Dec 7, 2017 Equity Story put this on as Penny Punt, their highest risk category with this analysis: Definitely took some time to find its feet but now post-cap raising (@14c) it has enough cash to grow business for a few quarters before going back to shareholders. One of the more exciting penny punts in our opinion due to exceptionally strong growth at client numbers and revenues. Has been flying under the radar but it is starting to gain momentum. We also love the product and we see that so do others.
Equity Story commented on 9SP's recent report: The quarterly was positive from our point of view with revenues growing and cashburn reducing, however it is still a quarter to quarter and while we do like the story, if they execute successfully and get through the growing pains period this could be big. We do expect another capital raising in the near term but overall we are still positive on the story and fundamentals are enticing.
Equity Story responded to my question about this stock after Suncorp was released from their contract.
Q. Are you shaken in your opinion (of 9SP) post fall-through of Suncorp contract
A. No, while it was disappointing from a client point of view to see a good name like Suncorp go, from a business point of view if something is not working than one needs to make the hard decision and save the cash for other contracts that are working. It is definitely still a high risk company with cashflows in the negative, but we can see the big picture and if successful it could be huge, as the product and service is excellent. It will be tough times ahead in the short term that’s a given as they need to raise more cash for starters.
MY CONCLUSION;
WHEN YOU BUY SHARES BE CLEAR AS TO THE LEVEL OF RISK INVOLVED AND THE POSSIBLE AMOUNT OF TIME YOU MAY NEED TO HOLD THEM, ESPECIALLY IF YOU ARE INTERESTED IN SHORT TERM TRADING.
ONLY BUY SHARES IN COMPANIES YOU WOULDN'T MIND GETTING STUCK WITH, IF THEY DO A DIP.
9SP Price at posting:
5.0¢ Sentiment: Hold Disclosure: Held