By Steve Moore | Tuesday 9 May 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
On MySQUAR (MYSQ), Cynical Bear has previously warned of rampers and pumpers being out in force. Having commenced May at sub 1.3p, the shares are currently more than 60% higher on the day, at above 4.5p, on the back of a “Significant Revenue Milestone and Product Update” announcement. Hmmm…
The update includes that “the Myanmar-language social media, entertainment and payments platform… is pleased to announce that… average daily revenue reached $5,000 during the first week of May 2017, an increase from an average of approximately $3,900 in April 2017… achieved due to both the integration with Telenor Myanmar's carrier billing services and recent product releases”.
It is added that “revenue generated from premium content in MyChat and other apps is not yet material to the business, but is expected to underpin future growth” and “anticipate healthy future revenue growth given the multiple revenue streams from existing products as they gain in popularity over time in conjunction with the release of new products and new product features in the pipeline”.
So a focus on revenue, and particularly “expected” and ‘anticipated’ future revenue. In terms of the “product update” part; “On 5 May the company released an updated version of its VoIP service, CallHome, which has been expanded to target a larger regional base, including India and Pakistan, for example. By the end of May, the company expects to release a new hard core game called My Hero - Bo Lattae (as a substitute for WuKong which has been delayed due to unexpected software localisation issues with the game licensor) and an updated version of MyChat that includes a dating feature where users have to pay to chat”.
So the use there of the likes of “expanded” and “new hard core game” rather than any financial insight. This is ramparoonie type stuff – following the classic pump and dump only last month.
It also all suggests the March interims stated ‘focus’ of progressing to operating on a cash flow breakeven basis remains some way away and that there is nothing concrete here which justifies the recent share price spike. I reiterate Cynical’s previous caution.
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