Gentrack (ASX:GTK) share price rockets 27% on revenue upgrade

Shares in this Kiwi software company are rocketing higher today

| More on:
These three ASX mining shares rocketed by more than 20% today

Image source: Getty Images

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

The Gentrack Group Ltd (ASX: GTK) share price is on fire this morning. Shares in the software company have jumped 27.7% in early trade after an important ASX announcement.

Gentrack share price rockets higher on revenue upgrade

This morning's market announcement represented an FY21 trading update from the enterprise billing software provider.

Gentrack reported revenue in the second half of the year being "stronger than expected" across its utilities segment. The software group said that reflects early positive signs of its strategy to grow revenues by "providing innovative technologies and services to existing customers, win new business and expand into managed services".

The positive update sparked interest in the Gentrack share price which surged higher at the open. Full year revenue guidance was updated to be approximately $105 million for the group.

The company has previously forecast revenue "slightly ahead of $100.5 million" while earnings before interest, tax, depreciation and amortisation (EBITDA) guidance was bumped from $10 million to $12 million.

Increased incremental revenue, higher throughput and slower than expected increases in research and development expenditure were all sighted as key factors in the higher figures.

While an energy crisis in Europe looms, Gentrack said its core UK energy market exposures remain limited. That's thanks to a number of factors including:

  • Increased focus on working capital management reducing individual customer exposures;
  • Diversified business across B2B, B2C and Water business lines as well as geographies; and
  • Increased revenue forecasts for FY2022 even after accounting for headwinds.

Foolish takeaway

Investors have pounced on this morning's update and sent the Gentrack share price soaring higher on Thursday. Shares in the Kiwi software group have been volatile throughout 2021 but have now climbed 11% in the last 5 days.

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Technology Shares

A female soldier flies a drone using hand-held controls.
Technology Shares

DroneShield shares charge higher on European expansion plans

This high-flying stock is surging again on Tuesday. But why?

Read more »

Human head and artificial intelligence head side by side.
Technology Shares

NextDC share price jumps 8% on big news

Another big announcement has caught the eye of investors this morning.

Read more »

A man sits in contemplation on his sofa looking at his phone as though he has just heard some serious or interesting news.
Technology Shares

Up 60% in two months, is it too late to buy Pro Medicus shares?

Pro Medicus has been delivering solid returns for years. Can the trend continue?

Read more »

Group of people in a gym high five each other surrounded by gym equipment.
Mergers & Acquisitions

This ASX tech stock is hitting a record high on acquisition news

The market is responding positively to this news. Let's dig deeper into it.

Read more »

A man in a suit face palms at the downturn happening with shares today.
Technology Shares

Guess which ASX 300 share is crashing 17% on shock news

Investors are rushing to the exits on Thursday. Let's find out why.

Read more »

Cheerful boyfriend showing mobile phone to girlfriend in dining room. They are spending leisure time together at home and planning their financial future.
Technology Shares

These were the best ASX 200 tech stocks to buy in May

Shareholders of these shares were smiling last month. But why?

Read more »

A woman smiles as she sits on the bus using her phone and listening to music through headphones.
Technology Shares

Here's why I think these ASX tech shares are buys in June

These stocks have loads of potential.

Read more »

A young man wearing a black and white striped t-shirt looks surprised.
Technology Shares

Why did the Life360 share price rocket 51% in May?

This ASX 200 stock smashed the market last month with an incredible gain.

Read more »