[Music]
Did you know that matterport stocks
recent drop was easily predicted?
But before you try to understand how a
stock's price might move - First you need
to understand about the company itself!
So let me explain to you what matterport
is all about and why this stock might be
about to become a great investment and
what needs to happen here first before
we can see a share price reversal.
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matterport is a market leading 3d
platform that lets anyone turn a
physical space into an immersive digital
twin. Matterport takes real life
physical space and transforms it into
digital twin which is a 3d model using a
combination of different types of
cameras software and applications
this technology has many uses in homes
offices factory shops even museums if
you have ever seen a 3d virtual property
tour
or a virtual museum tour
then you're already familiar with
matterport's technology.
this digital 3d model can be used in
many ways such as presenting a realistic
look at a home
that a real estate agent can use for
virtual tours that reach far more
potential buyers than a traditional open
house ($MTTR)
the applications for matterport's
technology are endless ranging from
retail construction engineering and more
with more of the physical world becoming
virtual the total addressable market for
matterport's technology is massive it's
essentially every building in every
country in the world
scans can be captured from any
compatible camera and while mataport had
focused largely on selling their own
range of cameras the advancement in
technology now means that most phones
are capable of this
thousands of companies in over 190
countries use motherboard millions of
spaces have been captured comprising
billions of square feet resulting in the
largest spatial data library in the
world which gets bigger every day
mataport
has been digitalizing the world
for a decade now with the mission of
making every building and every space
more valuable and accessible looking at
the investors presentation we can see
that matterport has a top-class
management team with highly experienced
executives coming from major global
companies such as google seagate and
ebay.
matterport has a 240 billion dollar
global total adjustable market
opportunity as properties move online
and this is calculated at a cost of one
dollar per month assuming a market
penetration of only one percent with
significant upside monetizing digital
property insights and services as high
as 1.2 trillion assuming a five dollar
per space
over the past year matterport has
achieved 116 percent growth in
subscribers although a large proportion
of these are still freemium
paid subscribers has grown at a rate of
33 percent but despite having such a low
market penetration rate the company
claims to have 6.2 million spaces under
management which is digitized
building scans and they estimate it has
100 times the amount of spaces on its
platform as the entire rest of the
market combined
matterport has a range of high
resolution camera options to suit all
environments as well as a free no cost
approach of using a decent smartphone
motor port capture
is now compatible
with about seventy four percent of all
devices
the company's plan of offering free
subscriptions is being used as a way of
capturing potential subscribers with a
view to converting these into paid
subscriptions over time which tends to
be a very good business model in order
to obtain a high level of customers
quickly and hopefully a percentage of
these will become dependent on the
service and convert into paid
subscriptions one of the major
advantages the matterport has is its
first mover advantage in a potentially
massive and largely untapped digital
reconstruction market
which is indicated clearly by the fact
that they have 100 times more digital
space than the rest of the market
combined
matterport breaks down its revenues into
four categories subscription
which is about fifty percent of sales
and management expects more than eighty
percent of revenue to be subscription
based by 2025
products account for 39
due to its pro camera but I expect this
to decrease rapidly as smartphones get
even better
with services and license solutions
making up the remaining revenue
matterport has an incredibly scalable
business model operating a freemium
model customers are drawn in with free
subscriptions then gradually transition
into paid subscribers as they recognize
the value and cost saving potential of
matterport's 3d data and this is where
the company can make most profit
subscription business
operated at about 77 gross margin during
the last quarter
indicating the potential for substantial
profitability growth as the company
continues to scale its subscriber base
and transition away from product based
sales such as cameras which have very
little margin
the subscription-based model provides a
recurring revenue stream which is great
to see and offers increased visibility
into future revenue streams matterport
has seen a 29x increase in subscribers
since 2018.
cushman and wakefield one of the world's
largest commercial real estate companies
increased their spend by 26 fold
while erickson increased their spin by
60 in just one year in fact mataport's
customers include 13 of the fortune 1000
so the potential is there to turn these
customers into paid subscribers and a
recurring revenue source
this is a very good article on seeking
alpha that I highly recommend having a
read of this
matterport bridging the gap between
reality and the metaverse looking at the
recent acquisition of inview the
partnership with midland holdings how
the chip shortages have affected the
camera sales and how this can be offset
by the increases in subscription fees as
more android smartphone users download
its newly launched app matterport for
android so matterport came to the
forefront of everyone's attention in
2021 when facebook announced its plans
for the metaverse a collaboration was
announced between the two companies in
2021 and 1k of 3d digital spaces have
been released to train aI systems in the
virtual worlds based on physical spaces
in the real world in addition with the
recent release of its app matterport for
android we can expect more to buy into
the subscription service given the
convenience of a smartphone 3d capture
and the multiple benefits digital twins
have to offer
in january matterport acquired in view
and as a result matterport will now be
able to develop its next generation
spatial data analytics platform that
provides powerful machine learning
capabilities
and in views advanced technology and
specialized team to strengthen the
matterport data platform and more
recently
manaport announced a partnership with
midland holdings one of the leading real
estate brokerages matterport's digital
twin technology would allow midlands
customers to view buy and rent
properties without the need to be
physically present think of the
possibilities for this customers can now
virtually tour the bedrooms kitchen
living room spaces of any number of
properties but this also offers a
long-term corporate partner in china's
massive property market however the most
exciting point of this partnership is
the possibility to virtually furnish or
stage its properties
allowing customers to more easily
visualize how an empty space can be used
customers can purchase the furniture
that they see on a property through a
virtual marketplace with just a single
click
many retailers such as nike set up
virtual stores selling virtual goods in
the metaverse and I feel that this is
more a case of when than if or whether
the metaverse will be a huge success and
matterport will be bridging the virtual
and physical worlds giving matterport
limitless potential in the future
metaphors application reason why this
company divides opinions so much is the
company's potential for a major role in
the metaverse
of course anyone who thinks the
metaphors is a lot of bs
will not see the potential here and even
large amounts of those who think the
metaverse will be big still don't see
the potential
take a moment
search google images for the metaverse
what do you find lots of images of a
world that looks very computeristic
the image that most people have
of the metaverse
is like that of a ps2 game from 20 years
ago
do you really think that this is what
mark zuckerberg has in mind when he
rebranded facebook as meta
even computer games don't look like this
anymore
gaming has evolved so much
that many games now look very real at
first glance
this is where mataport comes in
why would you want
a metaverse that looks like this when
you can have a metaverse that looks more
like this the real vision for the
metaverse
is of a world that is almost real
almost like a matrix type of world
for example this article on nasdaq.com
discusses this brilliantly
check out the link in the description
below is australia a place you've always
wanted to visit in the metaverse you
could explore the australian outback
more easily than you can get into an
outback steakhouse in your hometown you
could see the sydney opera house
the street art on jose's lane in
melbourne then stroll
the swan river in perth all with zero
travel time
several sites like these are already
captured as matapor digital twins from
there the web 3 metaverse incentivizes
matterport service partners to map out
all of these major cities and
destinations
this is what the metaverse will be like
and realistic spaces were exactly the
vision mark zuckerberg presented at his
big murder verse event back in october
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on wednesday after market close
matterport announced full year 2021
results in this they highlighted total
subscribers increased 98
subscription revenue rules 47
recurring revenue grew 66 million but a
sizable loss per share
relentless innovation is the norm of
matterport and with new products like
matterport access and matterport for
android we are racing to bring precision
3d capture and digital twins to everyone
in the built world looking forward the
physical world is going digital
every industry on every continent is
embracing digitization
and I am more confident than ever about
the company's outlook for 2022 and the
decade ahead some management are looking
to the near term
but this comment shows me that it is the
long-term plan that is of utmost
importance the goal here is long-term
before I look at the guidance for the
company for 2022 which is a reason for
the sharp drop in share price since
wednesday first I want to look at the
actual figures
we can see that matterport have total
assets of 719 million and total
liabilities of 451 million this gives
matterport an asset to liability ratio
of about 1.5 to 1.
