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I bet you it's a lot more than half that have speeds less than or equal to 6 Mbps. Average is different from median, which splits the sample in half.
Be fearful when others are greedy and greedy when others are fearful. Now is the time to buy. The company is now valued based only on PlayMPE revenue. The hype and value due to Clipstream is gone. The current valuation is based on some success for Clipstream at some point in the not too distant future but that's it.
Since the company isn't profitable right now because all profits are going back to finance Clipstream, I'll use revenue for valuation. The company is valued at a little over 5x revenue which is basically all PlayMPE. A fraction of a fraction of Clipstream's market would mean a valuation that's many multiples of today's price. If we assume Clipstream becomes a niche product and takes 1% market share of the $6 billion market, that's $60 mil and, say, $4 mil from PlayMPE. At today's valuation, that would be a market cap of $320 mil and a share price of $6+ (A gain of over 1500%). Even if that takes a couple of years, that's a massive gain that few investments can match or come close to, plus a good portion of that would happen once Clipstream generates any meaningful revenue to hold us over until more market penetration.
If Clipstream has market share that is anywhere close to that of PlayMPE, that would be $600 mil in revenue, $3b market cap and a share price of over $50, again based on today's valuation. That's a whole different ball game.
Those who bought during the hype are obviously at huge losses and, unfortunately, can't celebrate any profits until some meaningful revenue from Clipstream or unless they averaged down a few times.
The contract renewal with Universal should not be a problem in my opinion. If they didn't like PlayMPE, why would they have renewed it last time to begin with and increase dependence on it and therefore costs associated with going back? Negotiating a much lower price like last time is unlikely in my opinion because a) DSNY is in a stronger negotiating position now with more contracts, even if Universal is still a huge customer, b) Universal is in a weaker negotiating position now that they're a lot more dependant on it and c) if they thought they could have got a lower price, why didn't they try that last time while they were in a better position and DSNY was in a weaker position, instead of agreeing to pay more for the whole duration of the current contract?
The only risk now is complete and total failure of Clipstream which I think is nearly impossible. It has clear advantages over other solutions so even if there are any disadvantages in quality or bandwidth, it will be valuable to some and will generate revenue. Like I said, even if it is a niche product, there are huge gains to be made. Even if Clipstream fails, PlayMPE can support the company so 100% loss of investment is impossible. At this price point, the loss, if Clipstream completely fails (which is extremely unlikely), is probably in the 20%-30% retiring which, while significant, is completely dwarfed by the potential upside.
I sold my position a few weeks ago when the share price was about 20 cents higher. I believe in the products but thought the price will go down much further before it goes back up so I took a gamble and it paid off. It does seem like we have seen the bottom here (although it appeared that way a few times this year). I re-entered my position, though, so here's hoping this really is the bottom.
As I suspected, the drop yesterday was due to no fundamental reason and it is bouncing back today. We very well may have seen the bottom here!
I suspect it's because of no positive reaction to the earnings report. A lot of people were probably waiting/hoping for the report to drive the pps up. When the didn't happen, people sold. I'm sure it wasn't due to anything negative in the report that someone picked up on because it wasn't doing too bad (relative to close) the first hour or so and then it plummeted.
Thanks BlueSkyMining, I didn't know that. Still, they can buy right after which Steve did the last quarter and the results announcement should be 3-4 weeks from now so I imagine they know what the announcement will look like. If they are expecting another quiet quarter, they would wait to buy until after.
I think third quarter results should be much better than the last. Steve and the board of directors have seen how the last quarter results impacted price. They know that if revenue is stagnant or lower and/or no good news from Clipstream, price will drop even lower. The offer to board of directors was at $0.96 and the price stayed under $0.90 last week so they already bought at a ~ 7% loss. If they were expecting the next quarter results to be similar, they would be expecting another sell off and even more losses.
They probably know by now how the quarter results will look. If they don't look too good, they would be much better off waiting until after the announcement, regardless of motive. If they are buying to support share price, buying before the quarter results announcement will do nothing to support the price and prevent a sell off. If they are buying to invest, they would get much better returns if they wait until after the results. Unless they are absolutely terrible investors or they have no idea how the quarter results will look (either is unlikely IMO), we can expect some good news in the pipeline or a good increase in revenue.
I share your frustration because of the lack of solid good news over the last few months but between the board and Steve, they have bought nearly $400k worth of shares over the last couple of months. There has to be something coming.
All pre-revenue companies that I have seen issue additional shares to raise money priced said shares at a discount, presumably (IMO) to get volume. Otherwise, it would take too long to raise the needed capital at what may be a critical/strategic time. If the shares were issued at yesterday's closing price of 13 and daily volume didn't move much, it would take roughly 20 trading days to move all shares.
The new pps has to be discounted to provide better value and attract investors. The downside to this is the temporary selloff. The upside is the opportunity to increase a position at a bargain price. There is, no doubt, some uncertainty as to whether or not the lower priced shares are due to weaker fundamentals but based on all the recent product announcements, I think it is a safe assumption that that revenues are at least better than last quarter and pps will move back up.
