Nearmap Ltd (ASX: NEA) has copped a speeding ticket from the market regulator after its shares soared by as much as 11% during yesterday's session on unusually high volumes, maxing out at 63.5 cents before ending the session at 62 cents (compared to 57 cents on Friday).
In response to the ASX's query, Nearmap said that it was not aware of any information concerning it that has not already been announced to the market, nor is it aware of any other explanation which could explain the unusual trading activity.
It's entirely possible that the market could simply be cluing onto Nearmap's enormous potential, both locally and internationally. The company, which boasts a market value of just $220 million, provides geospatial mapping technology which is proving incredibly useful for businesses and government customers.
While it has already proven its potential in Australia, it is excelling in its expansion into the United States market which could yield enormous returns for the company. It recently announced that it had made its first commercial sale in the US (ahead of schedule) and reaffirmed its target of the aspirational US revenue run rate of $30-50 million by December 2017. It has set the same target for Australian revenues by December 2015.
The stock has traded within a wide price range over the last 12 months with a low of 38 cents and a high of 83.5 cents, while Foster Stockbroking has given it a $1.28 price target. That represents a potential 106% gain from today's price tag – a target which I believe could be dwarfed over the coming years should the company succeed in its expansion plans.
