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Proxama – new agreement announcements now being seen through?

By Steve Moore | Monday 17 July 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.

Proxama (PROX) has announced an “important” partnership agreement with Rail Delivery Group, a group which brings together train operators and Network Rail. The shares have currently though responded to see them amongst the biggest fallers on the day…

The agreement is to embed Proxama's technology into Rail Delivery Group’s national rail enquiries app, with it noted that the launch of the iOS such app this month “will grow the company's audience from the 2.7 million reported in May 2017 to over 3.8 million consumers. We expect the launch of Android to follow later in the year” and that “not only is it a fantastic brand to be working with, but it helps us to further establish our monetisable audience from which to base data products. Our mobile location and intelligence business is seeing increasing demand for our services”.

It is also noted that “the agreement follows the company's announcement on Friday 30th June transitioning the focus of the company from a mobile proximity marketing business to a mobile location data and intelligence business”.

However, this attempted transition comes with the also-then released results being dire and the company needing and currently trying to get away a confetti issuance extraordinaire. It followed this last week with a “significant” contract renewal – which saw the shares on the top gainers list. However, I pointed out the lack of financial information and the useful timing to announce some ‘positive’ news – and the same applies with this latest announcement.

This time though, the encouraging words (as opposed to hard numbers) approach looks to have been seen through somewhat – and, prior to the next (half-year) results and clear financial translation of the stated “increasing demand” and “monetisable audience”, I retain this as a bargepole stock.

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