Wynyard shares rise again as tech love affair continues

Brooke Bone.
Brooke Bone.
The rise in Wynyard Group's share price continued yesterday as New Zealand investors remained enamoured of the technology sector.

In 10 days, the security and intelligence software company's shares have risen more than 90%, the latest rally following the group's announcement it met its forecast sales target of $21.5 million last year.

Wynyard shares closed at $2.23, up 17.4% on the day. They listed last June at $1.10.

Milford Asset Management senior analyst Brooke Bone said Wynyard had every hallmark of being a ''very successful'' company.

In some ways, the recent share price movements were not as extreme as they seemed. In part, the share rise was a catch-up.

''There is increasing confidence in the products they sell and what they do. There is interest in the sector both here in New Zealand and in the United States. Wynyard has not participated in that so the rise is partly catch-up.''

Asked whether there was any correlation between the rise last year of accounting software company Xero and the rise of Wynyard, Mr Bone said Xero was one of the exciting stories on the NZX and exciting stories had ''momentum investors'' jumping into the market.

However, Xero did not rise in value in a straight line and Mr Bone warned technology shares could be volatile.

The small number of shares on issue made the shares illiquid, which exacerbated price movements, in some cases, he said.

The Auckland-based company, which was spun out of Jade Software last year, said annual sales rose more than 62% revenue in 2013.

It also said the board would review its 2014 and 2015 business plans and targets in the first quarter of this year, according to the statement.

Wynyard's offer document projected 2014 revenue of $27 million.

''The couple of wins they've had are obviously highly impressive,'' Craigs Investment Partners broker Greg Easton said.

''They've delivered on what they said they'd do, and that's always important for a new company.''

In November, Wynyard brought forward recruitment of new sales and services staff to manage next year's growth pipeline, adding between $1 million and $1.5 million to the forecast operating expenditure of $25 million for the 2013 calendar year.

Chief executive Craig Richardson said the number of new opportunities materially increased in the fourth quarter of 2013 and Wynyard took steps in November to build capacity to qualify and service this increased demand.

Wynyard will announce its full-year results on February 24. Mr Bone said Wynyard would not make a profit this year after investing in the new opportunities.

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