The company has announced a $25m equity raising with funds to be used for expanding revenue growth through higher investment in sales and marketing.
The accelerated level of investment will result in higher operating losses, Morgans notes, particularly in FY19 and FY20, but should lead to a more robust business.
Add rating maintained. Target is reduced to $1.76 from $2.02.
Sector: Technology Hardware & Equipment.
Target price is $1.76.Current Price is $1.18. Difference: $0.58 – (brackets indicate current price is over target). If CAT meets the Morgans target it will return approximately 33% (excluding dividends, fees and charges – negative figures indicate an expected loss).