Has the Matterport stock hit rock bottom? In search of the silver lining

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Supply chain disruptions are so severe that shortages even ripple through the metaverse. On the back of his Q4 report, Matterport (MTTR) reported that camera supply constraints along with slowing paid subscriber growth trends are responsible for lower growth prospects in 2022.

The spatial data company expects first-quarter revenue to be between $25.5 million and $27.5 million, some distance below Wall Street’s forecast of $31.86 million.

Recurring subscription revenue is expected to be between $17.1 and $17.4 million, representing year-over-year growth of 24% to 26%. Paid subscriber growth has already declined to 25% in the fourth quarter from 35% in the prior quarter and 82% in 1H21.

Looking at the quarterly display, revenue rose 14.8% year-over-year to $27.08 million, in turn beating analysts’ call of $1.94 million. Non-GAAP EPS of -$0.10 matched the consensus estimate.

Positives include growth in the freemium subscriber base, which accelerated during the quarter. The company saw 118,000 net additions, with the freemium base reaching over 500,000 users, representing a 139% growth over the same period last year and higher than the 136% increase in the previous quarter. Higher average spend per customer also helped partially offset modest paid subscriber additions.

While Piper Sandler analyst Brent Bracelin admits that near-term operating trends “remain volatile and difficult to predict,” he notes the positives from the quarter.

“We are encouraged by the record net freemium user additions of 118,000 during the fourth quarter and the longer-term potential for digital twin use cases in the residential and commercial segments,” said analyst 5 star who remains “optimistic about the long-term opportunity”. ”

As such, Bracelin reiterated an overweight (i.e. buy) rating for MTTR stocks. However, given “significantly lower” earnings estimates, the analyst reduced his price target from $26 to $10. That said, following the recent stock price wipeout (down 68% year-to-date), the figure is still around a 53% upside from current levels. (To see Bracelin’s track record, Click here)

Overall, Matterport still enjoys full street support; the 6 reviews recorded are positive, which gives the title a consensual strong buy rating. The average price target remains optimistic; at $16.17, the figure suggests the stock will produce returns of 147% over the next 12 months. (See Matterport stock analysis on TipRanks)

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Disclaimer: Opinions expressed in this article are solely those of the featured analyst. The Content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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