We appreciate companies that react to the declines in their share price. It is one of the best indicators to identify a good pick. In our opinion, if new initiatives are undertaken to increase the shareholders, the company is interesting.
Which initiatives can enhance the shareholders?
Many good options are out there, but one of the best is the repurchase of stock. In this option, the company uses its cash to buy the stock. As a result, the demand for the stock and the share price usually increases. Market participants know this fact very well, which has been shown by academic researchers, and usually buy the stock as well looking to capture future stock returns.
One clear example of this interesting way of maximizing shareholder value is the stock repurchase commenced by Glance Technologies Inc (OTCMKTS:GLNNF). It was announced after the company saw how its share price declined almost 100% in two months. We appreciate the quick reaction of the company.
Check out the stock chart before we provide more information:
2 month chart for GLNNF
For those who don't know GLNNF, let us revise its background very briefly. The company operates Glance Pay, a streamlined payment system, helping users shop and make payments.
It retained our attention recently after signing licensing agreements totaling approximately $9 million. The sum is quite large for a $103 million market cap company like GLNNF. It also shows that the company is growing at an impressive pace.
Additionally, we are also interested in its recently acquired blockchain solution. The new technology can reward users with cryptocurrency besides executing big data analysis with Artificial Intelligence. This is the way that the new systems are exhibited on the website:
Image from the Website, Glance Coin - GLANCE TECHNOLOGIE OTCMKTS:GLNNF
What do we think about the share price decline?
We believe that the performance of GLNNF has been satisfactory. The company has been able to raise $11 million in bought deal financing. Furthermore, it has also acquired the Blockimpact platform for $1.1 million and still has $17.4 million in cash for financing new developments.
Nothing recently released justifies the share price decline.
So, what's happening to the share price?
The bad market performance of the BlockChain industry is affecting the GLNNF. The Bitcoin price, which touched the $19,000 mark in December 2017, has lost more than 65% in less than two months. Additionally, many competitors have also lost half of their market capitalization.
Have a look at the following chart. It shows the market performance of some industry leaders:
BlockChain Industry - GLANCE TECHNOLOGIE OTCMKTS:GLNNF
What's happening? Experts in the field have noted that later entrants are diminishing. This seems to be affecting coin prices. Check the following text from a prominent website in the ICO industry:
"The confidence that many of the later entrants had in their positions has all but dried up. People are exiting the market in spades and the selloff is resulting in a further weakening of price. This, in turn, is translating to more panic and an increased number of market exits." Source: Global Coin Report
Additionally, many are saying that the decline represents a great market entry. Undoubtedly, it is much better to position with the BTC at $7k than at $19k. But, we will see in the following months if they are right.
Entering the blockchain sector
Let's revise in detail the most remarkable developments of GLNNF.
The company ended November 2017 receiving $11,052,000 from investors. This is what we wanted to read. GLNNF now has sufficient cash to fund new projects. It is very significant.
We did not have to wait a lot to see the use of the new cash.
In December, the company acquired the Blockimpact, a blockchain solution, from Ztudium Inc. It paid $1.1 million for this acquisition. The purchase included the entire intellectual property comprising of the Blockimpact platform. The company plans to integrate the new system with the Glance Pay mobile payment platform. Integrating IP assets many times represents a game changer for emerging industries. Thus, we will need to monitor GLNNF closely.
On the top of it, Glance Blockchain Token Inc. was created in December 2017. The role of this company is exciting. It will be responsible for developing the Glance token. Glance CEO, Desmond Griffin, explained it with the following words:
“The Glance token will be a rewards token that will incentivize both the business and consumer users of Glance. We are thrilled at the possibility of introducing an entirely new group of users to cryptocurrency through our platform.” Source
The growth continues
In January 2018, GLNNF noted $1 million fees from the sublicense of Glance’s mobile payment app technology. The fee resulted from a deal signed between GLNNF's subsidiary Cannapay Financial Inc. and Cannabis Big Data Holdings Inc. That's not all. The company also signed a deal with Fobi Pay Technologies Inc. Under the new deal, Fobi will receive the license for a $5 million fee for an initial one-year term, renewable annually for $10,000 per year. We have noted it previously. Despite the share price decline, these new deals show that growth continues.
Additionally, the company continues to develop new business relations. On December 7, 2017, GLNNF signed an agreement with Fatburger Canada. The fact that this client runs 52 locations across the country makes the deal remarkable.
The most important catalyst: The repurchase of stock
We want to provide detailed information about the buy-back program. We know that the market will be interested. On January 30, 2018, the purchase up to 6,500,000 shares was noted. What you need to know is that the acquisition commenced on February 5, 2018. Additionally, please note that the program will not last more than a year.
Why is Glance doing it? According to Glance, the market price "may not fully reflect the underlying value of Glance's business and its future business prospects." We believe that the following words are critical. They were included in the press release:
"Such purchases are expected to benefit all remaining shareholders by increasing their equity interest in Glance." Source
Conclusion
Currently trading with a market cap of $103 million, GLNNF is an exciting story among small caps. The increase in assets is the key feature to understand the success of Glance. In the last three quarters, it has increased more than 124%. As of August 31, 2017, it was equal to $1.84 million. Furthermore, the financial risk is low since the liabilities are equal to $0.3 million. The increase in revenue is also remarkable. In the third quarter, the company made 39 times the revenues obtained in 2016.
To end, we recommend reading the letter from the CEO. It will help the readers understand why we are positive about the future of GLNNF.
Be sure to check out our coverage on GLNNF!
We will be updating our subscribers as soon as we know more. For the latest updates on GLNNF, sign up below!
Disclosure: We have no position in GLNNF and have not been compensated for this article.Image courtesy of tcbe.ch ICT Cluster Bern via Flickr
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