Wishpond Technologies Ltd is seeing near-term momentum within its core market following positive second-quarter results that beat on revenue, according to Canaccord Genuity (TSX:CF, LSE:CF).
Wishpond’s second quarter showcased record revenue of just over $5 million, a 55% increase from a year ago, on the back of an expanded sales team, new product introductions and acquisitions.
In a note following the technology company’s results, analysts at Canaccord said the quarter highlighted its early execution in driving the top line, as cash flow improved in the face of a “challenging” economic backdrop.
READ: Wishpond Technologies achieves record revenue for 2Q as sales team expansion and new product introductions fuel growth
“Wishpond is seeing unchanged near-term momentum within its core (small and medium businesses) end-market as it pivots toward stickier, services-type customers with higher lifetime values,” Canaccord wrote.
Wishpond, a marketing-focused online business solutions provider, also revealed that it has returned to net positive cash from operating activities of $81,354 for the second quarter, compared to a loss of $801,512 in the same quarter a year ago.
“Notably, management is seeing a rising mix of annual-paid contracts and generally declining churn, a dynamic we expect to improve further as higher-value, annual-paid product bundles are set to launch in (the second half of 2022),” analysts at Canaccord wrote.
Canaccord did note that management has scaled back on its hiring as it looks to balance this growth with strengthening its near-term cash flow profile. “Our modest forecast tweaks primarily reflect this slower sales team expansion,” the group wrote.
Canaccord is maintaining its Speculative Buy rating and C$1.75 price target.
Shares of Wishpond traded around C$0.89 on Thursday.
Contact Angela at angela@proactiveinvestors.com
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