Pureprofile Limited - (ASX: PPL)

PPL was incorporated in 2000 and is based in Darlinghurst, Australia. The company is engaged in profile marketing and technology services for marketers, researchers and publishers across Australia and various other geographies. The company operates through three segments: Data & Insights, Media, and Performance. The current market capitalization of the company is $33.85 million, with a current price of $0.030 per share.

Fundamental Highlights- The company recently announced a partnership with Flybuys, aiming to provide the PPL’s SaaS technology for extensive use of research community for Flybuys members. The company recorded an increase in revenue by 25% to $7.1 million in Q3 FY21 over PCP and the rise in the cash balance of $3.4 million as of 31^st March 2021 compared to the $3.1 million on 31^st December 2020. The increase in EBITDA was 150% to $0.50 million as compared to the 3Q FY20. PPL posted a net profit of $4.82 million in 1H FY21 as compared to the loss of $5.36 million in 1H FY20.

Technical Analysis- The stock witnessed a sharp downtrend past few years and after bottoming out it is showing a gradual move towards the North. The relative strength index shows the reding of 60.95 which shows some more upside to the stock prices. The 21 Days Simple Moving average is currently $0.028 which is below the stock price, indicating a further upside trend to continue. The support is placed at $0.021 levels which need to be respected for the stock to show recovery from the lows it printed and now heading for mild gains. The resistance is currently at $0.053 and $0.058 levels, which needs to be taken off for gaining further traction at the stock prices. 

Considering the full year FY21 and interim 1HFY21 results are expected to release on 20^th July 2021, the stock prices are expected to remain volatile, it is prudent for ‘Investors’ to consider additional risks associated with the results announcement as per the guidance provided. Therefore, we recommend a ‘Watch’ stance on the stock and wait for prices to settle down, post-release of the results and its fine prints, before taking any fresh entry in the stock as per the closing price of $0.030, down by 6.25%, as on 19th July 2021.

Daily Technical Chart – PPL

Source: REFINITIV

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on the investors’ appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest. 

The Green colour line reflects the 21-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Purple colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

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