MIXT Stock Forecast 2019
The stock forecast for MiX Telematics Ltd (NYSE:MIXT) in 2019 is extremely bullish. In fact, MIXT stock could be the best-performing tech stock you’ve never heard of. Since the start of 2016, MiX Telematics’ share price has been nothing short of spectacular.
In 2016, the South Africa-based tech company’s share price advanced 50%; in 2017, it increased 107%; and in 2018, it increased a modest 23.9%.
MIXT entered 2019 trading at $15.60. And thanks to strong financials and an even stronger outlook, a 2019 forecast of $28.00—which would be a full-year gain of 79%—is well within reach.
MiX Telematics Ltd
Warren Buffett famously said he only invests in companies he understands.
MiX Telematics is one of those companies with easy-to-understand operations. Founded in 1996, it’s a leading global provider of driver safety fleet management and driver safety vehicle tracking services. The company helps customers keep track of their vehicles, drivers, and other mobile assets.
MIXT provides driver communications, collision prevention, driver identification, satellite communications, trailer tracking, fuel security, and in-vehicle cameras.
Customers that use MiX Telematics’ products and services are able to reduce their fleet sizes by 12% to 30%, their maintenance costs by 15%, their accidents by 70%, and their fuel costs by up to 15%. (Source: “Frost & Sullivan Lauds MiX Telematics’s Rise as the Leading Provider of Information and Related Services for Mobile Assets,” The Africa Report, July 5, 2016.)
The company’s products are sold in more than 120 countries. It has an installed global base of over 700,000 subscribers—and that number is growing.
MiX Telematics has a market cap of roughly $347.2 million, a forward price/earnings (P/E) ratio of 24.6, total cash of $25.6 million, and total debt of $5.8 million.
The company provides an annual dividend of 1.3%, or $0.21 per share.
MiX Telematics Ltd Stock Financials
MiX Telematics’ bullish momentum has been fueled by consistently strong financial results.
On November 1, 2018, MIXT announced its financial results for the second quarter of fiscal-year 2019, which ended September 30, 2018. (Source: “MiX Telematics Announces Financial Results for Second Quarter and First Half of Fiscal 2019,” MiX Telematics Ltd, November 1, 2018.)
Second-quarter revenue increased 20.8% year-over-year to $35.1 million. Subscription revenue was up 20.3%, at $29.7 million, while hardware and other revenue was $5.4 million, an increase of 23.7%.
Second-quarter net income came in at $3.8 million, or $0.16 per share, a 123.5% increase over the $1.7 million, or $0.08 per share, recorded in the second quarter of 2017.
Total revenue for the first half of fiscal-year 2018 was up 16.7%, at $67.4 million. Subscription revenue increased 18.4% year-over-year to $57.3 million while hardware and other revenue was up 8.3% at $10.1 million.
Year-to-date net income was $4.9 million, a 19.5% increase over the $4.1 million recorded in the first half of 2017.
“MiX reported a very strong second quarter, highlighted by our ability to exceed expectations across all key operating metrics,” said Stefan Joselowitz, CEO.
Going forward, MIXT raised its full-year guidance. The company now expects to report full-year revenue in the range of $132.3–$134.6 million, which would translate to annual revenue growth of 12.7%–14.6% over 2018.
MiX Telematics raised its full-year adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to $37.7–$39.1 million and its full-year adjusted earnings per share to $0.62–$0.65.
Mix Telematics Ltd Stock Analysis for 2018
MIXT stock’s share price was on a tear for the first half of 2018, climbing 65% to a 52-week high of $20.85 on May 14. It weathered the October stock market meltdown better than most tech companies and saw its share price soar on strong second-quarter results and improved full-year guidance.
Chart courtesy of StockCharts.com
For the first half of 2018, MiX Telematics stock traded well above its 50-day and 200-day moving averages. This was reversed in the second half of the year, but the roller-coaster ride continued in November and December.
Still, for technical traders, MIXT stock is closing in on an important inflection point. The company’s 50-day moving average is close to overtaking its 200-day moving average. This is a bullish indicator called a golden crossover. It typically portends an upward trend.
If the trading volume increases, investors could see the MIXT share price break out to $16.75 (with some resistance at $17.00 per share). Over the next 12 months, this stock is expected to be even more bullish, and could touch $18.00 per share.
Why MIXT Stock Could Reach $28 in 2019
The MiX Telematics share price should trend steadily higher in 2019 because it has everything going for it.
The company continues to report strong, double-digit quarterly revenue growth and ongoing profitability. As mentioned earlier, thanks to growing subscription revenue, MIXT has raised its full-year guidance.
Of the analysts covering MIXT, the 12-month forecast has a median target of $27.00, which would be an increase of approximately 73% from its January 2, 2019 opening price of $15.60.
If MIXT shares perform a little better than expected and reach $28.00 per share, that would represent a full-year gain of 79.4%.
Should investors consider MiX Telematics stock for the long term?
MIXT stock has been one of the top-performing tech stocks because of its rising revenue and profitability. And nothing has changed on that front. In fact, the company thinks that sunnier days are ahead in the second half of fiscal-year 2019.
The MIXT share price will benefit from its own growth story. It could also benefit from an eventual return to optimism in the tech sector. The current bearish sentiment is certainly weighing down the industry, but look for MiX Telematics to enjoy a boost once the downward pressure on tech stocks has been alleviated.