The share price of 1-Page Ltd (ASX: 1PG) has gained 4% to $3.75, after the company announced that it had signed 9 annual contracts with a value between US$50,000 and US$300,000.
The 9 contracts are for the company’s Sourcing Platform, which allows businesses to find new employees and the skills and experience they require. According to 1-Page, the company hand curates pools of talent from more than 1 billion human verified aggregated profiles that contain up-to-date information as well as detailed professional history.
The platform allows companies to stop sorting through multiple online profiles, allows them to find job candidates from within its employee’s existing networks and saving them time and money.
1-Page has already signed up an impressive list of clients to its products, including Amazon, Sears, Starbucks, Accenture, Red Bull, Buzzfeed, and telco Orange.
At today’s share price, 1PG boasts a market cap of over $387 million, despite revenues of just $158,900 in the six months to end of July 2015. Clearly investors are hoping that clients signing on to 1-Page’s platforms will begin to generate significant revenues.
Indeed, the company itself says that each of the 9 enterprises that signed today’s contracts is expected to quickly scale to an average revenue generating contract of more than US$300,000. Each of them has an average of in excess of 20,000 employees per company, suggesting there are plenty of opportunities to grow. Already, 1-Page says some clients’ requirements are already starting to expand beyond the contracted minimums.
The key question is, are 1-Page’s shares at $3.78 still a bargain, or are they set to fall? Given the released financial results so far, investors are taking a mighty leap of faith that 1-Page’s platforms and products will be hugely successful. Not only that but shareholders are also expecting the company to generate significant revenues and profits at some stage down the track as a return on their investment.
1-Page is highly speculative and risky, so investors might want to limit their holdings to a small percentage of their portfolio, if they invest at all. Conservative investors might want to give the company a miss until more solid results are on the board. With its disruptive nature and revolutionary approach, it’s definitely one company I’m keeping an eye on.
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Motley Fool writer/analyst Mike King doesn't own shares in any companies mentioned. You can follow Mike on Twitter @TMFKinga
Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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