MIAMI — Since the abrupt and unexpected departures of both its President and CEO on the final day of March, a Sunday, media measurement and analytics company Comscore has taken a hard fall on Wall Street with its stock.
On Tuesday, the steady and punishing slide for the company’s shares seemingly reached its zenith, with a big private stock sale designed to raise millions in cash getting a negative reception from investors. A 18% slide for SCOR was logged.
On Wednesday, the severe bleeding continued.
As of 3:10pm Eastern, Comscore shares were off another 11.5% from Tuesday’s close, and trading at $5.40.
It was better than the dip to $5.31 seen at 2:06pm — but nevertheless bleak for a company seeking to reverse weeks of bad fortunes.
Volume was brisk at 891,498 shares; average volume is 358,120 shares.
However, with less than 10 minutes remaining in the trading session, SCOR stemmed its losses. As of 3:53pm SCOR was off by 7.5%, at $5.64.
Wednesday’s trading is directly in response to the private stock sale designed to raise millions in cash — and perhaps millions more.
It far overshadowed news of a significant strategic partnership for Comscore.
The key catalyst for the sharp slide for SCOR is a definitive agreement between Comscore and institutional investor CVI Investments that secures an initial cash injection in Comscore’s common stock of approximately $20 million — with the potential to increase to approximately $50 million within 12 months, in certain circumstances.
The transaction was set to close Wednesday (6/26).
CVI Investments is based in the Cayman Islands and has a portfolio value of $150.2 million and is largely comprised of health sciences and pharmaceutical companies. CVI’s investment manager is Martin Kobinger of San Francisco-based Heights Capital Management.
As the financial world turned its attention to Comscore, Daniel Newman, principal analyst and founding partner at Futurum Research, conversed via e-mail with American City Business Journals about how the CVI sale is “one of the stranger deals I’ve looked at.”
For Newman, “it reflects the desperate state that comScore is in. This is the only reason I could see comScore using this type of discounting on its stock to entice investment.”
The stock woes and investment by CVI served as a major attention deflector for Comscore and its new strategic partner, MediaScience.
MediaScience is known for its scientific, lab-based measurement of consumer interaction with media and advertising, and it is joining forces with Comscore “to provide deeper insights into how advertising works in the digital era.”
Through this partnership, Comscore and MediaScience will produce research “that addresses how and why cross-platform advertising works, and provide measurement of audience size, behavior, engagement and effect.”
In particular, Comscore and MediaScience will work together on developing thought leadership about how advertising works across different platforms; creating client-specific solutions, including cross-platform and brand integration research; and innovating the measurement of in-room attention and engagement for OTT advertising.
