The Updater Inc (ASX: UPD) share price stormed 10% higher to an all-time high of $1.31 today after US-based the technology company released its half-year update.
This has brought its year-to-date gain to a staggering 190%.
What happened in the first-half?
As Updater isn't widely known, I feel it is best to start with a little introduction.
The company aims to make the moving process easier for the estimated 17 million households that relocate each year in the United States.
To do this it provides a software platform which allows its users to seamlessly transfer utilities, update accounts and records, and forward mail.
Whilst at this stage the company is generating only small amounts of revenue, once the company has penetrated the market significantly I believe it will put it in a strong position to generate significant revenue streams by connecting businesses with movers.
After all, US businesses are spending billions of dollars trying to reach movers each year. If this can be done cost-effectively through its platform, I expect Updater could be in a great position to profit.
Which brings us on to the company's market penetration for the first-half. As of the end of July, Updater's estimated market penetration has hit an all-time high of 15.7%, compared to approximately 7% a year earlier.
During the month of July the company processed 234,503 unique household moves.
Impressively, this growth is ahead of even management's expectations and means that it has hit its year-end goal five months ahead of schedule.
Should you invest?
Whilst it certainly is trading on a lofty valuation considering it generated just US$500,000 of revenue during the half, I do believe that the company has a significant opportunity to monetize its platform in the future.
In my opinion this could more than justify the premium its shares trade at today.
But it isn't without risk of course. If the company fails to monetize the platform as successfully as the market is pricing in, then its shares could come tumbling down.
So I would suggest investors restrict any investment to just a small part of their portfolio.
