Is the engage:BDR Share Price Stuck in Reverse? (ASX:EN1)

By ,

engage:BDR Ltd [ASX:EN1] is an internet-based marketplace platform.

EN1’s share price has been in heavy decline ever since it listed on the ASX at the end of 2017.

Though the digital advertiser hasn’t been without its wins.

In April last year we took a look at the company’s prospects.

Quite clearly these failed to materialise in the form of a higher share price.

Today may be a turning point.

The EN1 share price is up 25% at the time of writing, to trade at one cent per share thanks to a key deal in the European market.

engage:BDR taps Tappx for turnaround

EN1’s announcement today relates to its new partnership with European advertiser Tappx.

According to the Financial Times, Tappx is the second fastest growing advertising company in the EU.

Tappx delivers digital advertising solutions for multiple platforms including mobile, TV, and desktop.

According to EN1, over 35,000 app developers globally are currently using the Tappx platform.

Under the scope of the partnership, EN1’s publisher monetisation platform Tappx will bring EN1 direct access to top-tier ad buyers the company did not previously have access to.

EN1, which is a US-based company, said it had been experiencing disruptions in the demand of advertising due to COVID-19-related disruptions in commerce.

Check out these four innovative Aussie small-cap stocks before lockdown ends. Download your free report now.

Its new deal in the EU will help geographic distribution of revenue, which could enable quicker normalisation of revenue post pandemic.

2020 outlook for EN1 share price

In my opinion, the share price of EN1 is a little surprising.

Admittedly, for the average investor it isn’t easy to tell exactly what EN1 does — I’m not exactly sure myself.

Which shouldn’t really be a factor if the company is healthy and profitable — or sells a hot product or service.

The curious thing is EN1 is a profitable company.

It also has managed to drive significant revenue growth over the past year or so.

According to its 2019 figure, revenue in 2019 grew by 50% to $17.1 million.

EBITDA in 2019 yielded $1.6 million in profit.

A substantial improvement from -$7.3 million in 2018.

While net profit after tax stood at -$1.2 million, another improvement from -$10.8 million the year prior, EN1 has demonstrated decent growth potential.

This has continued in 2020.

EN1 reported revenue growth in the first half of 2020 was up 44% to $9.04 million.

Not bad considering the adverse effects many have experienced through the COVID-19 period.

Traditionally, the advertising industry traditionally expects 65–70% of its revenues in the second half of the year.

Meaning EN1 could produce further revenue gains.

There are certainly more factors to look out for that would explain the share price.

But we won’t go into them in detail today.

In the meantime, if you’re on the lookout for small-cap stocks that could capitalise on the mega-trends after lockdown ends, make sure you check out these four innovative Aussie companies. Check them out here.


Lachlann Tierney,
For Money Morning

About Lachlann Tierney

Lachlann Tierney is an Analyst for Money Morning and has been investing for nearly a decade. With a Masters of Science from the London School of Economics, he brings a sound understanding of global markets to his writing. Lachlann is interested in emerging technologies, energy solutions and helping people invest…

engage’s Share Price Continues Higher on Facebook ad launch

Earlier this week, engage:BDR Ltd [ASX:EN1] released a market update, revealing a revenue growth increase by 323% in Q1. Today, the company also announced the launch of its paid social business, alongside paid Facebook advertising. At the time of writing, engage’s share price is trading at 4.6 cents, up 4.54%.