2 ASX Small Caps for Big Gain

Nearmap Ltd, resilient business with a strong growth trajectory

Team Veye | 10 July 2020 | ASX – NEA

Nearmap Ltd (ASX: NEA)

ACV exceeds $102m, commercial launch of Nearmap AI

Nearmap Ltd (ASX: NEA) on 28 May 2020 provided a further update on current trading conditions, the launch of commercially available Artificial Intelligence (AI) content and an update on previously announced cost management initiatives

(Chart source: TradingView)
  • Annualised Contract Value (ACV) continues to grow, now exceeding $102m (using an AUD/USD constant currency FX rate of $0.70), and guidance has been narrowed to $103m$107m
  • Nearmap AI will be launched and commercially available via self-service export and offline channels in Australia and the United States on 1 June 2020
  • Cash management initiatives have been implemented and the Company is on track to be cash flow breakeven by 30 June 2020
  • Closing FY20 Group cash balance expected to be between $32m-$35m
  • Productivity levels maintain unchanged as employees continue working remotely, and Nearmap will consider a phased return to the workplace in line with government guidelines

 

Innovation milestone – the launch of Nearmap AI

Nearmap also announced the commercial release of its new product, Nearmap AI. A freshly processed set of AI dataset packages will be available to all subscribers in Australia and the United States. Initial focus will be on insurance, utility and local government who have been early adopters while in beta and where demand is strongest. To access Nearmap AI subscribers purchase online or offline export credits, valid for an annual contract period to export AI derived location intelligence content. (Data Source – Company Reports)

 

Veye’s Take

Nearmap has performed well and continued to grow its month on month portfolio while trading conditions in the global economy become more challenging. With the commercial roll-out of 3D and roof geometry, Nearmap AI is another significant milestone as the Company continues to enhance its market leading technology position. Nearmap has been implementing a number of cash management initiatives to preserve cash and strengthen its balance sheet. It is on track to become a cash flow break-even by the end of FY20. The daily and monthly charts reflect growing momentum. Since RSI is turning down, the stock may come in for some correction. But, in the long run, it can have the potential to grow very nicely. The acceleration in momentum may come once it stays above $2.32 for a couple of days. Just on 23 April 2020, we had recommended a “Buy” on it at the price of $1.28. It has already grown by more than 78% in less than one and a half months till now. Veye maintains a “Buy” on “Nearmap Ltd” at the current price of $2.34

Harvest Technology Group Limited, unique opportunity in the multi-billion-dollar sector

Team Veye | 10 July 2020 | ASX – HTG

Harvest Technology Group Limited (ASX: HTG)

Harvest Technology Group to Raise $10 Million to Accelerate Growth

Harvest Technology Group Limited (ASX: HTG) (“Company”) on 12 June 2020 announced that it had received binding commitments to raise $10 million (before costs) in new equity via a fully committed share placement to a mix of existing, institutional and sophisticated investors (“Placement”).

  • Harvest Technology Group has received binding commitments to raise $10 million (before costs) via a private Placement
  • Participants in the Placement included a mix of existing, institutional and sophisticated investors
  • Funds will be used to accelerate and support planned product development initiatives, and progress new strategic partner alliances to increase market penetration
  • The Placement ensures the Group is well capitalised to continue execution of its growth strategy
(Chart source: TradingView)
  • Harvest Technology Group Limited on 30 April 2020 reported a record underlying operating performance for the March 2020 quarter.

    Highlights: 

    • Company name change to Harvest Technology Group Ltd (ASX: HTG). Subsidiary Advanced Offshore Streaming Pty Ltd renamed to Harvest Infinity Pty Ltd as part of Group rebranding strategy to target global customer base
    • Harvest Technology Pty Ltd achieved more than $10 million in annual revenue by end of March 2020
    • Highest ever quarterly cash receipts of $5.9m and positive operating cash flow of $752,000 with a cash balance of $1.4m at end of the quarter
    • Continued utilisation of the “VOS Shine” across multiple contracts in the Bass Strait
    • Infinity suite of products underwent rebranding and release to market with strong interest from many sectors
    • Harvest Infinity entered into an initial agreement with Applied Satellite Technology Australia (AST) in April 2020 to jointly market and distribute its proprietary remote communication technology (Data Source – Company Reports)

     

    Veye’s Take

    The Company has a unique opportunity in the multi-billion dollar satellite communications sector. HTG can increase growth with the use of its industry-agnostic proprietary technology that allows real time, secure, encrypted high definition transfer of video, audio and data from anywhere in the world. The funds will arm the Company with the ability to take advantage of this opportunity by embarking on an aggressive program of product development and speed to market. The stock is moving up on both short term and long term charts. It is trading above 50 and 200 MA on both daily and weekly t/f. MACD has again crossed over. The stock can have the potential of growing significantly. It can also gain further momentum above $0.32. Veye recommends a “Buy” on “Harvest Technology Group Limited” at the current price of $0.27 

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