Supply@ME Capital (LON: SYME) has developed an alternative and innovative platform focused on facilitating inventory monetisation transactions which can enable a wide range of manufacturing and trading businesses to improve their working capital position and also provide a new asset class to investors.
The service model is managed by an innovative platform that matches funders, through a securitisation scheme, and companies across the world.
The UK-based company, which now has teams based in Italy, UK and Singapore, was founded in 2000 but first started trading on the London Stock Exchange in March 2020 following a reverse takeover. Last July, Supply@ME Capital completed the acquisition of TradeFlow Capital Management – a fintech company focusing on bulk-commodities trade enablement for SMEs.
Supply@ME Capital’s recent share price action
The Supply@ME Capital share price has made a steady recovery in the past few days as retail and institutional investors buy the company’s dip. Over the past five trading days, the stock has experienced a 30% price increase, reflecting the promising news surrounding the company’s operational growth prospects.
Supply@ME Capital’s share price rise leaves it trading at 0.089p, which is still approximately 90% below its all-time high. As a result, the company’s total market capitalisation has dropped to just over £35 million.
The long-term negative price action that Supply@ME Capital has suffered, which includes being down over 50% so far in 2022, is largely due to its poor financial record over the past year. The company’s semi-annual financial results have revealed consistent negative net income and operating income figures, whilst revenues have been falling. In its interim results for the six months ended June 2021 for example, Supply@ME Capital had a negative net income of almost £1 million and its revenue for that period stood at only £135,000.
What do the investment prospects of Supply@ME Capital look like?
Supply@ME Capital expects to generate consolidated revenue of around £3.8 million – £4.9 million by the end of 2022, based on proposed fees charged by the group. If such predictions are achieved, the company will be in an extremely healthy financial position relative to its current economic status.
Supply@ME Capital is also proving to be popular with investment banks (such as Negma and ARC Group, as their involvement shows). The company continues to receive monetary backing from these institutions and can therefore continue to finance its operations on a relatively large scale.
As with all companies, however, it is extremely important to consider the risks associated with Supply@ME Capital and how this may impact its operational and financial success in the coming months moving forward. Firstly, as we have previously alluded to, Supply@ME Capital is heavily reliant on third-party investors, which could spark some volatility in the future as these investors could pull out at any moment without warning.
Furthermore, it’s important to note the competitive nature of the fintech industry in which Supply@ME Capital operates. As an emerging company, Supply@ME Capital could struggle to compete with more established companies such as PayPal as these firms continue to dominate the sector, stamp their authority on the fintech market and attract customers.
In case you missed our Podcast with Alessandro Zamboni, CEO of Supply@Me