I’m always on the lookout for high-growth stocks that have been performing well recently. So when a friend flagged up the performance of the Accesso Technology (LSE:ACSO) share price, I was intrigued. It has a very impressive percentage return over the past year, up around 220%. It also operates in the technology sector, which contains other high-performing companies. So is Accesso worth buying?
The story until now
Accesso is a company that isn’t that well known. It’s an AIM-listed stock that uses tech solutions with regards to virtual queuing, ticketing, distribution and even Covid-19. Over the past decade, it has purchased several smaller companies that fit in with the operations in order to obtain better levels of efficiency.
For example, in 2017 the company bought The Experience Engine. This ties in with the ability for retailers to engage with their clients at different stages of the customer journey, via mobile apps and other electronic devices.
Up until that point in 2017, the Accesso share price had been performing strongly. The technology and software solutions worked well, and the acquisitions were approved of. Unfortunately, in late 2018 the share price crashed from 2,930p down to 1,450p at the end of December, and continued to tumble into 2019.
One reason for this was a failed acquisition that ended up costing $1.7m in professional fees. Another reason was that results struggled to keep up with expectations. As mentioned at the start, tech businesses can achieve impressive growth rates, but when this slows down, some investors get overly worried.
My outlook for the Accesso share price
The bottom line is that the Accesso share price continued to trend lower over 2019. It was also hit (as most stocks were) by the market crash in Q1 2020. But from the lows of sub-200p, the past year has seen a reversal upwards. Yet at levels just above 700p, it’s a far cry from those 2018 prices.
Unfortunately, I don’t see too much to really get me excited for the outlook of Accesso. Group revenue for 2020 came in at $56.1m, in comparison to the 2019 figure of $117.2m. The loss was smaller than the previous year, but it still returned a loss in both years, which isn’t something to write home about.
I think investors have looked beyond those results during the 220% rally. Firstly, the 12-month period takes in the time just after the lows from the stock market crash. So I could argue it’s a more generous return as the period starts almost at the lows.
Secondly, I think investors are caught up with the optimism about the reopening of the economy later this year. The Accesso share price has rallied (logically) on the assumption that travel, tourism, ticketed events and other social gatherings will increase. I think this is now priced into the stock. Thus, I struggle to see much further upside at the moment.
I’m happy to be proved wrong, but I don’t see any compelling reason for me to jump in and buy right now. As a result, I’m staying away, and will look for opportunities elsewhere.
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jonathansmith1 has no position in any of the shares mentioned. The Motley Fool UK has recommended Accesso Technology. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.