Why is the Volpara share price rocketing 13% today?

This health technology share is catching the eye with a very strong gain on Tuesday.

| More on:
A man has a surprised and relieved expression on his face. as he raises his hands up to his face in response to the high fluctuations in the Galileo share price 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

sdf

The Volpara Health Technologies Ltd (ASX: VHT) share price is taking off on Tuesday.

In afternoon trade, the health technology company's shares are up 13% to 72.5 cents.

Why is the Volpara share price rocketing?

Investors have been buying the company's shares today after responding very positively to its quarterly update.

According to the release, for the three months ended 30 September, Volpara reported record cash receipts of NZ$11.5 million. This was up 32% over the prior corresponding period.

In addition, the company finished the period with contracted annual recurring revenue (CARR) of ~US$28.4 million (~NZ$46.3 million), which is up over US$1.2 million since the end of June.

Also growing was Volpara's annual recurring revenue (ARR), which is now ~US$22.5 million (~NZ$36.6 million). This is up from US$21.5 million in the prior quarter.

But arguably the most important number on this release, and the one giving the Volpara share price the biggest lift, was its cash flow.

The company reported positive net operating cash flow of NZ$1.2 million for the quarter. This is the fourth consecutive quarter of positive net operating cash flow. Impressively, this means Volpara achieved its cash flow target 18 months ahead of plan.

In light of this achievement, the company is no longer required to provide Appendix 4C quarterly reporting updates. However, management advised that it remains committed to providing regular operational and financial updates to shareholders and will therefore release business updates periodically.

A milestone quarter

Volpara CEO's and Managing Director, Teri Thomas, appeared to be rightfully pleased with the quarter. Thomas said:

What a milestone quarter for us! I'm delighted to see current customers, happy with our software, expand their use of Volpara to save even more families from cancer. We had a record number of contracts up for renewal and customers have chosen to expand and extended their contracts with us for longer, with more software than ever before. Our record cash receipts reflect the positive impact we have on families, as happy customers pay their bills.

Our growth and financial strength, approaching US$100M TCV, allows us to turn increasingly to growth endeavours like a brand-new product, called Quiver, due out next year. Leveraging our Analytics platform, this new product provides administrative simplification for mammography centres so they can spend more time with patients. We do good and we do it well and that is reflected in this positive quarter.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Volpara Health Technologies. The Motley Fool Australia has positions in and has recommended Volpara Health Technologies. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Healthcare Shares

Cropped shot of an attractive young female scientist working on her computer in the laboratory.
Healthcare Shares

3 ASX companies that are global leaders

Numerous ASX companies have extended their reach beyond Australia to dominate in their fields.

Read more »

Three people in a corporate office pour over a tablet, ready to invest.
Broker Notes

Bell Potter just slapped a buy on this ASX 200 share offering a 30% return

Which stock is being tipped as a buy? Let's find out.

Read more »

Happy healthcare workers in a labs
Healthcare Shares

Macquarie initiates coverage of Neuren Pharmaceuticals shares; forecasts 45% upside

The broker described Neuren as a standout in the ASX biotech sector.

Read more »

A woman leans forward with her hand behind her ear, as if trying to hear information.
Healthcare Shares

Does Macquarie think Cochlear shares are a buy, hold, or sell?

Macquarie has released a new note on Cochlear following the company's FY25 profit guidance change.

Read more »

Stethoscope with a piggy bank in the middle.
Healthcare Shares

Up 18% this year, does Macquarie expect NIB shares to go higher?

This expert has a bold prediction for NIB.

Read more »

Cropped shot of an attractive young female scientist working on her computer in the laboratory.
Healthcare Shares

Why is the Mesoblast share price up 11% in June?

The ASX biotech share reached a 10-week high of $1.94 today.

Read more »

Shot of a scientist using a computer while conducting research in a laboratory.
Healthcare Shares

Up 51% since the tariff pain, is it too late to buy Pro Medicus shares?

After rocketing higher, is the ASX healthcare share still an opportunity?

Read more »

A woman wearing a yellow shirt smiles as she checks her phone.
Healthcare Shares

CSL shares push higher on US FDA approval

This biotech giant has been given a boost in the United States.

Read more »