Search ASX code:
Generic filters

Time to buy Volpara (ASX:VHT) shares after good Q2 growth?

The Volpara Health Technologies Ltd (ASX: VHT) share price is up in reaction to the healthcare tech share’s FY21 second quarter update.

Volpara’s strong quarter

The company reported that quarterly cash receipts from customers remained strong despite COVID-19, dropping by 4% due to the shift to a software as a service (SaaS) model. Subscription receipts rose by 16% to NZ$4.7 million. Cash receipts were up 33% for the half.

Volpara said that it generated NZ$9.5 million of revenue for the first half of FY21, this was up 38% compared to the first half of FY20. Subscription revenue was up 71%.

Annual recurring revenue (ARR) reached NZ$19.9 million with average revenue per user (ARPU) reaching US$1.16.

Management said that customer churn is negligible and its US coverage remains approximately around 27%.

The FDA update on breast density reporting requirements remains pending.

Volpara CEO Dr Ralph Highnam said: “We see little material changes in our overall cash receipts due to COVID-19, which shows the resilience of our industry and business model. Recurring business is a strong indicator not only of an industry responsive to change but of innovative products continuing to meet the needs of customers during a challenging time.”

 Summary

Volpara is a quality business that I think is definitely worth watching. The shift to a SaaS model should help it grow further in the coming years with better margins and more reliable cashflow.

I’d be happy to buy some shares for the long term today, but the company has to keep growing towards good profitability to justify the expectations built into the current Volpara share price. There are other ASX growth shares I’d also be interested in such as Pushpay Holdings Ltd (ASX: PPH).

1 ASX Stock to Buy RIGHT NOW...

Our top analyst has just identified his #1 'MedTech' stock idea for 2021 and beyond.

Click here or enter your email address below to access the stock code, 3,500-word analysis and founder interview. Our top expert's free investment reports are exactly that -- completely free! No gimmicks, just expert-proofed stock research and more.

Enter your email below to receive his free report.

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

1 ASX Stock to Buy RIGHT NOW...

Our top analyst has just identified his #1 'MedTech' stock idea for 2021 and beyond.

Click here to access the stock code, 3,500-word analysis and founder interview. Our top expert's investment reports are completely free with a Rask Australia account. No gimmicks, just free stock research and more. Click here now to get the report.

At the time of publishing, the author of this article does not have a financial or commercial interest in any of the companies mentioned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

Keep reading: