The iSignthis Ltd (ASX: ISX) share price was trading 27% lower today, perhaps as a result of more fallout from the Ownership Matters report.
About iSignthis Ltd
iSignthis is listed on the ASX and Frankfurt Stock Exchange. It provides remote identity verification and payment authentication combined with e-money, transactional banking, IBAN issue and payment processing capability. Its products and businesses are iSignthis Paydentity, ISXPay, UAB Baltic Banking Service and Probanx Information Systems.
There has been no material news released from iSignthis today, however, it would appear the company’s ongoing battle with critics is weighing on the share price yet again.
The matters raised by outside firms such as Ownership Matters, and disclosed in part by iSignthis to the ASX earlier this week, seem to relate to issues of corporate governance.
For example, critics have said certain performance targets for key personnel were set at $5 million in revenue during a six-month period, and that target was exceeded by just $1,347.
iSignthis challenged this by saying, “even if interest and government grants were excluded from the audited revenue figure, only Milestone C [the six-month revenue target] would have been achieved by a margin of $1,347. Milestone A would have been achieved by a margin of $2,501,347 and Milestone B would have been achieved by a margin of $1,251,347.”
Other concerns raised include “opaque” ownership structures by directors of iSignthis and “limited disclosure” about revenue increases. iSignthis says it has written to Ownership Matters seeking clarification.
Buy, Hold or Sell?
I cannot tell you for certain what’s happened, why and when regarding the matters above, so I’ll just stick to what I know about investing more generally.
From where I sit, shares of iSignthis appear to be extremely expensive. As I wrote last week, at one stage the company had less than $10 million in reported half-year revenue and yet the combined total worth of all shares in the company was over $1.5 billion. That just didn’t add up.
And even at today’s seemingly discounted share prices, I’m still not a buyer of iSignthis shares, if only for valuation reasons.
Here are 3 stocks I own in April 2020...
Amidst the COVID-19 confusion, there are some companies still growing FAST (think: online meetings through Zoom, streaming companies like Netflix and eHealth services provided by Teledoc).
While the world grapples with COVID-19, some companies are still growing rapidly. The entire cloud computing market is valued around $US210 billion but if you ask me, it seems clear as day that this market is only going to get bigger in 2020 and beyond.
That's why our top investment analyst has just identified 3 growth stocks in a net cash position, with strong competitive forces... and obvious tailwinds at their back. He owns all three of them right now!
Claim a FREE investing report on our analyst's "3 best share ideas for the cloud revolution" when you create a free Rask Australia account.
Our report is 100% free and unlocks hundreds of hours of bonus content.
Disclaimer and warning: The information on this website is general financial advice only. That means, the advice does not take into account your objectives, financial situation or needs. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. Please read our Terms of Service and Financial Services Guide before using this website.
Disclosure: At the time of publishing, Owen does not have a financial interest in any of the companies mentioned.