Seeing Machines (LON: SEE) share price has been under pressure in the past few months even as the company recorded strong revenue growth. The stock was trading at 5.65p on Friday, a few points below last month’s high of 6.11p. In all, the shares have crashed by more than 56% from the highest point in 2022.
Growth is continuingSeeing Machines is a technology company whose goal is to improve the safety in the transport industry. The company developed Guardian, a product that uses cameras to provide eye and face-tracking solutions to reduce accidents. It has also incorporated the concept of artificial intelligence (AI) to improve its solutions.
Seeing Machines is used by Original Equipment Manufacturers (OEMs) who install the product in vehicles. Most importantly, companies with large fleets install the system to reduce accidents.
Seeing Machine’s business is doing modestly well, as evidenced by the last financial results. The company’s revenue jumped by 49% to $57.8 million in the last financial year. Its closely watched annual recurring revenues rose by 27% to $13.6 million. Over 1.08 million cars are using the product.
It also partnered with Magna International, the large company that is manufacturing vehicles for Fisker Automotive. As part of this partnership, Magna invested $65 million in the company, which helped it boost its balance sheet.
Therefore, Seeing Machines seems like a good company based on its strong revenue growth, brand awareness, and more user growth. It is also doing well in the aftermarket business.
The most recent results did not provide details about the company’s profits or loss. Analysts believe that the company will likely make another loss this year as it works toward profitability in financial year 2025. Most importantly, the company believes that the aviation business will start contributing positive results to its business. The CEO recently said:
“We can now expect Aviation to be a meaningful contributor to the Company’s revenue and looming regulatory deadlines are driving the rapid adoption of Driver Monitoring Systems by automotive manufacturers.”
Seeing Machines share Price Forecast
The daily chart shows that the Seeing Machines stock price has moved sideways in the past few days. As a result, it is consolidating at the 25-day and 50-day moving averages. The shares are also slightly above the important support at 5.17p, the lowest point in August 22nd and 28th 2022 and July 28th this year.
Therefore, the outlook for Seeing Machines is neutral with a bullish bias since it has formed a small flag pattern. If the bullish breakout happens, the next level to watch will be at 7.43p, which is ~30% above the current level. The alternative scenario is where the shares retests the support at 5.17p.
The post Seeing Machines shares: neutral outlook with a 30% upside appeared first on Invezz.
