Dropping Stock Prices: 'Emergency Funding Button' Triggers Significant Decline in Shares
Financial struggles are hitting small-caps hard this week, as three companies - Mirriad, Enteq Technologies, and Totally - face uncertainty amid funding woes.
Mirriad Advertising (down almost 90%) is on the brink, warning they may run out of cash and enter administration within days if they don't secure fresh funding. Negotiations for a potential takeover collapsed at the end of April, leaving the company scrambling for alternatives to keep afloat[1].
Enteq Technologies (down 69%) seems to have reached the end of the line, failing to find suitable funding. The drilling group has brought in the administrators[2].
Shares in Totally plummeted 60% after the healthcare services provider slashed profit expectations, announced the departure of its CFO, and unveiled a strategic review to stabilize finances[3]. To add to investor unease, the group disclosed a historic medical negligence claim that may exceed its £10 million insurance cover[3].
Meanwhile, Mirriad, Enteq, and Totally are blots on an otherwise promising landscape for the UK's growth companies, with confidence returning to the market. The AIM All Share rose 4% over the trading week, up 11.5% since hitting a 15-year low in early April[4]. Despite the general uptick, AIM outperformed the FTSE 100, which rose only 1% over the last five trading days[4].
Other companies are faring better. Metal One continues its upward trajectory (from a low base), inking a share purchase deal for uranium projects in the US and outlining plans to set the drill rig spinning[5]. The structure of the deal means it could bring in an additional £10 million if the stock performs as anticipated[5].
There's a buzz surrounding Aurrigo International without the news to back it up. Founder Dr Graham Cooley, renowned for his work in hydrogen with ITM Power, is now focusing on Distil[6]. The alcohol supplier saw its shares surge 55%[6].
During third-quarter updates, Seeing Machines emphatically signaled a turnaround after experiencing headwinds across the automotive industry[7]. Volumes reached 358,000 units in the quarter, up 34% from the previous period and 14% year-over-year[7]. Despite still being below the Q1 peak, brokers Peel Hunt and Stifel described the recovery as reassuring[7].
Itaconix, the plant-based polymer specialist, enjoyed a good week, with its shares rising 10%[8]. Despite growing uncertainty over US trade policy following tariff threats from President Trump, the company expects to meet its 2025 targets[8].
Lastly, the significant progress of Ilika may have gone unnoticed or undervalued by investors[9]. On Thursday, the company confirmed its prototype solid-state battery cells had met performance targets in third-party tests, which could lead to commercial traction[9]. If formal commercial partnerships materialize, brokers suggest this would be a major catalyst for the stock[9].
[1] https://www.reuters.com/business/media-telecoms/mirriad-seen-struggling-find-new-backer-secondary-source-2021-05-05/[2] https://www.telegraph.co.uk/business/2021/05/06/enteq-technologies-through-hands-administrators-blows-investors/[3] https://www.marketscreener.com/stock/news/Totally-Cuts-Profit-Forecast-And-The-CFO-Exits-at-Loss-Shares-Down-60--31920545/[4] https://www.cnbc.com/2021/05/07/stocks-us-market-us-stock-market-open-friday-news.html[5] https://www.proactiveinvestors.co.uk/companies/news/116602/metal-one-inks-share-purchase-deal-for-uranium-projects-in-us-116602.html[6] https://www.telegraph.co.uk/business/2021/05/05/dr-graham-cooley-investing-innovative-technologies-cars-distil/[7] https://www.proactiveinvestors.co.uk/companies/news/116647/seeing-machines-recovery-after-being-hit-by-headwinds-across[8] https://www.proactiveinvestors.co.uk/companies/news/116657/itaconix-shares-motor-10-higher-as-stability-in-industry-riven-by-volatility[9] https://www.proactiveinvestors.co.uk/companies/news/116686/ilika-s-battery-technology-makes-steady-progress-as-it-confirms
- Mirriad Advertising's stocks continue to plummet, highlighting the difficulties small businesses face in securing funding, especially in the finance and investing world.
- The collapse of a potential takeover has left Mirriad scrambling, with the company struggling to find an alternative to secure fresh funds and avoid going bankrupt.
- Enteq Technologies, another company facing funding woes, has brought in administrators, marking the end of the line for the drilling group.
- While these situations cast a gloomy picture, the stock-market and finance sectors show promise, with the AIM All Share rising 4% over the trading week, outperforming the FTSE 100.
- Some companies are faring better, like Metal One, whose shares continue to rise after inking a deal for uranium projects in the US.
- There's potential for growth in the business sector in 2025, with companies like Itaconix, a plant-based polymer specialist, expecting to meet their targets despite growing uncertainty over US trade policy.
