potter was also pleased to see the company upgrade its guidance for FY 2025. It adds:
Life360 upgraded its 2025 revenue and adjusted EBITDA guidance from US$450- 480m to US$462-482m (a 3% uplift at the low end) and from US$65-75m to US$72- 82m (11% uplift at the low end, 9% at the top). The implied adjusted EBITDA margin is now 15.3-17.4% versus 14.0-16.1% previously using the mid-point of the revenue guidance ranges.
Time to buy
According to the note, in response to the update, the broker has retained its buy rating with an improved price target of $47.50 (from $37.50).
Based on its current share price of $40.77, this implies potential upside of almost 17% for investors over the next 12 months.
Commenting on its buy recommendation, the broker said:
We have increased the multiples we apply in the EV/Revenue and EV/EBITDA valuations from 9.5x and 55x to 12.5x and 62.5x and also reduced the WACC we apply in the DCF from 8.5% to 8.3% due to the strong result and better-than-expected operating leverage. The net result is a 27% increase in our PT to $47.50 which is >15% premium to the share price so we maintain the BUY recommendation. Potential catalysts include a strong 3Q2025 result and potential further upgrade in the guidance.
