Independent Investment column - Blinkx
Current price: 29.25p
Our view: Buy
Against a backdrop of failed IPOs and acquisition integration problems in the UK technology industry, there is one recently listed tech story that is starting to deliver on its promise.
Blinkx was spun out of Autonomy and listed on the Alternative Investment Market back in May. Despite signing up a slew of high-profile customers for its video search platform, including AOL and Ask.com, the shares have slipped to below 30p compared to a float price of 45p. Yet the latest trading statement from the company suggests it is performing well. Blinkx expects its first-half results to beat analysts’ forecasts as demand for online video continues to grow “extremely rapidly”. The company has already indexed 14 million hours of video content, and is preparing to launch a broadband TV service. Another growth avenue is its new video-based advertising system AdHoc, which it hopes will have a similar growth profile to that of Google’s dominant AdSense platform in the internet advertising market.
As with any technology company early in its product cycle, Blinkx’s valuation rests on its potential and confidence that it can execute its strategy. It has got off to a great start and a 13 per cent rise in its shares yesterday shows there is appetite for a good news story in UK technology. Buy.