What Made Two Technology Companies, Bigtincan Holdings and RPM Global, Soar High On ASX?

On a daily basis, the share price movement is determined by the market forces, or we can say by the demand and supply of that particular stock. Precisely, when a stock is in demand, more and more investors buy a stock which tends to move its share price in the upward direction. On the other hand, when people start selling the stock more than they buy them, then we say that the supply of the stock is greater than the demand.

Theory of demand states that investors tend to buy more stocks when they are available at a lower price. However, once the price attains a maximum level beyond which the buyers are not ready to pay for that stock, it is the time when more and more sellers enter the market to sell their stocks and make a profit.

Now the question arises about what those factors are, which influence the demand and supply of the stocks.

Let’s check out some of the factors which might influence the price of the stocks:

From a company’s perspective, it’s share price gets influenced when the company:

  • Releases news on earnings, profits, future outlook.
  • Declares dividend.
  • Launches a new product which has a strong demand in the market and also has future growth potential.
  • Secures new contracts.
  • Expected merger and acquisition
  • Announces management changes.
  • Gets involved in some Legal issues
  • Has identified some accounting errors or gets involved in a scandal.

From the Industry perspective, the share price also gets influenced because of industry prospects and performance.

Investor sentiment is another reason which influences the share price of any company. In case the market is bullish, the stock price increases, which shows that investor confidence is growing. It indicates about the economic recovery or economic boom or could also be because of investors’ optimism about the stock or the industry.

On the other hand, in a bearish market when the stock prices are falling, investor confidence is seen to decline. It may be because of the recession in the economy, increasing unemployment rate and increase in price inflation.

The share price also gets influenced depending on the performance of the market in which the company operates.

Other factors which also have an impact on share prices include:

  • Inflation
  • Deflation
  • Economic and Political issues
  • Country’s economic policy
  • Fluctuation in the currency value
  • Bank interest rate, etc.
  • Unemployment rate in the country

In this article, we would look at two technology stocks which have released positive announcements on 22 January 2019. As a result, their share prices have skyrocketed on ASX and reached near 52-week high prices. Let’s know about these announcements along with their stock performance.

Bigtincan Holdings Limited (ASX: BTH)

Bigtincan Holdings Limited (ASX: BTH), a global software company providing a leading AI-powered sales enablement automation platform, has released its Q2 FY2020 results for the period ended 31 December 2020.

The announcement had a positive impact on its share price as by the closure of the market on 22 January 2019, the closing price of the share was $0.865, up 24.46% from its previous close and reached near its 52 weeks high price of $0.890. The shares have generated a decent YTD return of 20.98%. On 23 January 2019, at AEDT 3:40 PM, the shares of BTH are trading at $0.860, down by 0.578% from its previous close. The market cap on 23 January 2020 is $266.73 million with 308.36 million outstanding shares.

Let’s take a look at Q2 FY2020 Activities and Q2 FY2020 Financial Highlights:

Financial Activities:

  • Acquired Xinnovation, Inc. during the quarter as well as completed the integration of Asdeq Labs Pty Ltd. These acquisitions added key technologies, customers, people and improved Bigtincan’s go-to-market competencies.
  • During the quarter, Bigtincan secured, in a highly competitive process, a 3 years and 6 months agreement for $2.8 million total contract value with Sephora USA Inc. Sephora USA Inc is a leading multinational chain of personal care and beauty products.
  • BTH continued with its investment in a multinational chain of personal care and beauty products along with product development with new team members added across the US, Australia and Israel.
  • BTH during the quarter also participated in the Dreamforce 2019 event in San Francisco. Thus, the platform provided the company to build on its new customer pipeline. Dreamforce is one of the main marketing events of the company every year.
  • During the quarter, BTH entered into an agreement with Databricks to use its market leading Data Science & Artificial Intelligent technology platform to add value to Bigtincan product offerings.

Q2 FY2020 Financials Highlights:

  • Customer cash receipts for the period was $9.1 million, up 102% from the previous corresponding period.
  • Cash payments which include working capital changes and acquisition related activities went up by 39% to $10.4 million.
  • Annualised recurring revenue increased by 55% to $32.4 million.

ARR History; Source BTH

  • Cash and cash equivalent by the end of December 2019 quarter was $27.4 million.
  • Net cash used in the operating activities during Q2 FY2020 was $1.249 million.
  • BTH used $7.708 million in investing activities while reported a net cash inflow of $18.811 million from the financing activities.
  • Net estimated cash outflow in Q3 FY2020 would be $10.550 million.

RPMGlobal Holdings Limited (ASX: RUL)

RPMGlobal Holdings Limited (ASX: RUL) is the leading enterprise technology, advisory and training provider in the mining industry. The company is a leader in enterprise solutions from mine planning till its completion.

RUL has most advanced scheduling tools in the industry plus top simulation, costing and execution solutions in production and maintenance, which are built on the industry's only Enterprise Planning Framework.

RPMGlobal Holdings on 22 January 2020, provided an update on total contracted value and annual recurring revenue which it derived from software subscriptions. The announcement had a positive impact on its share price. On 22 January 2020, the shares closed at a price of $1.110, up 18.717% from its previous close and attained its 52 weeks high price. On 23 January 2020, at AEDT 3:40 PM, the shares are trading at $1.07 PM, down 3.604% from its previous close. RUL’s shares have generated a decent YTD return of 30.59%. On 23 January 2020, the market cap of RUL was $241.89 million and has approximately 217.92 million outstanding shares.

The Total Contracted Value (TCV) of committed new software subscription revenue entered into by RPM during FY2020 to date is presently $17.7 million, a growth of $7.3 million from the earlier announcement made by the company on 19 November 2019. The total contracted value from 1 July 2019 till 19 November 2019 was $10.4 million. ARR from software subscriptions is now $10 million per annum which was $8 million in the announcement released to the market on 19 November 2019.

Now, the company is in the preparation of its 1H FY2020 results which depends on the external audit review and is expected to get released to the market in late February 2020.

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