The WiseTech Global Ltd (ASX: WTC) share price has been an incredible performer recently, up 80% in 2024 to date and more than 100% in the past 12 months. On Friday, shares in the ASX tech company hit a new 52-week high of $136.02.
The S&P/ASX 200 Index (ASX: XJO) has done well, but WiseTech has done much better. To date, in 2024, the ASX 200 has risen by 9% and is up around 17% in the past year.
Investors are loving the global progress that the ASX tech share is making.
Profit growth is a key driver of share prices over time and I think the recent FY24 result from the ASX tech share was excellent, which helped drive the WiseTech share price.
Image source: Getty Images
FY24 earnings recap
In the 12 months to 30 June 2024, total revenue increased by 28% to $1.04 billion, with CargoWise revenue increasing 33% to $880.3 million. It benefited from the full and part-year effect of acquisitions during FY23 and FY24, as well as customer growth, including new large global freight forwarder rollouts.
WiseTech's operating profit (EBITDA) grew by 28% to $495.6 million, underlying net profit increased by 15% to $283.5 million, and statutory net profit grew by 24% to $262.8 million.
It has been working on a company-wide cost efficiency program, which has achieved its goal and delivered $40 million annual run-rate savings with a $14 million annual cost cut in FY24. The program has been expanded with an updated target of $50 million annual run-rate savings.
Excitingly, the business also revealed expectations of further strong revenue growth in FY25, which may be a key reason for the recent performance of the WiseTech share price. In the 2025 financial year, the company expects revenue to rise by between 25% and 30% to between $1.3 billion and $1.35 billion.
It also predicted that profit margins would increase in FY25. Operating profit (EBITDA) is expected to rise by between 33% and 41% to $660 million to $700 million, with the EBITDA margin forecast to reach between 51% and 52%.
Where could the WiseTech Global share price be in 12 months?
Analysts have differing views on where they think the WiseTech share price will be in a year.
Currently, according to Factset, there are four buy ratings on WiseTech shares and 11 hold ratings.
Of those ratings, the average price target is $117.38, which implies a possible decline of approximately 13% from the valuation today. The most pessimistic price target is $100, which would represent a whopping 26% decline over the next year.
The highest price target is $38, which implies the WiseTech share price could increase by 2.1%. Overall, analysts don't appear to think there is much upside in the short term for the high-performing ASX tech share. However, stronger-than-expected profit growth could help push up the valuation.