the assets are mainly
highly liquid acid and a huge portion of
liabilities is this earn out liability
this is subject to re-measurement but
without this the asset to liability
ratio would be closer to ten to one
which is fantastic to see for any
company
and the shareholder equity would be
closer to 650 million as opposed to the
current
268 million
the current share price puts matterport
at a market cap of just over 1.7 billion
looking at the income statement we can
see that matterport has revenue of 111
million for the year showing solid
revenue growth and a really good gross
profit we can see clearly here the shift
towards the subscription side of the
business with subscriptions up nearly 50
percent
while product sales have actually
declined but this is a good thing
subscriptions are what will eventually
drive profits with a margin of about 75
percent while products have much lower
margins however sizable operating losses
mean that losses from operation and a
very large net loss of 338 million for
the year
but this is very misleading
such a large portion of this loss is
because of this
changes in fair value of warrants and
earned liability
now this is something that I warned of
last month over on the patreon where i
wrote in the next earnings report for
the period
the share price was about twenty dollars
once more I expect a sizable loss on
change of fair value
although matterport has dropped close to
eighty percent of its value I feel that
this could drop more over the next few
weeks and I think that somewhere between
five dollars and seven dollars will be a
very good entry point
I do feel that the stock will begin to
turn upwards
before the release of the q1 2022 report
so keep an eye on that
I wrote this for the patreon group back
on january 28th so what exactly is this
well as I said a moment ago this is
re-measurable if the share price rises
then this liability gets bigger and its
impact gets bigger but if the share
price falls this liability gets smaller
looking at the notes to the accounts the
earn out shares can be activated in
tranches of 3.9 million shares
from 13 up to 25 dollars because the
share price was quite high on december
31st this is the reason for this big
liability
however given the current share price is
so low that none of these are not shares
would ever be activated I fully expect
that the next earnings report in may
will show a huge shift in the profit and
loss for matterport and with increased
revenue and margins I expect this to be
a time when matterport bounces back very
strong the q1 earnings report will also
include a balance sheet greatly boosted
by the recent redemption of all the
companies
warrants at 1150 giving proceeds of over
104 million dollars meaning that no
public warrants remain outstanding
looking at market beat we can see the
matterport is currently at the bottom of
its 50-day range and 52-week range after
hitting its 52-week low earlier this
week this shows the matterport has
dropped about 85 percent of its value
recently and is currently just
1.6 billion
with institutional ownership now up to
33 percent this is a big increase from
26 percent at the time of my previous
video a few weeks ago and we can see
here significant buying in the second
half of 2021.
the most heavily invested institutions
are morgan stanley
wafra
and qualcomm who are one of the world's
largest companies in the semiconductor
industry
and looking at the most recent data
available on fintel
the short interest days to cover is 1.73
while the short float is now at 14
the analyst price target consensus is 16
the most recent ratings and price
targets were set this week by credit
suisse analyst john walsh who has set a
buy rating but lowered his price target
again to twenty three dollars
which is more than two hundred percent
upside from the current price
looking at tip ranks we can see that
john walsh is a five-star analyst with a
64 success rate
while the other recent price target is
set by wed bush analyst daniel eaves who
is also a five-star analyst according to
tip ranks with a 63 success rate but he
has slashed his price target
from 38 down to just ten dollars
but even this price represents
significant upside from the current
price
but what do you think of where
matterport is right now
given that I was right about the huge
liability
and that matterport was going to drop
after earnings were released do you
think that I am right that mataport
should start seeing a reversal in
mid-2022 or do you think that this will
drop even further
drop a comment down below and let me
know what you think subscribe to the
channel and i'll catch you in the next
one