Supply ME Capital Price Forecast July 2021 – Time to Buy SYME?
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Supply chain finance specialist Supply@ME Capital PLC (LSE: SYME) is in the news lately, following the release of Proactive Research Analyst Ed Stacey’s report on the company. According to his report, strong growth in revenue is expected from Supply@ME Capital PLC after its TradeFlow deal and inventory securitisation programme.
Supply ME Capital Share Price – Technical Analysis
Based on the financial statement released by Supply@ME Capital PLC, the company’s market cap is £109.887 million with total assets worth £220,000. SYME shares closed on July 15th at £0.3130 with a downtrend of -2.49%.
On the technical side, Moving averages for Supply@ME Capital PLC such as Volume Weighted Moving Average (20)(0.3540), Simple Moving Average (100)(0.4299), Exponential Moving Average (200)(0.3982) and Simple Moving Average (200)(0.4659) are pointing towards selling. On the other hand, oscillators such as Stochastic RSI Fast (3, 3, 14, 14)(0.0000), Williams Percent Range (14)(−94.0541), Bull Bear Power (−0.0605) and Ultimate Oscillator (7, 14, 28)(43.0548) are pointing towards neutral.
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Recent Developments
Recently the company has completed the acquisition of TradeFlow Capital Management, a Singapore-based non-credit financing company in a cash and stock deal. While the stock part of the deal consisted of the creation of 5% or £5.6 million worth of SYME shares, the cash part covered a total of £5.6 million worth of convertible loan notes in June 2021.
Despite being loss-making with a staggering loss of £2.964 million in 2020 the company’s clients have more than doubled. However, there is one single stakeholder who has acquired 6% of the total inventory sales, which is a worrying sign. It is also a new company in the stock market, being listed in April 2020 via a reverse takeover. UK financial regulators have finally given the shares the permission to trade again back in March 9th.
Should You Buy SYME Shares?
As a company that owns shell companies that in turn purchase unsold inventory, Supply@ME Capital PLC packages them into securitised notes to sell to funders. The inventory remains on their premises as the seller’s lease makes up for it. While demand still exists for monetised unsold inventory, the company’s current share price isn’t a bargain as many investors might think.
One obstacle is its business model which seems to be designed to prevent any creditor-creditee relationship from developing between Supply@ME Capital PLC and its customers. This makes it rather unclear as to who is liable if uninsured inventory remains unsold. There are chances that the company may face legal wrangles and financial difficulties, which is why investors should stay away from SYME shares for the time being.
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