More Life Left In Life360

Small Caps | May 14 2024

Life360 has doubled in share price since its March earnings result, but brokers believe further re-rating is still on the cards.

-Life360 beats on earnings
-Record quarter for monthly active users
-Further re-rating expected
-US listing pending

By Greg Peel

Life360 ((360)) is a California-based, ASX-listed company that operates a technology platform to locate people, pets, and objects in North America and internationally, plus some more extensive services, via a range of free and pay-for apps.

Using Life360’s technology, one can keep track of the whereabouts of a young child, a dotty grandmother, a wayward dog, and a mobile phone, for example.

The company offers “paying circles” which allow family members to collectively keep track of whomever or whatever they wish to.

When Life360 reported second half earnings at the beginning of March, the share price quickly jumped 50%. Aside from posting beats on revenues and earnings, the company announced a move into advertising (to its non-paying database) that brokers saw as the main highlight.

Since then, the share price has now as good as doubled. Last Friday, the company provided a quarterly update which led to only a muted share price response, given the key metrics had already been pre-reported.

Conservative Guidance

Life360’s quarterly update showed a slight miss on consensus revenue forecasts, but a beat on adjusted earnings. Growth in monthly active users and paying circles were a record in the quarter.

Management noted it is “seeing that higher growth level continuing” with regards to the late quarter rise in monthly active users and paying circles.

Despite the strong result, 2024 guidance was left unchanged, even though management highlighted this year’s result will be more second half-weighted than usual due to the ramp-up in advertising revenue over the year. 

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