In the material world earnings can matter dearly. But on Wall Street, perception can matter nearly as much, if not more. And today both are working against Matterport’s (NASDAQ:MTTR) MTTR stock.
But could a more bullish experience be around the corner for investors?
Let’s look at what’s happening off and on the MTTR price chart, then offer a risk-aligned determination aligned with those findings.
Wall Street had its happy face on Tuesday. Led by the large-cap, tech-heavy Nasdaq investors bid the index up more than 2% on the session with more burly gains in top stocks Microsoft (NASDAQ:MSFT), Nvidia (NASDAQ:NVDA) and Tesla (NASDAQ:TSLA).
But metaverse play and spatial 3D outfit Matterport was mostly left to its own devices and alone in a world of indifference.
MTTR Stock in the Doghouse
On the session MTTR stock eked out a barely mentionable 17 cents or just over 2.50% for a more positive-sounding, but misleading outcome.
Maybe worse and definitely for some Matterport investors, the price action remains world’s removed from December’s all-time-high of $37.60 by more than 80%.
To be fair, part of the doghouse MTTR stock finds itself in is of its own doing.
Red ink has grown hand-over-fist the past year. Also, as InvestorPlace’s Mark Hake notes, Matterport’s revenue “run-rate” of $108 million warns of slower sales growth.
And those line items did get some traction when they were released. Following February’s earnings report investors slammed MTTR shares by 17% to all-time-lows.
Perception Does Matter
But let’s not forget the importance of perception and its role that’s worked to both the betterment and detriment of Matterport investors.
During last year’s fourth quarter, bullish perception played a key role of certain benefit to Matterport investors as shares doubled in price in less than six weeks.
Of late and right now, it’s been a forceful bearish opinion that’s wiped out the entirety of the gains and more, attached to MTTR’s metaverse rallying cry.
But don’t expect that dogged and dour determination to last either.
For one, Matterport’s SPAC gave it the cash it needs to continue operationally for the next couple years.
That may not sound like much of a lifeline with MTTR burning through reserves at the moment. But bearish perception makes the challenge appear much worse than it is.
A Lot Can Happen
Consider this, think of where you were two years ago. Yup, holed up amid lockdown orders with the end of days hanging over our heads. A lot can happen in two years, and it doesn’t have to end badly.
Also, overall demand for MTTR’s geospatial technology is growing smartly with more than 6.2 million “Spaces Under Management.” And mind you, revenues are increasing despite some quarter-to-quarter unevenness.
Further and optimistically, today’s fearful market conditions could easily be in the rearview mirror and replaced by new highs before a potential capital raise might be needed. And that would make any secondaries or bond offerings, if needed, much easier to secure.
Now let’s talk price, or rather value. Coupled with Wall Street’s current program of fear and loathing, MTTR shares trade for just 13x sales.
Similar to MTTR stock’s cash position that may sound risky. But no one is comparing Matterport to Costco (NASDAQ:COST). And for a growth narrative valued at just $1.65 billion, that kind of challenge can be navigated.
Not only that, should a forecasted multi-year compounded annual growth rate of more than 44% turn into a reality for the metaverse, let’s just say the real risk is not being on board with MTTR stock.
And if you’re still anxious about Matterport shares? Well, maybe Coca-Cola (NYSE:KO) and a game of shuffleboard is more your thing.
MTTR Stock Weekly Price Chart
Source: Charts by TradingView
Technically, and as bad as a 17% post-earnings reaction loss to new lows sounds, the only real noise comes from unusually heavy volume heading into and through the quarterly announcement.
You can almost hear the towels of MTTR’s apish bulls being tossed along with the record-breaking activity.
But while Matterport’s meme stock base has said goodbye to shares and shows zero interest in chatting up the stock on WallStreetBets, other bulls should now see MTTR as a good buy.
Today, with MTTR stock quietly consolidating in a weekly lateral pattern and stochastics oversold and bullishly positioned — Matterport makes for an interesting longer-term, speculative purchase, both off and on the price chart, with a much improved, risk-to-reward profile.
On the date of publication, Chris Tyler holds long positions in Matterport (MTTR) (either directly or indirectly). The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
