iSign Media Solutions Inc. has many risk factors to consider

Aug 30th, 2013 – Comment

The break below support at $0.20 and the retest of support at $0.18 adds another risk factor to the analysis.


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ISD LOGO

Hi Lou,

Can you comment on ISD-X .

Thank you,

Jules

 

Hey Jules,

 

Thanks for the assignment. iSign Media Solutions Inc. (ISD TSXV) provides mobile advertising solutions to, advertisers, manufacturers, retailers, and advertising agencies who are looking to engage customers at the point of sale. The company has over 5,600 digital signs in 1,400 locations. ISD is at a stage in its development where it is reporting losses on operations and is raising money through private placements to fund its growth. The firm recently announced a deal to install 6,600 screens in U.S, convenience stores further expanding their footprint.

What you want to keep in mind when examining the case for stocks like ISD is that with a market capitalization of $8.75 million it has a higher risk profile. Another factor to consider is that the average daily volume over the last three months is 92,583 shares which for a stock trading at $0.18 represents approximately $16, 666 in value. The low value of trades leads to more questions about the investment. Finally the last quarterly report filed on March 28, 2013 indicated that for the nine month period ended January 31, 2013 total revenue was $892,074. Low sales volume once again adds to the uncertainty.

An investigation of the charts will help inform my thoughts as to trend, support,and resistance related to this investment.

 

 

ISD

The three-year chart indicates that the shares have been in a downtrend since the summer of 2011. The break below support at $0.20 and the retest of support at $0.18 adds another risk factor to the analysis.

 

 

 

 

 

 

ISD2

The six-month chart highlights the top at $0.28 in May and the sell signal generated by the MACD at that time. Worth noting is the death cross that formed in July and the resistance that has come in along the downtrend line and the moving averages.

ISD is another example of a speculative stock that is trading in a higher risk environment, has a very small market capitalization, needs to raise capital to fund growth, has been reporting losses on operations, and has a thin revenue profile. Those factors plus an established downtrend and continued resistance to any advance put a caution flag on the track for investors.

Make it a profitable day and happy capitalism!

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