360 surged 16.8% on Monday after the San Francisco-based tracking app reported 4.9 million new users for the first quarter, taking its total above 66 million users worldwide. While only 96,000 of the new users are paying, it is easy to comprehend how analysts are extrapolating exciting future earnings for this growing tech company. Whether it is parents keen to track children or people/businesses looking to know the location of cars, boats, etc, demand is clearly strong. Revenue is increasing accordingly, with prices having been increased to $US4.99 for the top offering while non-payers indirectly deliver revenue through ads.
- We liked 360’s solid update from what is now the 15th most-used AP in the US. Further growth feels almost guaranteed, but ongoing strong performance is required to justify current levels.
- Like many tech names, Life360 is not cheap, and from a risk/reward perspective, we would prefer 360 around $12 if and when the sector experiences a pullback.
MM remains bullish toward Life360 with an optimum entry around the $12 area
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