In our last article about Iddriven Inc (OTCMKTS:IDDR), we noted that news were driving the share price. Thus, we encouraged readers to follow the new announcements closely.
Additionally, the company focuses on identity and access management enterprise solutions. So, it was an interesting play when data breaches like that of Equifax Inc. (NYSE:EFX) hit the market. Finally, the company noted in September that it was looking for mergers and acquisition to enhance shareholder value. We believe that it was an interesting initiative that could push the share price higher.
Regarding the recent share price dynamics, the share price declined from the 5-month highs that were hit in September. We believe that market participants used profit taking sell orders pushing down the stock price. No bad news were received by the market, so it seems to be the easiest way to explain the share price move.
We want the readers to check the following stock chart for something interesting. The amount of shares that changed hands in the beginning of November increased quite a bit along with the share price volatility. The volume went up to almost 400 million shares, which is astonishing.
In this article, we will try to explain what’s going on:
For those who don’t know the company, IDDR develops software that helps “users ensure that access across multiple technological environments is granted only to the right individuals.” The flagship product is IDdriven, which manages large amount of users in applications in hybrid environments (cloud and on-premise).
Have a look at the following video about this tool.
On September 19, 2017, the company provided an overview of the recent improvements on IDdriven. According to the press release, the company worked in the last months on several new features. We believe that the most interesting functions are the following:
- Over-write function on segregation of duties: the new development is that the application manager or administrator can determine whether a toxic permission can never be over-written, needs approval by the security officer, or needs approval by the application owner.
- New menu item named ‘Policies’: it will give the overview of all policies applied in the IDdriven environment.
- Update for model browser: the model browser provides the ability to browse through the OU’s, Users and Roles. Thanks to the new features, the system can show child roles and access rights.
- Edit role names: from now on, users with the internal IDdriven access right ‘Role manager’ or ‘Administrator’ are allowed to change role names.
What’s the company working on right now?
Arend Verweij, CEO of IDdriven, explained that the company is focused on providing new cloud solutions with the latest technologies. We encourage readers to assess future announcements about the company’s new technology, as this seems to be the most significant catalyst in this company.
On October 10, 2017, the company released a letter of intent with ioSafe Inc. to acquire 100% outstanding shares of ioSafe Inc. This company is a leader in disaster proof data storage. It was founded in 2005 and focuses on providing services to other companies that help keep data secure as well as complete line of fireproof and waterproof data storage solutions.
ioSafe seems to have accumulated large amount of know-how and expertise, which we believe is interesting for IDDR. It is said to have accumulated over 100,000 units. Additionally, it owns a customer base focused on security, disaster protection, and compliance that may serve IDDR as well. The synergies may be significant.
Arend Verweij, CEO of IDdriven, Inc., was quoted:
“As we stated in the past, if the right opportunities arise, we will use that if it is aligned with our goal to grow revenues and access to customers. ioSafe represents such an opportunity.” Source
Share Capital Statistics – It is a low float runner
The following information is provided by the OTC Markets:
|Market Value1||$533,029||a/o Nov 02, 2017|
|Authorized Shares||10,000,000,000||a/o Oct 31, 2017|
|Outstanding Shares||666,286,793||a/o Oct 31, 2017|
|-Restricted||64,395,004||a/o Oct 31, 2017|
|-Unrestricted||601,891,789||a/o Oct 31, 2017|
|Held at DTC||520,943,605||a/o Oct 31, 2017|
|Float||21,774,690||a/o Dec 27, 2016|
|Par Value||Not Available|
What’s our take?
The float is 21,774,690 shares, while the total outstanding shares is 666,286,793. This means that the float is quite low. This may justify the share price volatility seen in the beginning of November as well as September.
Additionally, we believe that short sellers seem to be operating in the stock. In October, we could see large increase in the amount of short interest. The activity of the unethical operators could also explain the share price decline:
|Date||Short Interest||% Change||Avg. Daily Share Volume||Days to Cover||Split||New Issue|
|Oct 13, 2017||962,053||100.00||76,861,737||1.00||No||No|
|Aug 31, 2017||17,788||-30.63||21,213,919||1.00||No||No|
|Aug 15, 2017||25,641||100.00||1,013,284||1.00||No||No|
|Jul 14, 2017||7,400||100.00||1,646,196||1.00||No||No|
|May 31, 2017||31,850||100.00||654,124||1.00||No||No|
We believe that a Short Squeeze could occur on this name, which would send the share price higher. Thus, we encourage shareholders to be very alert. It may be a profitable move.
Currently trading with a market cap of $0.5 million, IDDR is an exciting story among small caps. With $2.9 million in total liabilities and $0.012 million in cash, we continue to believe that the share price is driven by new announcements. Thus, this is what, in our opinion, should be checked out.
To sum up, there is a lot to like in this company. It is a stock with the potential to turn into an overnight runner.
We will be updating our subscribers as soon as we know more. For the latest updates on IDDR, sign up below!
Image courtesy of Benny Chandra via Flickr
Disclosure: We have no position in IDDR and have not been compensated for this article.