Share price hits record as software firm says its strategy to expand in the Middle East is working as planned.
Shares in Wynyard Group soared to a new record on optimism about the global growth prospects for the company's intelligence software.
Wynyard shares jumped 11 percent to $1.48, adding to their 12 percent rise yesterday after the Auckland-based company announced it had gained the United Arab Emirates money exchange GCC Exchange as a client for its anti-money laundering software.
Wynyard estimates the size of its potential global market has grown from US$300 million in 2011 to US$5.3 billion in 2013 as it added government intelligence software to its suite of products targeting financial crime. The latest contract adds to overseas deals the company signed with the Thai Customs Department, Manayer Marketing Management and Galadari Brothers in the past two months.
"The market is now starting to price in the large amount of contracts that they have been winning over the last few months," said Mark Warminger, who holds the stock among the $710 million of New Zealand equities he helps manage at Milford Asset Management.
"The anti-money laundering contract that they won in the UAE yesterday was a positive for them and I understand the pipeline of new contracts is very strong."
Milford bought Wynyard shares in the company's initial public offering for $1.15 apiece in July and added to its holding when the stock dipped to about $1.05 last month.
Warminger expects the price could appreciate to as much as $2 this year as investors factor in the company's growth prospects over the next two years.
"The outlook for Wynyard is very strong," he said. "They have got an absolutely fantastic product that is relevant to many law enforcement and government agencies around the world and the company is in very early days of selling this product around the world so I think they have got an incredibly strong future ahead of them."
Wynyard, which was spun out of closely held Jade Software, said in November it was on track to meet its annual revenue forecast of $21.5 million after posting first-half sales of $10.3 million.
"The world is their oyster at the moment," said Milford's Warminger. "The places where they have got exposure is still incredibly small compared to the overall pie that they could potentially win so it is really still in its infancy."
Wynyard shares are the top performer on the New Zealand exchange today, giving the company a value of $136 million.