HYO in their former life were BMC Media that was one of the market darlings during the Nasdaq Bubble. The only real reminder of those days is the flow of tax loss selling from those who may be owed in excess of $50.00 per share remembering every ten shares were consolidated into one.
Reasons why HYO is worthy of further research
* Management has been cleaned out with Stephen Porges filling the Chairman's role. Stephen was recently appointed as MD of PXL and has already proven his ability with a major TB agreement signed with FIND (funded by Bill and Melinda Gates). Richard Lord and Joe Calavassey have extensive experience through ISMC and are industry veterans
* HYO is involved in the digital advertising sector and its client list includes the NRMA, Ford, Coca-Cola, Canon, Foxtel and Telstra.
* There have been two major announcements in recent weeks with key agreements signed with Westpac Banking Corporation and IBM. The IBM agreement is significant as both companies will work together to market software for State and Federal Governments.
* The company is already announcing its intentions with some option agreements over smaller operators on low EBIT multiples. The aim is to identify synergistic businesses that have the capacity to provide HYO with a more certain cash flow
* There has been considerable tax related and Ex Director selling of late. The sell side now appears to be thinning, however from recent trading activity the share price weakness still may have some time to run
* From media reports and a speech from Murdoch it is apparent that digitial advertising and services is a growth story and the challenge for HYO is to expand on their blue chip client list.
* The register is largely dominated by institutional investors and this can be a double edged sword as some may have cleaned out their positions prior to June 30 (still some time for further pressure). On the flip side any significant buying would be the major catalyst for a re-rating.
www.hyrolimited.com has further details on the company. Not a stock for traders as the market depth at times prevents any entries/exits on volume.
The key will be how the stock performs in the new financial year as the period post ISMC aquisition has been a harrowing experience for shareholders and this company must be regarded as a very high risk-high reward situation.
My personal and family holding in HYO is 370,000 shares purchased between 6c and 11c.
HYO Price at posting:
0.0¢ Sentiment: None Disclosure: Held
