ASX technology stocks have largely performed well for investors over the last 12 months.
The S&P/ASX All Technology Index (ASX:XTX) is up more than 20% in that span.
For context, the S&P/ASX 200 Index (ASX: XJO) is up 7% in that same period.
One technology stock that has drawn attention from brokers is Eroad Ltd (ASX: ERD).
Image source: Getty Images
A blistering year
Many investors might not have heard about this small-cap share.
Eroad is a New Zealand-based company that develops and supplies technology solutions, products, and services to assist in the management of vehicle fleets.
The company offers integrated technology covering tolling and other payments, vehicle tracking, emissions management, and driver safety data and feedback.
12 months ago shares in this ASX technology stock were trading for $1.06 each.
Yesterday, they closed at $2.26 per share, representing a 113.21% rise in the last year.
Regulatory tailwinds inbound
One catalyst that has driven the recent share price climb is the recent news of the New Zealand Government's plan to transition all New Zealand vehicles to electronic Road User Charging (eRUC).
This kind of regulatory tailwind gives the company a strong addressable market and can significantly boost expectations of future revenue and cash flows.
Arthur Garipoli, Seneca Financial Solutions, believes this is reason for optimism on the ASX technology stock.
Of major significance to the company is the New Zealand Government planning to transition all vehicles to an electronic road user charging system (eRUC), replacing the fuel excise currently charged on petrol.
This combats an increasing uptake in electric and hybrid vehicles and ensures all road users contribute to the cost of maintaining and improving New Zealand's transport network.
He also said the company has a dominant market share of eRUC in New Zealand and has first mover advantage.
He said the team at Seneca believes regulatory tailwinds will generate continuing growth for this stock.
Price targets elsewhere suggest it has room for growth.
TradingView has a 12 month price target of $2.70 which indicates approximately 19% upside.
Online brokerage platform Selfwealth also lists it as undervalued by approximately 19%.
