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Australian Investment Blog

Uncategorized 31/01/2020

Nearmap (NEA) runs into a roadblock

Nearmap (NEA) –29.84%: for the second day in a row the ASX saw 2 stocks hit for more than a quarter of their value with Nearmap taking a beating from investors today. The mapping tech company gave an FY20 update this morning that showed annualized contract value (ACV) rise 23% over the calendar year as at the end of December, climbing to $96.6m. while the growth is impressive, the company downgraded ACV expectations for the financial year end by around 10% to $102m-$110m on the back of some large contract churn events in North America. The downgrade came on the back of a large partner cancelling their contract and two downgrades to autonomous vehicle contracts. We spoke about the increase in competition in the space in the Tuesday morning report with Aerometrex (AMX) listing on the ASX late last year, raising money to push for growth. The key for Nearmap’s longevity is scale and today’s announcement set them back a bit in terms of really commercializing the product. The market was concerned that the company’s investment in customer experience has come back to bite them. Similar to TWE yesterday, a lower growth rate was punished by the market. Not one to be a hero in for now. Nearmap (NEA) Chart NEA Daily Chart

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