Shares of Ironclad Encryption Corp (OTCMKTS: IRNC) are languishing at all-time lows after shedding more than 90% in market value, in the first quarter of the year. Investor’s sentiments in the stock are at all-time lows as the stock’s underperformance over the past year persists.
IRNC Share Price Analysis
The stock has crumbled amidst soaring short selling pressure, bulls have lost confidence about the company’s long-term prospects. Waning investor confidence does not come as a surprise. The company has failed to reinvigorate investors’ confidence in failing to release substantial press releases or updates.
The last piece of information about the company’s operations came last year. At the time, the company confirmed it had received an allowance for six essential patents. In October, the company received a boost on Layer 3 Communications validating its Cyber Security technology.
Subdued market activity and declining share price come on investors shunning the stock given the lack of substantial news updates. The stock is currently languishing at the $0.01 level, after plunging from the $0.20 level, as of the start of the year.
IronClad Encryption plunge started early last year as investors continued to question the company’s long-term prospects. With the stock currently engulfed in a long-term bear trend, it would take groundbreaking news for the stock to bottom out.
For the stock to turn bullish in the short-term, it will have to rise and stabilize above the $0.05 mark. Below the critical technical level, the stock remains susceptible to further drops.
About IronClad Encryption
IronClad Encryption casts itself as a cyber-defense company focused on developing solutions for securing digital assets and communications across a wide range of industries and technologies. It boasts of a proprietary patented Dynamic Encryption and Perpetual Authentication Technologies used in the development of key-based encryption technologies.
Why Has IronClad Encryption Imploded?
IronClad Encryption has continued to implode on continued questioning of its long-term prospects. The lack of updates on the solutions the company is working on, or progress made on already unveiled solutions, continues to hurt the stock’s sentiments in the market.
Patent Issuance Uncertainty
Late last year, the company confirmed that it had received a notice from the United States Patent and Trademark Office. The notice indicated that the company was on course to receive six of its patents before the end of the year.
IronClad Encryption is yet to come out and confirm whether it did receive the patents, crucial to the strengthening of the company’s Intellectual portfolio. One of the patents touched on a system detailing executable coded cipher keys while the other detailed a system for securing temporal digital communications with authentication.
“Having these patents allowed and issue by the end of the year is an important milestone for IronClad to secure its patent portfolio and deliver highly differentiated, best-in-class security product. Our patent portfolio is one of our greatest assets and will serve as the foundation of the company’s success for years to come,” said CEO JD McGraw.
Layer 3 Communication Validation
In October, IronClad Encryption did receive a boost in the cybersecurity space on Layer 3 Communications validating its encryption cybersecurity technology. Layer 3 Communications also confirmed plans to release a white paper explaining the validation procedures as well as parameters as well as the technology significance.
Validation is a significant milestone in the development of the ICEmicro technology. The technology seeks to ensure communications between software as well as devices and network equipment. It is also designed to secure data communications between data centers cloud networks and hybrid environments.
“Layer 3 Communications’ validation and endorsement of our ICE micro technology is a major milestone for IronClad. Layer 3’s third-party written evaluation of our technology gives IronClad true market credibility,” stated Mr. McGraw.
IronClad Encryption looks set to remain under pressure until it starts providing updates underlying cybersecurity solutions development and milestone achieved. The company also needs to come out and provide updates on the issuance of patents as well as the validation of its ICE micro encryption cybersecurity technology.
Until then, short sellers are likely to remain in control and could continue to push the stock lower. With the stock currently languishing at all-time lows, it might be wise to wait for groundbreaking catalysts before considering IronClad an investment play.
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Disclosure: We have no position in IRNC and have not been compensated for this article.