When Meta — the company formerly known as Facebook — announced its intent to transition its attention away from social media and toward the Metaverse, this massive shift in focus immediately grabbed the attention of retail investors and traders alike. Hoping to get in on the ground level of this buzzworthy new iteration of the Internet, your first instinct might be to invest in Meta or something similar. In truth, the one and only Metaverse stock your need to own for the next ten years is Matterport. Let’s talk about what Matterport does and why this matters to your investment portfolio.
Matterport =3D Spatial Mapping
Matterport is one of the most important names in the world of 3D spatial mapping tools. Currently positioned as the standard for 3D space capture technology, Matterport’s all-in-one platform allows users to create digital twin models from real-life spaces. Matterport does a lot more than just create a panoramic scan, though — it creates 3D models of spaces that are truly interactive.
What’s more, Matterport has been at it for a decade now. The company has already established an enormous base across 150 different countries and thousands of individuals ranging from everyday people to Fortune 500 companies and everyone in between. The company’s success isn’t only about its customers or its features, though — Matterport has the financials to back it up.
Matterport’s Financials Are Improving
Since going public on the New York Stock Exchange, Matterport has displayed some impressive financials for its first, second and third quarters. Most recently, Matterport saw its revenue hit $27.7 million, a 10 percent increase over its year prior quarter revenue. Matterport also hit an Annual Recurring Revenue of $62.7 million during the same quarter.
The company reported an earnings per share of -$0.20, beating analysts’ previous estimates of -$0.22 for the quarter. With revenue up 36 percent year-over-year, there’s high expectation that Matterport’s financials will continue to soar in the quarters to come.
Compounded Growth Rate Expected To Skyrocket
While its financials are impressive enough on their own, Matterport’s growth rate also says a lot about where the company is headed from here. With an average rate of just a dollar per space per month, Matterport could quite easily earn billions of dollars in annual revenue with just a fraction of the market. With a current market cap around $2 billion, analysts forecast its valuation could exceed over $100 billion over the long term.
Earlier in the year, Matterport issued a projection that saw the company’s annual revenue reaching $747 million by 2025, which represents a compound annual growth rate of 59 percent between now and then. Matterport also believes its gross margin can expand from 48 percent to 73 percent over that same stretch of time.
Matterport’s Valuation Suggests Massive Upside
Beyond its financials and growth rate, Matterport’s valuation is currently one of the company’s most alluring aspects. Based on a discounted cash flow forecast analysis, Matterport has upside potential to $29.60 per share.
Most of Matterport’s competitors are smaller start-ups right now and while it would be relatively simple for Apple or Alphabet to implement similar features to Matterport’s on iOS and Android devices, these companies simply haven’t hinted at doing anything of the sort.
Matterport’s Competitive Advantage Is Large
This fact plays directly into Matterport’s moat. Matterport’s 3D space capture technology isn’t the only tech of its kind, to be sure, but any competitors — either current or prospective — will definitely have a hard time trying to catch up to the sheer volume of Matterport’s spatial data and use cases for that spatial data.
If Matterport wants to keep up its advantage over any current or future competitors, it’s important for the company to scale quickly in order to take control over more verticals across the globe. There’s no indication that Matterport would be incapable of doing exactly that over the course of the next decade.
Pros and Cons of Matterport
With its financials, growth rate, valuation and moat addressed, let’s discuss some general pros and cons of investing in Matterport and holding it for 10 years.
- Matterport is the first major player in the world of 3D spatial mapping tools, giving the company a serious advantage in the industry that should only grow in the years to come.
- Matterport’s number of managed spaces is about 100 times more than the rest of the entire digital twin market combined.
- As the Metaverse continues to be constructed and is eventually rolled out on a major scale, Matterport will become even more in-demand than it is now.
- If Google or Apple were to enter the market of 3D space capture technology, Matterport could be in serious trouble.
- Matterport’s earnings per share is currently in the negative, which might put off some retail investors and traders — especially if it dips any lower.
The Bottom Line: The ONLY Metaverse Stock To Own For 10 Years
While investors might raise some questions about its future financials or projected growth rate in the present, demand for Matterport’s services are poised to rise significantly in the months and years to come. As it becomes more and more common to scan physical spaces and mix them with VR or AR technologies, Matterport will play an even more important role in the world of 3D spatial mapping tools. For this reason, it could be well worth investing in Matterport and holding onto it for years — it’s likely to pay off extremely well in the long run.