NUIX listed on the ASX on 4 December 2020. The shares available at listing were taken up by select investors. The company’s market capitalisation was well in excess of $3 billion until Friday 26 February 2021. On that day its shares dropped in value by 32.44%.
A few weeks ago, we pointed out that the value of the company was almost 18 times revenue. Yes, Nuix seemed to tick all the boxes: tech, cloud, subscription revenue, global expansion potential and a poll position in a new and growing sector. However, this type of valuation has to imply some serious growth projections, if not in profit, then at least in revenue.
The company’s half year results (to December 2020) revealed negative revenue growth of -3.9% on the previous corresponding period. On an annualised basis contract revenue was trending at 3% growth.
For the half year, statutory revenue was $85.3 million.
The fall in share price was also probably impacted by an international sell down of tech shares around the world.