The Integrated Research Limited (ASX: IRI) share price had a superb day today. Integrated Research shares closed the day up 7.66% to $2.39 a share after closing at $2.21 last Friday and opening at $2.30 this morning. The shares were as high as $2.43 during intra-day trading as well, a rise of more than 9% at the time.
However, zooming out and it becomes clear that today's moves are just some sugar on what has been a very unpleasant sandwich investors have had to endure over the past year. Even after today's gains, Integrated Research shares are still down more than 50% from the company's 52-week high of $4.92 that we saw back in August last year. They are also at a similar level to what you could have purchased them for back in 2015.
So who is this company? And why are Integrated Research shares doing so well today?
A well-integrated company?
Integrated Research is a company that trades in IT solutions. It writes and sells software platforms that assist business clients in simplifying and optimising their digital operations and data. It does so through three product offerings: IR Collaborate, IR Infrastructure and IR Transact. All three of these products are available through Integrated Research's Prognosis platform.
The company can boast some A-list clients, including Commonwealth Bank of Australia's (ASX: CBA) BankWest, the US telco Verizon Communications Inc (NYSE: VZ), Ford Motor Company (NYSE: F) and the US pharmacy chain Walgreens of Walgreens Boots Alliance Inc (NASDAQ: WBA).
Software-as-a-Service (SaaS) companies have been very popular with ASX investors in recent years. But, as we touched on earlier, things haven't been going Integrated Research's way over the past year or two. the company was hard hit by the coronavirus pandemic last year. Business closures and purchasing deferrals have resulted in revenue and profit writedowns for the company. A sharply rising Aussie dollar over the past year or so also hasn't helped.
In fact, it was only last month that Integrated Research gave us a half-year earnings update for the six months to 31 December 2020. In this update, Integrated Research told investors that revenues were down 56% on the prior corresponding period. While net profits after tax had collapsed 99% to $129,000.
Why are Integrated Research shares up today then?
At first glance, it's not entirely obvious why Integrated Research shares are rising so enthusiastically. The last piece of official news out of the company came back on 22 March. That was a notice that Integrated Research's chair Paul Brandling had resigned from the company effective 20 March. He has been replaced as chair by Peter Lloyd.
The only clue we have to today's massive share price movement is trading data from the ASX. ASX data shows that trading volume today is, at the time of writing, sitting at 448,000 shares. That's well above the company's 5-day average of ~190,000 shares, and well exceeding Friday's number of 142,000 shares. This could be indicating that a large fund manager or other institutional investor has been initiating a large positioning in the company.
Whatever the cause, it has been an indisputably good day for Integrated Research shareholders. On the current share price, the company has a market capitalisation of $408.15 million.
