About: Nearmap is an Australian aerial imagery technology and location data company that provides frequently-updated, high-resolution aerial imagery of 88% of Australia's population, 68% of the US population, and 72% of the New Zealand population.

Why it’s in the portfolio: Nearmap has so far been a success story for ASX listed companies, particularly in 2019. The stock is up over 6000% from its original IPO offer of $0.05 (written as at May 2019). The company has attractive growth prospects and current market conditions imply that there is no reason for this to slow anytime soon. Aerial imagery is a $22bn industry and Nearmap appears competitively placed to increase its market share. The company reported strong half-year earnings in 2019, boosted by an almost 50% jump in YoY revenue growth. Management were also able to reduce net loss by 70%.

Fundamentals: Nearmap has a current market capitalisation of $1,670m and an estimated annual revenue of $77m. Although it’s predicted to run at a small operating loss for FY19 (-$6m) this still implies YoY EPS growth is expected to increase by over 56%.

What could go wrong? Nearmap admits that it needs to focus on the ‘long-tail’ of the small to medium sized business industry of the US, as much of the companies success has been attributed to the companies ability to win large contracts and government work. Slower than expected adoption and slowing subsidisation may impede growth and require means of diversification for management.