The Altium Limited (ASX: ALU) share price has rocketed to an all-time high in early trade.
At the time of writing the electronic design software platform provider's shares are up 24% to $33.50.
Why are Altium's shares at an all-time high?
Investors have responded incredibly positively to the company's half year results which were announced after the market closed on Monday.
During the six months ended December 31, Altium posted half year revenue of US$78 million, EBITDA of US$28.4 million, profit after tax of $23.4 million, and earnings per share of 18 U.S. cents.
This represented revenue growth of 26% and net profit after tax growth of 58% on the prior corresponding period.
The star of the show for Altium during the first half was its Board and Systems segment. Revenue in the segment grew 17% to US$58.4 million, representing ~75% of total revenue.
This was driven by increasing demand for its software across the globe and notably in China, which led to a 34% increase in Altium Designer new seats and a 9% lift in the overall subscription pool to 39,179.
Supporting this growth was its promising Octopart business. Revenue jumped 80% to US$8.9 million during the half. I think this strong result demonstrated why the search engine for electronic and industrial parts could be a key driver of its future growth.
Elsewhere, TASKING revenue lifted 35% to US$8.4 million and NEXUS revenue rose 20% to US$2.4 million.
What now?
Another reason that investors may be fighting to get hold of its shares today is the fact that management advised that it has no doubt that it will achieve its 2020 target of revenue of US$200 million and an EBITDA margin of at least 35%. In fact, in respect to the latter, during the half the company's EBITDA margin expanding to 36.3% from 30% in the prior corresponding period.
Further boosting investor sentiment, management revealed an "aspirational" revenue target of US$500 million by 2025.
Given the quality of its products and the proliferation of electronics through the rise of smart connected devices, I think it has a great chance of achieving its long-term growth targets.
As a result, I continue to see it as a great buy and hold option along with Appen Ltd (ASX: APX) and Xero Limited (ASX: XRO).
