Healthcare company Volpara Health Technologies Ltd (ASX: VHT) has seen its share price rise more than 4% this morning.
Volpara describes itself as a ‘MedTech Software as a Service’ company that was founded in 2009 on research conducted at Oxford University. Its software is used for screening clinics to provide feedback on breast density, compression, dose and quality. Its VolparaEnterprise business provides role-specific dashboards and wide-ranging benchmarking analytics to help clinics manage their business more efficiently.
Volpara’s FY20 First Quarter Trading Update
Volpara is presenting at the Bioshares Biotech Summit in Queenstown today and decided to include an update about its first quarter of FY20.
The company said that it has reached NZ$14.6 million of annualised recurring revenue (ARR). Volpara also said that it is on track to meet its guidance for the financial year of NZ$17.1 million.
After the recent MRS Systems acquisition, the company’s combined US market share has reached approximately 25%.
The MRS systems acquisition increased the number of US breast clinics to which the company has access to from around 400 to over 2,000, being an increase of around 400%.
The idea of the acquisition is that it will provide stronger technical expertise, a significant increase of ARR, accelerated sales through cross-selling opportunities and increased potential average revenue per user (ARPU) through new products.
Is Volpara A Buy?
These days the best growth shares are tech shares that have high profit margins, a good amount of recurring revenue, support attractive industries with the software and have a good growth runway.
I think Volpara fits this description but I’m not sure how big its market opportunity is. I certainly think it could create more growth outside of the US. Canada and Europe would be attractive additional locations to expand in.
I’m not sure if Volpara is nicely priced at today’s value, low interest rates make it a difficult environment to invest in. But I do think it’s worth watching along with the two growth shares in the free report below.
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