Matterport (MTTR), a spatial data firm, offers a platform for capturing and experiencing 3D photos and models. To put it another way, it allows users to construct immersive 3D digital reproductions of real-world buildings and spaces.
Matterport became public through a SPAC transaction on July 23. Since then, the company's stock has increased by almost 83%. The rapid digital revolution is benefiting the organization.
Recently, the company released its Q3 earnings results, which was a mixed bag. Revenue increased 10% year-over-year, but fell short of Wall Street's estimates, while the bottom line came in marginally better than expected.
The substantial gain in subscription revenue, which increased 36% year-over-year, was the highlight of the quarter. However, owing to supply problems, the firm cut its full-year projection.
Expert Confident, Post-Q3
In reaction to the company's Q3 results, Wedbush analyst Daniel Ives expressed confidence about the company's future prospects. He sees Matterport's transformation from a one-time purchase sales model to a subscription-based one as the major growth driver in the long run.
According to Ives, the company will benefit from the move in a variety of ways. He says Matterport will be able to "increase annual recurring revenue, have a greater focus on driving customer value, and build the pipeline while also increasing margin growth over time" as a result of the shift.
Apart from the aforementioned advantages, Ives feels that Matterport is well-positioned to benefit from the growing metaverse concept. After Meta Platforms (FB) revealed its plan to focus its resources on the metaverse, this new notion is already gaining traction. In July, the social media behemoth teamed up with Matterport to create the world's largest 3D interior space dataset.
"Matterport’s 3D images and technology will result in expanding partnerships on the metaverse (e.g. Facebook),” Ives explains, allowing the firm to “benefit from this massive spending wave on the horizon.”
Ives is optimistic about Matterport's “growth prospects over the next 12 to 18 months," based on his findings. As a consequence, he maintained his Buy rating on the company and increased his price target to $30 from $26.
Improved Website Traffic
Interestingly, we discovered that unique user visits to Matterport's website increased by 3.3% from September to October. Furthermore, this time was marked by rising stock values, which increased by 18.7%.
The growing number of visitors to Matterport's website reflects that the demand for the company’s products and services remains robust.
Wall Street’s Take
Turning to Wall Street, the analyst consensus also has a strongly optimistic stance towards the company, with a Strong Buy rating based on 4 unanimous Buys. The average Matterport price target of $27.25 holds an upside potential of around 5%.
Disclosure: At the time of publication, Shalu Saraf did not have a position in any of the securities mentioned in this article.
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