Up 102% in a year, can this ASX small-cap technology company keep on rising?

Smart Parking shares have doubled over the past year.

| More on:
A woman looks over her shoulder towards the back seat while sitting at the wheel of a stationary car with a serious look on her face.

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

Investing in ASX small-cap shares has its risks, but it can also yield outsized gains.

One example is Smart Parking Ltd (ASX: SPZ), whose share price has doubled over the past year. For context, the S&P/ASX Small Ordinaries Index (ASX: XSO) and the All Ordinaries Index (ASX: XAO) have advanced by approximately 6% during the same period.

Created with Highcharts 11.4.3Smart Parking PriceZoom1M3M6MYTD1Y5Y10YALL17 Jul 202315 Jul 2024Zoom ▾Sep '23Nov '23Jan '24Mar '24May '24Jul '24Oct '23Oct '23Jan '24Jan '24Apr '24Apr '24Jul '24Jul '24www.fool.com.au

Can Smart Parking keep doing its smart magic?

Why did Smart Parking shares soar?

As the company name implies, it specialises in cutting-edge parking technology. It provides real-time space availability, efficient space management, and seamless payment solutions.

Smart Parking's stock has been rising due to the company's strong business performance. The provider of car parking technology has been rapidly expanding its presence in Australia, New Zealand, and Europe. The number of parking sites under management has increased from 286 in June 2018 to 1,219 in December 2023.

Such rapid expansion of its car parks under management led to strong financial results. In 1H FY24, which ended on 31 December 2023, the company delivered a 20% revenue growth to $26.6 million and a 26% growth in its earnings before interest, taxes, depreciation, and amortisation (EBITDA) to $6.7 million.

The company has been rapidly expanding its presence in Europe. Smart Parking initially focused on growth in the UK, then expanded to New Zealand in FY21, Australia and Germany in FY22, and most recently Denmark.

The company's total addressable market is growing as the overall market expands. There are 45,000 parking sites in the UK, 90,000 in Germany, and 10,000 in Denmark, totaling 145,000 in these three countries. Smart Parking currently holds less than 1% market share in these areas.

Business outlook

Smart Parking's growth comes from its operations' scalability and the ongoing expansion. In March 2024, the company acquired Local Parking Security in the UK, adding 126 new parking management sites.

Management is optimistic about the future. In the 1H FY24 update, the company reaffirmed its target to reach 1,500 sites under management by December 2024, marking a 25% increase from its December 2023 figure.

The company also sees "significant new interest and investment from private equity in the UK private parking management market." Two transactions in 1H FY24 demonstrate the attractive growth opportunity in the UK, the company added.

How expensive are Smart Parking shares?

Smart Parking shares are valued at a price-to-earnings (P/E) ratio of 28x based on its trailing 12 months' earnings and 22x based on FY25 earnings estimates by S&P Capital IQ. Compared with a few other ASX technology small-cap shares, using S&P Capital IQ estimates:

  • VEEM Ltd (ASX: VEE) shares are valued at 31x FY25 earnings estimates
  • DUG Technology Ltd (ASX: DUG) shares are valued at 36x FY25 earnings estimates
  • IPD Group Ltd (ASX: IPG) shares are valued at 17x FY25 earnings estimates

The Smart Parking share price is down 1% at $0.54 at the time of writing.

Should you invest $1,000 in Apa Group right now?

Before you buy Apa Group shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Apa Group wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor Kate Lee 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 Dug Technology, Ipd Group, and Veem. The Motley Fool Australia has positions in and has recommended Ipd Group. The Motley Fool Australia has recommended Dug Technology and Veem. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Technology Shares

group of traders cheering at stock market
Technology Shares

What drove a 10% surge in ASX 200 tech shares last week?

The ASX 200 roared to a 2-month high on Friday, with tech shares leading the 11 market sectors last week.

Read more »

A man slumps crankily over his morning coffee as it pours with rain outside.
Technology Shares

Why is the Block share price crashing 33%?

This payment giant's shares are being hammered today. But why?

Read more »

A young man pointing up looking amazed, indicating a surging share price movement for an ASX company
Technology Shares

These ASX 200 tech stocks could rise 20% to 35%

Goldman Sachs is tipping these shares to rise strongly from current levels.

Read more »

A corporate team or board stands together and looks out the window.
Technology Shares

WiseTech shares charge higher on $3.5b acquisition news

This tech stock is ending the week positively. But why?

Read more »

A man leans forward over his phone in his hands with a satisfied smirk on his face although he has just learned something pleasing or received some satisfying news.
Technology Shares

3 reasons to buy this $25 billion ASX 200 tech stock today

A top expert forecasts more outperformance from this fast-growing ASX 200 tech stock.

Read more »

Lines of codes and graphs in the background with woman looking at laptop trying to understand the data.
Technology Shares

Why is the Brainchip share price crashing 9% today?

The semiconductor company is being sold off on Tuesday. But why?

Read more »

A man with a wide, eager smile on his face holds up three fingers.
Technology Shares

3 reasons this sold-off ASX 200 share is primed for a big rebound

A leading expert believes this ASX 200 share is well placed to outperform.

Read more »

a man surrounded by huge piles of paper looks through a magnifying glass at his computer screen.
Technology Shares

I did some research on Siteminder — Here's what you should know

The big questions I'm monitoring for answers.

Read more »