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.
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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