Should you buy Technology One shares after their November surge?

Technology One Ltd (ASX: TNE) shares have been among the top performers on the ASX 200 in November after a strong full-year result.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Technology One Limited (ASX: TNE) shares have been quietly climbing higher in November. The group's shares are up 24.15% this month and closed trading at $9.15 per share yesterday afternoon.

These strong capital gains put the Technology One share price right up there with the best ASX 200 stocks in November.

So, is the Technology One headed higher in December and should you be getting your piece?

Why Technology One shares have jumped in November

It's been an unusual year for Technology One shares, which climbed as high as $9.40 per share before plummeting 31.10% to $7.17 in the space of a week.

That hasn't been the case in November as the group's share price climbed higher on a strong full-year result.

FY19 net profit came in at $76.4 million with revenue of $286 million for the year ended 30 September 2019.

It was a solid result for a company that has been up and down throughout this year. This was in stark contrast to May's half-year result, which saw the group's shares plummet lower.

The company's software-as-a-service (SaaS) business has been growing strongly and I think the FY19 result surprised investors after a weak second half outlook in May.

Is December the time to buy?

Despite the strong performance in November, I think Technology One shares remain an uncertain option.

The software group has been boosted by the success of the sector as a whole in the last decade or so. While Technology One is well-established, I think there could be further growth potential elsewhere on the ASX.

I personally would be looking at a company such as Nearmap Ltd (ASX: NEA) if you want tech growth in December.

Nearmap shares are trading at $2.79 per share and could be good value if they can climb towards their $4.29 52-week high in the next few months.

Nearmap has a market cap of $1.26 billion compared to Technology One's $2.91 billion valuation.

Motley Fool contributor Kenneth Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Gainers

A young woman smiles as she rides a zip line high above the trees.
Share Gainers

Here are the top 10 ASX 200 shares today

ASX investors kicked off the trading week in style today.

Read more »

Person pointing at an increasing blue graph which represents a rising share price.
Share Gainers

Why Liberty, Lovisa, Novonix, and SG Fleet shares are storming higher today

These shares are starting the week strongly. But why? Let's find out.

Read more »

Young girl drinking milk showing off muscles.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a great end to the trading week for ASX investors today.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Share Gainers

3 ASX 200 stocks smashing the benchmark this week

These three ASX 200 stocks are leading the charge this week. Here’s how.

Read more »

A young woman holding her phone smiles broadly and looks excited, after receiving good news.
Share Gainers

Why A2 Milk, EOS, GQG, and Mineral Resources shares are racing higher today

These shares are ending the week strongly. But why?

Read more »

A man wearing a red jacket and mountain hiking clothes stands at the top of a mountain peak and looks out over countless mountain ranges.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another disappointing day for ASX investors this Thursday.

Read more »

two men smiling with a laptop in front of them, symbolising a rising share price.
Share Gainers

Why Pinnacle, PWR, Race Oncology, and Vulcan shares are flying today

These shares are having a good session on Thursday. But why?

Read more »

A beautiful woman holds up one finger with one hand and has her hand on her waist with the other as she smiles widely as though she is very pleased about something.
Share Gainers

Why Boss Energy, Emeco, Mineral Resources, and Plenti shares are pushing higher today

These shares are having a good time on hump day. But why?

Read more »