DigitalX Limited

Appointment of Non-Executive Director: Information Technology company, DigitalX Limited (ASX: DCC) provides global token sale advisory, blockchain technology development services and asset management. The company recently announced appointment of Stephen Roberts as Non-Executive Director of the Company, effective from April 3, 2019.

Mr. Roberts has served as Chair and non-executive director of several listed and private commercial enterprises across financial services, bio-pharm logistics, agriculture and waste recycling.Recently, Mr. Roberts served as Regional Chief Executive Officer and Senior Partner of Mercer Investments, Asia Pacific and prior to that, he was the Managing Directorof Russell Investments, Australasia.

In the half yearly result, the company reported decrease in its revenue from ordinary activities by 78% pcp to US$764,955 in H1 FY 19, which can be attributed to lower revenues from token advisory.It reported loss after tax at US$4,178,031 in H1 FY 2019 from profit after tax at $8,031,669 in H1 FY 2018.

Segment-wise Financial Metrics H1 FY 2019 (Source: Company Reports)

What To Expect From The Company:While ICO funding got slowed during 2H of calendar year 2018, reflecting the short-term sentiment within the cryptoasset market, DCC had been working diligently on shaping its offerings towards the evolving Security Token Offering (STO) market. The company stated that the market is maturing with high profile STO exchanges such as Open Finance and tZero coming online to provide secondary trading of STOs over 2019 calendar year.
As the STO market matures over 2019, the company is well-positioned to give services and remains leveraged to an uptick in activity in cryptoassets.

Stock Recommendation:DigitalX Limited’s share generated positive YTD return of 34.62%. Its current ratio for H1FY19 stands at 22.05x better than the industry median of 1.84x, which presents company’s ability to better address its short-term obligations than its peer group.

Therefore, decent outlook, higher current ratio as compared to the industry median and the space of operations might provide a better opportunity. Hence, we give a “Speculative Buy” rating on the stock at the current market price of $0.085 per share, up 21.429% on April 8, 2019.
 

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