GeoOp slides to record-low as investors cautious on growth stocks
By Suze Metherell
June 27 (BusinessDesk) - Shares in GeoOp, whose software allows mobile businesses such as builders to manage their
workforce, dropped to its lowest price since listing last year, as investors shunned growth stocks in a shift to more
cautious sentiment.
The NZ Alternative Index listed stock fell 7.8 percent to $1.06, before all trading halted on the NZX due to a technical
glitch with the stock market operator, well below its debut price of $2.40 in October last year and have plunged 76
percent from its high of $4.49 in November. The company raised $10 million at $1 a share in a private offer before
listing, which it said at the time was more than three times oversubscribed.
"It's simply a reflection of a bit of caution creeping into that whole space with those tech companies," said Mark
Lister, head of private wealth research at Craigs Investment Partners. "Those sorts of stocks can power ahead pretty
aggressively when things are going well and when people are really upbeat on their prospects, but because of their
volatile nature and because they don't really have any earnings or profit behind them, when things turn cautious they
fall harder as well."
Growing geopolitical risk including increased conflict in Iraq, rising interest rates, and global markets trading at
all-time highs had investors more cautious across the world, while upcoming listings of tech-based companies had
investors pulling cash from the stocks to fund new investments, Lister said.
Xero, the cloud-based accounting software firm, rose 0.4 percent to $26 but has slipped 43 percent from its March high
of $45.99. Pacific Edge, the Dunedin-based biotech company, was unchanged at 81 cents, more than half of its February
high of $1.76. Diligent Board Member Services slipped 0.3 percent $3.98, and is 43 percent below its June 2013 high of
$7.06.
"All of those stocks which are really exciting growth stories, but at the moment aren't very profitable, are the ones
that have been star performers over the last couple of years, and have had a pull back lately," Lister said. A more
cautious tone was in the market after what had been a turbo-charged first-half, which saw the NZX 50 Index reach
all-time highs, he said.
(BusinessDesk)