The modern day economy is favoring companies facilitating digital transformation. Take Matterport’s (MTTR) case, which provides 3D scanning products and solutions to scan any location and create a digital replica.
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Thanks to the favorable industry trends, Matterport is growing rapidly, reflected through its strong subscription revenue and expansion of its subscriber base. Meanwhile, its stock is up about 33% since listing on the NASDAQ on July 23. (See Matterport stock charts on TipRanks)
During the most recent quarter, Matterport’s subscription revenue jumped 53%. Meanwhile, its total subscribers increased 158% year-over-year to 404,000. Furthermore, the spaces under management grew to 5.6 million, up 75% compared to the prior year, which is encouraging.
Its unique business, shift toward subscription-based model, and growing applications into different sectors and verticals (including smartphone and Superyacht) apart from real estate, provide a strong underpinning for growth. I maintain a Bullish outlook on Matterport stock.
Highlighting its unique product offering and a large addressable market, Daniel Ives of Wedbush initiated coverage on Matterport stock with a Buy rating and a price target of $22 (16.5% upside potential).
The 5-star analyst stated that the company’s unique products are gaining traction in a large market with very limited competition. He added that this places Matterport “in a position to realize massive growth opportunities over the next decade.”
Ives remains upbeat over Matterport’s transition towards the subscription-based business model and expects the shift to drive its annual recurring revenues and margins. He added that the company successfully scaled and expanded into fast-growing markets like smartphones, and believes that Matterport is well-positioned to dominate the 3D scanning market, owing to the lack of competition.
Ives expects Matterport’s market penetration to increase over time, while he sees “its partnership with blue-chip players in their respective markets” as a “gamechanger.”
On TipRanks, Matterport has received 4 positive analyst reviews, for a unanimous Strong Buy consensus rating. The average Matterport price target of $20.50 implies 8.5% upside potential to current levels.
Furthermore, TipRanks’ Stock Investors tool indicates that investors currently have a Very Positive outlook on Matterport stock, with 15.1% of investors who hold portfolios on TipRanks increasing their exposure over the past 30 days.
Disclosure: On the date of publication, Amit Singh had no position in any of the companies discussed in this article.
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