Birdman got into this stock over a decade ago, so he would do well if the SP hit $5. I being past four score and ten, can tell you that losing money on a punt is not painful, if one does not have sufficient years left to spend it.
To go from $1.25 to $5 is a four bagger. The SP may not get to $5 for many years, if ever, or it could hit $5 in two or so years hence. I bought CCP at $11.20 about two years ago, and sold in mid-january for $35.50. That is a 3+ bagger, so a four bagger is not ridiculous for a SaaS stock with a Cost of Service Sold being a flat $30m, and with a rapidly growing revenue in North America.
On the last point, once NEA covers a target geographic area, then for any given refresh frequency, the cost of data capture and service tends to be flat. The normal tendency of costs to rise would be mitigated by the effect of HyperCamera3. FY21's cost of $28.8m actually dropped relative to FY20's $30.6m.
One could extract FYH2's metrics from the FY21 Presentation to highlight the spurt in revenue growth that the FY21-on-FY20 report masks, and to reflect the change of other key metrics. I know that ACV growth grew 26.78% on the previous half, and that pace reflects a Y-on-Y of 1.2678^2 -1 = 60.73% per year. That growth seems to be too good to be true, which is another reason to wait for the H1FY22 Presentation.
Normally, I would not write a post like this without more detailed reasoning, but we are so close to receiving the H1FY22 Announcements, that I'll wait for them. If revenue keeps up to the previous Half-on-Half growth, the ramifications of the Net Profit/Loss before tax could be spectacular, and the SP reaction is anybody's guess. An SP of $5 two or so years hence would start looking plausible. Of course, things might transpire to be less rosy.
Further, there is that litigation that should drag on for a year or two. It is business-wise not that relevant, but many think it is relevant. Win, lose or draw, the finalisation of the matter is likely to give the SP an upward fillip, because the market reacts more negatively to no news than it does to negative news. I would not now be so bold as now, or soon, to call $5 as an SP within two or three years, but when the FY22 Annual Report is delivered, $5 could well be in the offing.
I sold my largest personal NEA holding at $2.71, and made a small profit after holding for a year. I now have a smaller holding in my SMSF that carries a small loss, but I am currently inclined to neither sell nor increase.
