SMALL CAP MOVERS: Are freefalling Parsley oversold?

What a difference a year makes. Parsley Box, the provider of ready meals for the baby boomer generation, came to the market by placing shares with investors at 200p, which valued the business at £84million.

Look away now if you bought stock at or just after the IPO, because the news is not good. Today those shares are worth just 11p, which represents a near 95 per cent collapse in the worth of the business.

The latest blow came on Wednesday when Parsley Box issued a trading statement, or more accurately a warning, as it cut revenue guidance amid a fall in orders in the first half.

With the shares off almost a third over the week, the group has a market capitalisation of £8.35million, or an enterprise value of just over £3million if you take off the cash it still has on its balance sheet.

For some of the more risk-savvy investors, the Parsley Box shares may now look decidedly oversold. Whether they are more appealing than one of the caterer’s shepherd’s pies or hot pots remains to be seen.

Turning to the broader market, the AIM All share index advanced 1.3 per cent over the last five trading days of July to 914.60 on lacklustre trading volumes, but kept pace with the blue chip FTSE 100.

Ince Group, the listed law firm, was the week’s biggest casualty with a 64 per cent decline after it launched an emergency fundraiser in the wake of cyber-attack in which an estimated £4.9million went missing.

The company brought in £9.1million to shore up its finances. The rump was from a heavily discounted issue of new stock, though it also received a £1.6million loan from its funding bank. Unsurprisingly, chief executive Adrian Biles is to quit.

Onto better news, which came from AI specialist Tintra whose shares shot up 58 per cent on Friday.

The catalysts was an AGM statement from the group’s chief executive Richard Shearer.

He somewhat buried the lead in his commentary, ploughing through all the historic challenges, before arriving at the headline.

The group is developing, in harness with research and investment firm Time Machine Capital 2, what it described as a ‘revolutionary’ banking platform.

Tintra said it is already six months ahead schedule, so it is going out to raise $25million for ‘not greater than 10 per cent of the company’.

If Shearer achieves that goal it would value the business at US$250million, or £205million, making a mockery of the company’s current £27million market capitalisation.

In the oil sector, Pantheon Resources was up 27 per cent over the week, and 18 per cent on the day as it hit a potential gusher on Alaska’s North Slope.

It said its Alkaid-2 well exceeded all expectations as it hit 1,400 feet of oil bearing strata. For those not in the know, that’s one heck of a discovery.

Of course, the proof will be in the well testing. And while Alaska does have oil and gas infrastructure, the conditions are difficult, and the environmental considerations are manifold. Even so, the announcement ranks as a big deal for a comparatively small explorer.

With latest share price movement, Pantheon is on the cusp of becoming a £1bn company. In early 2020 the group was trading at roughly a tenth of that value – so bravo to those who spotted Pantheon’s potential then.

You can’t mention Pantheon without also name-checking its Alaska neighbour, the Anglo-Aussie group 88 Energy.

Though it hasn’t enjoyed Pantheon’s success, 88 is still benefiting from the ‘nearology’ play with the stock up 8 per cent on Friday and ahead 44 per cent in the last month.

Finally, Active Energy Group, up 70 per cent, also had a good week, though it’s hard to see why. The biomass specialist was forced to deny it was in offer period when investment firm Close Brothers was revealed to have built a modest stake. Unperturbed, buyers appear still appeared willing to take a speculative punt.