Hristina Beeva

NeoMedia Technologies Inc. (PINK:NEOM) Picks Up Speed with Licensing Deals

by Hristina Beeva December 21, 2012
The line between the real and the virtual world is vanishing, as more and more companies add two-dimensional codes to their physical products, adding a web-based experience and extra information. The novelty and facility of barcodes is what props up the stock of NeoMedia Technologies Inc. (PINK:NEOM, NEOM message board), a ticker which has held up well and shows two successful trading days on news of new clients. NEOM1221.png

Although we warned the company could be heading downward faster, its stock held up in the longer term, although it showed some significant daily fluctuations that could lead to losses. In other respects, NEOM is financially healthy for a pink sheet stock, showing the following data:AMBI1221.png

  • $1.2 million cash
  • $7.7 million total assets
  • $ 849,000 net loss

Share dilution is one red flag for this company, as well as competition and the non-exclusive nature of its business. Lots of other companies offer different 2D codes to be integrated into product designs or print advertisements. The newest non-exclusive license was given to Mondel?z Global LLC, an intermediary offering barcode solutions. Another recent deal is with mobile services company SpyderLynk. The press releases for NEOM are quite far apart, but have a noticeable effect on investor interest.

The NEOM stock was briefly mentioned in an email by Microcap Millionaires, a no-pay message. Otherwise, the company had no active promotions and climbed around a week ago after releasing its financial data. The other major risk this company holds is stock dilution and the issuance of convertible debentures, which may depress the stock price and leave a large amount of shares waiting to be sold. The company's 6.9 million market cap, however, is quite in measure with the assets of this group.

Microcap Millionaires is a zero-compensation promoter that takes part in small-scale mailing campaigns. One of its picks, Amwest Imaging Inc. (OTC:AMWI) was actively bought during the February promotion, but later lost more than 95% of its value and settled in triple-zero category. In the case of companies presented in this way, it is best to estimate if you can afford losing your investment. It is best to be informed well about the company's underlying strengths before buying the email hype.

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