Key points:
- Bidstack shares fell and then rallied higher after clarifying its Azerion contract.
- The company clarified that its agreement with Azerion had not changed.
- Investors were relieved to hear there was no ongoing litigation.
The Bidstack Group PLC (LON: BIDS) share price fell after issuing an update clarifying media reports that Azerion had taken legal action against it for its new strategy, which is focused on building its team of salespeople targeting the US market.
The company clarified that its new sales strategy would not affect its contract with Azeriion in a meaningful way, given that Azerion is a European-focused company. In contrast, its new strategy is mainly focused on the US market.
Also read: The Best Undervalued Stocks To Watch In 2022.
However, Bidstack admitted that it had received a letter of inquiry from Azerion regarding its new strategy and had replied to the same, clarifying that it does not expect its contract with Azerion to change. In addition, the two firms just recorded the highest gross sales in October, with November and December sales expected to be higher.
The company reaffirmed that its contract with Azerion was still being executed on a “business as usual” basis by both parties, and nothing had changed. In addition, Bidstack took the opportunity to remind investors that its strategy to sell directly to the Japanese and North American markets had already achieved some early success.
Bidstack added that it plans to undertake a comprehensive review of its business operations in all geographies and reassess and renegotiate some of its existing contracts to align them with its current strategy.
The in-game advertising company revealed that its Chief Revenue Officer was already progressing in discussions on several significant global revenue opportunities, including other licensors, resellers and media agreements, with final contracts expected in its 2023 financial year.
Bidstack shares had recouped all their initial losses at writing and were trading flat for the day after an initial plunge when the firm issued the press release.
So, would I buy Bidstack shares? The short answer is maybe. The company’s shares look pretty attractive at current prices after falling 45.8% this year. Moreover, the firm’s prospects make it an ideal target for investors in the gaming space.
*This is not investment advice.
Bidstack share price.
The Bidstack share price initially fell before recouping most of its losses by press time.
