Smith Micro Software, Inc. (NASDAQ:SMSI)
Smith Micro Software, Inc. (NASDAQ:SMSI) develops wireless software solutions for global wireless service providers, mobile and chip manufacturers, and enterprise businesses. They also create graphics software for animators, illustrators, graphic designers, and students. Today the nano-cap firm is experiencing massive volumes compared to the 30-day average daily volume figure of just 43,110. By 11 AM EST, SMSI shares have a trade volume of over 700,000 – over 43 times their normal adjusted daily volume. A review of their press releases shows that no news has been released that would normally account for such a volume spike.
Shares of Smith Micro Software, Inc. (NASDAQ:SMSI) closed Thursday at $1.13, and SMSI shares gapped up slightly to open at $1.16. They hit a high of $1.39 for a gain of over 20%. However subsequent trading has seen SMSI shares decline back beneath yesterday’s closing level. SMSI has been trading close to its 52-week low of $0.80 for the past several weeks and is down almost 65% from its 52-week high of $3.20.
The market may have found motivation to invest in Aliso Viejo, CA-based Smith Micro Software, Inc. (NASDAQ:SMSI) after their Wednesday announcement concerning Thailand’s leading mobile service provider, dtac, selected the company’s SafePath Family platform to provide its customers with tracking and parental control services. Dtac serves more than 25 million consumers in Asia. The service will be white-labeled as dtac Family Care.
Smith Micro Software, Inc. (NASDAQ:SMSI) released their FY2016 financial results in early March. For the fiscal year ended December 31, 2016, the Company reported revenues of $28.2 million, compared to $39.5 million for FY2015, a decrease of 28.5%. FY2016 gross profit was $20.7 million, compared to $31.4 million for FY2015, a decrease of 34.1%. Gross profit as a percentage of revenues was 73.2% for FY2016, compared to 79.4% for FY2015. GAAP net loss for the fiscal year ended December 31, 2016 was $14.5 million, or $1.21 loss per share, compared to a net loss of $2.6 million, or $0.23 loss per share, for FY2015. Total cash and cash equivalents at December 31, 2016 were $2.2 million.
Smith Micro Software, Inc. (NASDAQ:SMSI) has had declining sales since 2012 with 2015 being the lone outlier. In 2012 the company reported sales of $43.3 million but by 2016 that figure had decreased to $28.2 million. EPS have been losses every year since 2012 and in 2016 the EPS loss was (-$1.12). Meanwhile shareholders have been experiencing a steady dilution. In 2012 the number of outstanding shares was 8.96 million – a number which grew to 11.95 million by the end of 2016.
I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.
About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading.