Matterport’s (NASDAQ:MTTR) stock, a spatial mapping company some call a metaverse play, jumped 35% after reporting better-than-expected revenue.
Investors ignored a net loss of $58 million, 20 cents per share. They focused instead on revenue of nearly $38 million, up 38% from the same quarter a year ago. The company raised its full-year revenue guidance by $2 million to $134 million to $136 million.
Matterport came public in Feb. 2021 through a SPAC and was trading for over $27 a year ago. A 15% overnight gain, on top of another 15% gain on Nov. 10, still left it with a market capitalization of under $1 billion. Some of the gains faded as in this morning’s early trading.
What’s the Matterport?
Matterport uses 3D cameras and spatial modeling software to deliver accurate maps of real estate clients can experience and virtually fill before they rent. The result can be “real places in phony worlds,” as I wrote in February. It’s also possible Matterport came to the public market too soon, lured by last year’s cheap cash and metaverse hype.
When money was free and real estate booming, virtual spaces that were twins of real places seemed like a great idea. More recently even “tech whisperer” Cathie Wood dumped her fund’s stake, after buying a first-quarter dip that turned out to be the prelude for a bigger dip.
Matterport’s software connects with design products like Autodesk (NASDAQ:ADSK). Images can also be captured on an Apple (NASDAQ:AAPL) iPhone, the company says. In addition to commercial real estate, Matterport claims applications in retailing and construction.
Bullish analysts insist Matterport has massive potential. The company has been collecting spatial data for a decade, it has patents to protect its intellectual property, and it claims an addressable market worth $240 billion. It continues to roll out new hardware and software.
MTTR Stock: What Happens Next?
Matterport remains a long-term speculation and an expensive stock.
Wedbush, which called Matterport its “best idea” a year ago, lowered its price target from $7/share to $5 after earnings. This helped send the stock back to Earth in the minutes before Nov. 11 trade opened, to $3.30.
If you believe in Matterport’s vision, be prepared to wait for a payoff.
On the date of publication, Dana Blankenhorn held a long position in AAPL. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.