Member Info for phenomenonnick

Hopefully if they've done two this year (inside 4 months) and expect that pace to accelerate, there will be more than four acquisitions in the remaining 8 months of the year.

We shall see!

They read the RNS of 7 May!

Think you’re reading too much into that - “on or around” is absolutely standard wording; it was in (for instance) the last placing I did before BIDS, which was PIRI - see their RNS of 13 Feb. No harm in hoping for news though!

Nickel who did you short this through? I agree this might be like EVRH, but I was in them at 1p and out at between 1.2p and 6p. Missed the rise to 20p. Now back in at 4p. Would have been good to short the 20p to 4p bit.

How has no-one posted in two months? With two RNS announcements setting out what’s going to happen! And more importantly why is the share price only 25p when we get a 24p special dividend in a month’s time?!

Genuinely don’t understand why there isn’t more buzz about this stock. What’s not to like?

Yeah, could do. I hope you’re right, I’ve got a few. There do seem to be better opportunities though. I like BIDS which I’ve been in since it was KIN. And PIRI is my current favourite shell. Odd how some firms seem to have almost no following on here though. Eg OMIP - why isn’t that a screaming buy with more people talking about it than DBOX? Or PVCS which is 25p a share and pays a special dividend of 24p next month! Surely both are better places to look in the short and probably long term?

I guess the downside is that there's minimal cash on the balance sheet, and profits are low in absolute terms so will be eroded by the cost of being a plc. Management has a somewhat invidious choice - strong growth generally needs investment, and there isn't much cash for that and from OpEx it will hold back profits. Or cut costs hard to grow bottom line at the expense of growing top line, and stay relatively small and pedestrian.

I'm kind of neutral at current levels. I do like the business it's just a bit small to be public. I hope they can find a way to break out - maybe a low cost bond, convertible at a higher share price. Execute a sensible acquisition, price rises, bondholders convert, they're out of the hole.

Sorry to hear that BigJig. I did really well on this initially - bought in at 1p pre the reverse, sold gradually as they went to 6p. Missed most of the later highs. I've piled in at a bit over 4p. Feels like it ought to do well, we'll get a steer from outlook they'll surely release with the 2018 results which I guess are due any day now. They have enough cash to see this through and if there's any future in this stuff the work they've done in sorting out all the licensing has to be worth something.

No.

Yes my application was scaled back so it was clearly oversubscribed. Can't see the shares in my account yet though so don't think I can sell. May just be that I need a more expensive stockbroker lol.

Definitely think it's a very odd call if Nickel is shorting this. Whatever the bear case, there's a huge potential upside here. There are plenty of companies where the downside looks more certain. Of the ones I hold, DBOX could easily go either way as it has little cash and a poor share price performance, equally when I look at things I bailed on stuff like AXM and MDZ and, oh, a thousand others, which have no cash and don't seem to make money and could struggle to fundraise at current levels so need a placing at a lower price. Those are the ones I'd be shorting.

BIDS may not prosper, but it certainly has every chance of doing so.

Nickel you do see a few certainties with AIM placings. This surely isn’t one. The short term trading is fairly irrelevant to the bigger picture. Think Amazon in the late 90s/ early 00s. Or boo.com from the same time. This will work or not, if it works it will be huge. As an existing shareholder I was delighted to back them at the placing to help make this happen. All the best to them.

To an extent, calamari - the business also then has more cash. So you own a smaller percentage of a more valuable business.

I was in sub 3p but have been buying as they've risen - including just before the announcement about the possible placing. Personally I'd happily support a much more chunky fundraising than £3m, as long as they're bringing in the expertise to help ensure funds are spent wisely. The recent announcements suggest theyr'e doing just that. This is a global opportunity. They need to get it right. That's going to be expensive.

Arguably it isn’t price sensitive, just a part of how they’re going to meet market expectations of a chunky revenue figure.

Yup, I agree it’s a finely balanced judgment. Selling 40% at a loss and keeping the rest shows how split I am!

Wolf - I have absolutely no clue about the placing price. I assume it will be at a modest discount to market price, at the time they announce it. I do think £2m of cash isn't going to cut it, the recent results announcement included the quote "in the short term the Board intends to prioritise investment in technical developments which will place Bidstack in the best possible position to operate at significantly increased scale". That's a clear sign of ramping up spending. I'd be amazed if they break even at some point this year - indeed unlike almost every other stock I own, I'd possibly be disappointed if they did! Maintaining first mover advantage will not be cheap. I know EVRH has fallen back hugely, but I was in there sub 1p and they similarly raised enough that anyone interested in their technology knows they can't sit and wait for them to run out of cash.

I was half in at 20p and half at 8.7p, so 14.35p on average. Just sold 40% of it at 7p. Can't complain, in old money I was in at 3p and mostly 1p and out at 1.3p so did ok overall.

Will keep an eye on this one but I think it'll tread water this year. They should have raised more cash as a shell, the old loan notes always did look ropey, a point I made when the old board was trying to raise funds at the equivalent of 20p and getting accused of dilution. I'll stop shouting "I told you so" into the void at some point lol.

Yeah I assume they'll do a placing soon which may give it pause. I sold a few yesterday but still got plenty for the ride upwards, think there's a decent chance this has a lot further to go in the long term.

Meh, can't be masses of economies of scale - Mash made £100k on £400k of revenue. If ALL costs could be eliminated it's only £300k of costs.

I'm torn - having opened with a small position I paid 20p for I've piled in at 8-10p partly because I've long been a fan of the Daily Mash. But leaving them all in the bottom drawer with a high chance of months of underperformance doesn't feel wise, maybe a better strategy is to cut the losses and invest most of it elsewhere.

Yes I agree with the consensus here. I think the problem is that they didn't raise enough cash. The old Polemos loan notes seem to have been sold for next to nothing (which may well be their true value), and the placing on admission only covered the cash element of the Daily Mash purchase and most (not even all!) of the expenses. So I suspect they have absolutely nothing in the tank for acquisitions. The businesses acquired made around £600k a year between them, but there's the plc running costs to come off that. So the current share price is probably 10x profits. That feels fairly full price unless the management team can drive profit growth strongly. Maybe they can - Daily Mash felt like a labour of love more than a commercial exercise. (The app is awful, fine when it came out years ago but not sure it's ever been updated and bits keep breaking.) With no results due until much later in the year (next results are the interims to 30 June 2019 and I guess will include a load of listing costs etc so will be fairly opaque). So if it's ages for decent trading news, there's no cash for acquisitions, and the share price has halved making paper acquisitions highly dilutive, they're suddenly not in a great place.

Hopefully some of my assumptions are wrong here - if so maybe they need to spend a bit of cash on financial PR to help us all understand the potential and get the price up, so they can do acquisitions or a fundraise in a less dilutive way than would be the case at present.