I think the consensus is still the same. The company has great products along with IP protection but revenue and, consequently, pps do not reflect that. Shares are a bargain at this price level but if the products don't get the traction they deserve, the value of the company will not materialize in share price unless it is bought out.
I think it is fair though. The underlying problem is the lack of revenue growth or a guarantee of revenue growth in the future such as a major deal. I believe market cap could be higher if the stock were traded on NASDAQ because the price wouldn't be affected so strongly by shorts (I have noticed an increase in short volume following almost every day the stock rallies up). Nevertheless, if revenue increased significantly, shorts wouldn't be able to hold the price down.
I think there is only one question to answer. Is management to blame for the stagnant revenue or users are simply taking their time doing their DD on switching to Clipstream? Are they hiring sales staff and opening a sales office to find users or meet demand that they know will come once the logistics are done? Steve said that the bigger sales are a three to five months sales cycle and they have already started. Considering that the launch was in December, 3-5 months means an announcement should be just around the corner.
I think it's easy (and many people would like) to blame management but we don't know for sure if they are at fault and to those people's dismay, there is no proof that management is a problem. To my (and other interested investors') dismay, there is no proof that management isn't a problem either. There clearly are reasons to believe either way but it's not clear cut IMO. I'll just have to continue the waiting game for (hopefully only) a little longer.
Date of second quarter earnings release announced. This should be good.
http://www.prnewswire.com/news-releases/destiny-media-technologies-schedules-second-quarter-fiscal-2014-earnings-release-and-conference-call-253547841.html
Yea, certainly good news. A set marketing plan with a large target audience. Hopefully, it's one announcement of many to come over the next month or so.
DD and testing takes time. I work in a private, small regional company of 30 people. We rely on a free software for a certain service that we provide and were all very excited when we found out a newer version is available but it took us 2 years to start using the newer version across the board (which is still free).
We first used it with one project despite having 3 on the go and the new version is superior in every way. It takes time to train, test and gain feedback from those who use the software internally. If there are potential customers that have been interested for a while but couldn't take the finished product and test it, then there is still the evaluation period.
I don't know anything about how the music industry works but business is business. The big labels have to make sure they got their bases covered and their bottom line is not affected before they sign a deal that changes how they do business.
Well said!
I agree but it seems to me that fear is prevailing right now, not senses. That's why I expect prices to move up considerably with any major announcement. Good news will give confidence to investors and the current and future value of PlayMPE will be reflected in the share price, let alone the value of Clipstream.
Fear is a huge share price mover and I believe that people aren't confident in the stock because of future uncertainties, namely Clipstream and up listing.
The December launch was a soft launch to get feedback. I believe they didn't start actively marketing it until mid-late January.
I don't think shorts are what's holding the price down. Uncertainty is and shorts, for some reason, are betting that it will to down even further despite strong fundamentals. The price has gone down significantly in the last few months and presumably, some people lost money. People are waiting for solid future plans and proof of Clipstream gaining traction before they bet on future value again like they did last year. Plus, the fear of the reverse split and what its impact may be on market cap is hanging over the stock. Once a confirmation about the reverse split and news about Clipstream are announced, the stock will trade much higher. Like others have said, those of us who are patient will be rewarded although I would hardly call it patience unless you are a trader. Building value takes time and Clipstream was just officially launched a few weeks ago.
Good post. I agree, they certainly will. Another benefit besides the work they will put in is their acceptance of the options as part of the compensation/fees. A group with that much experience finding value in buy options at 1.70 is bound to provide some assurance to investors once the stock starts gaining positive momentum.
Market cap is a better question, considering the possibility of a reverse split. It's hard to say where the stock will be in a month or two but I expect market cap to be above 100M before the end of the year.
The stock is oversold right now and a lot of people who think the company has potential but aren't confident are probably watching it and many may have recently sold at a loss. I have a theory that may be out to lunch but here it is: Destiny isn't announcing a lot of details on purpose and giving us only indicators of the company's progress. This way they keep the price from going up but the indicators keep it from plunging and the stock is oversold.
As we all know, the company wants to up list to NASDAQ. During the CC though, they said they will only do a reverse split if it is necessary and will see where the stock's price will be. Picture this scenario: the stock is oversold and the company announces solid progress or a major deal and that they are only a step away from NASDAQ (I.e min price). Those who are watching the stock and/or recently sold will jump in and buy back and drive the price up. shorts will buy to cover their positions and drive the price up. Momentum buyers will jump in and drive the price even higher. If all this happens and then min price for NASDAQ listing is achieved and maintained, the stock gets up listed without a split, which will drive the stock's price even higher.
If the stock isn't oversold, the above may not be possible because the impact of good news won't be as significant. The good news IMO is that whether this is done on purpose or not, the stock is oversold and I expect any major announcement to drive the prices way up.