After touching 52-week record highs in last December, SinglePoint, Inc. Common Stock (OTCMKTS:SING) is retracing back below the $0.05 mark. Like the shareholders and management, we could not foresee the downward market trend, as SING keeps growing at the same rate seen in 2017. The recent acquisition of ShieldSaver, the launch of a new cannabis payment solution and the application of the blockchain technology to several sectors show that growth is continuing.
Check the price action in the chart below before we provide more details:
The stock collapsed from $0.10 to over $0.04 in less than two months. In our opinion, a close below the $0.03 mark would alarm the shareholders and contribute even more to increase pessimism about this name.
Trading volume has increased recently, as some market participants are buying the dip. We hope that the buying pressure is enough to resist the attack of the shorts. Have a look at the following one month chart:
For starters, let’s revise what SING does to enhance shareholder value. SinglePoint, Inc. is headquartered in Phoenix, Arizona, and was founded in 2006. It casts itself as a technology and investment company with a focus on acquiring companies that will benefit from the injection of growth capital and technology integration. The company portfolio includes mobile payments, ancillary cannabis services, and blockchain solutions. Through acquisitions into horizontal markets, SinglePoint is building its portfolio by acquiring an interest in undervalued subsidiaries, thereby providing a rich, diversified holding base.
The following video is, in our opinion, a great way of getting to know the recent achievements of SING. Have a look:
The company had an outstanding year in 2017 that culminated with the uplist to the OTCQB market
If you have not followed the company in 2017, listen to the following. Last year, SING spent a considerable amount of time pursuing growth through accretive acquisitions and building solutions based on bitcoin and blockchain platforms that solve key issues within the cannabis markets. This smart strategy enabled the company to surpass $100 million market cap and significantly expand its acquisition portfolio.
On the top of it, PCAOB firm Turner Stone completed a corporate audit that helped the company uplist in 2018 to the OTCQB market.
Trading on the OTCQB market does not only mean that SING has easier access to financing. The entity is now more transparent, so it will be able to draw the attention of more market participants, and the shares will become more liquid. Additionally, banks will be more willing to lend to the company, which may help the management keep the acquisition trail going. We share the optimism shown by the management on February 6, 2018, when the shares commenced trading on the OTCQB:
“We are extremely pleased to be approved for OTCQB. It is a great step for SinglePoint as we continue to grow and build our footprint. Increased transparency and credibility will help broaden our shareholder base and provide additional exposure to the institutional investor community, ultimately contributing to increasing shareholder value,” states Greg Lambrecht CEO SinglePoint.
New Agreements and acquisitions
The number of partnership agreements and acquisitions signed is large. We will try to mention and assess the most remarkable for the growth of SING. The complete list can be found at the website of the company.
One of the most remarkable agreements was released on December 20, 2017. SING formalized a letter of intent with Smart Cannabis Corp, under which SinglePoint would distribute Smart Cannabis’ SMARTAPP automation software. We appreciated two facts. Firstly, we like that the companies are targeting a large market projected to be in excess of $50B by 2020. In addition, we were very interested in the synergies announced by SING:
“Our relationship with SinglePoint is a game changer.” Don Smith, Vice President of Smart Cannabis Corp.
“With the data Smart Cannabis Corp collects through their Track and Trace Software system, SinglePoint will be able to start building a blockchain platform giving further insight in the cultivation and sale of cannabis related products,” states Wil Ralston President, SinglePoint.
There is more.
On January 23, 2018, the company also announced a letter of intent to acquire 100% of Bitcoin Beyond, a premier platform that enables retail merchants to accept bitcoin payments using their existing web-enabled point-of-sale device. Despite the fact that the market did not react to the news, we believe that it was beneficial. Think about it. For only $1 million stock, SING will get the end-to-end purchasing experience accumulated by Bitcoin Beyond. The reaction of the management was obviously very positive:
“We are thrilled with this opportunity. Acquiring Bitcoin Beyond put us ahead of what we believe merchants have access to now. This platform has by far the easiest user interface we have seen in the market, and we are confident merchants will be quick to adopt this solution as it stands as the sole alternative to traditional options offered to the cannabis industry,” states SinglePoint President Wil Ralston.
Taking into account the fact that the company has not yet closed the acquisition of this target, the transaction represents an interesting catalyst. Stay tuned to this name, as a definitive merger agreement could make the market react. The share price could run.
On the top of it, on February 27, 2018, SING announced a letter of intent to acquire a stake in California cannabis cultivation MTH Development Group further establishing its California footprint. With MTH currently operating 4.7 acres of land zoned for cannabis cultivation and the cannabis industry growing at a high pace, this seems to be an interesting investment. We want to also draw the attention to the fact that SING is in negotiations to make similar investments in other states. More announcements in this regard could be a serious catalyst for the stock.
March 2018 was also an interesting month in terms of announcements. While the stock performance was not beneficial, yet the company continued to show that the business is growing. The most remarkable was the announcement of its payment solution for the cannabis industry; SingleSeed Payments. With still little information about the success of the new software, we appreciate that an in-house engineer with expertise in acquiring projects for companies, such as Coinbase, is working on the launch.
Additionally, in March, SING released an update noting two additional targets. The most remarkable is that they have approximately $15 million in revenue and EBITDA of about $4 million. Please, be sure to understand that acquiring these target companies would make SING larger. The potential future revenue would increase, which could lead the stock to run.
The acquisition of ShieldSaver and conclusion
On March 27, 2018, the company culminated the month delivering the acquisition of ShieldSaver, which is a technology company disrupting the automotive repair and maintenance industry. The most interesting factors for this company are “its unique permissions to enter locations that are typically off limits, obtain critical vehicle data at those locations, and then make contact with vehicle owners regarding needed repairs on their cars.”
Taking into account that “no other company is able to do” so, we believe that the transaction will bring unique capabilities to SING. With the company expecting ShieldSaver acquisition to provide additional $1.25 million in revenue for 2018, in our opinion, the benefits of the transaction will be larger if the engineers of SING collaborate with ShieldSaver. We are not only thinking about synergies but also about the future benefits of designing blockchain solutions in the automotive industry.
Currently trading with a market cap of $42 million, SING is an exciting story among small caps. With $2.2 million in assets and $1.1 million in total liabilities reported in September 2017, we believe that these figures will grow after accounting for the new acquisitions. Maybe the market pushes up the share price when the new financials are released.
Disclosure: We have no position in SING and have not been compensated for this article.
Image courtesy of George Carter via Flickr.