Though the volume spiked from zero to 395,000 traded shares over a day, traders were cautious and the share price added only 3.19%. The close at $0.97, which was also the highest price offered within the day, gives DYSC the chance to returns back above the $1 level.
The news about DYSC that caused the run-up on the shares yesterday appears to be the company’s annual report, filed after the market closed on Tuesday. Investors probably recognized that the market value of the stock currently does not quite correspond to the sales the company is making, which would suggest a price of at least $1.91 for a share.
DYSC had a good year for a young company, continuing the stable growth rates. The business is to provide copies of published content in electronic or paper form, main current and potential customers being the marketing departments of large companies, researchers and regulatory personal. Due to a substantial 67% increase in the customer base over the last year, revenues reached almost $25 million, a 70% increase from the previous year. But as the costs of that sales increased even more, by 73%, an operational profit of nearly $4 million was possible, but not a net profit.
As it often happens, investors must have bet on potential yesterday. DYSC also has to some extend stable financial condition and has secured a line of credit with a bank for up to $3 million in July. Positive outlooks came also from the 10-K, where the managements presents its enthusiastic future plans to get profitable soon through further client-base expansion, new products and improved service.
DYSC also plans to expand through the acquisition of other companies and states to have already three potential targets. That may sound too enthusiastic, however, although good on the long-term. The cash available so far may not be enough and the acquisitions will have to be made through stock transactions, which may dilute shareholders.
