The Purplebricks share price has tanked to a four-year low of 89.5p, only marginally above its January 2016 rock bottom of 74p.
Its share price has been on a downward trajectory since January this year when it peaked at £1.30p, but this began accelerating and since February 26th it has plummeted from £1.06 to its current price of 89.5p at close of play yesterday.
This drop can in part be attributed to the overall drop in the London Stock Exchange as investors, faced with the threat to business caused by the Coronavirus pandemic, have dumped riskier shares.
But equally, speculation about the company’s pricing model and finances, and some bad PR, have not helped.
As The Negotiator reported on February 21st, the company’s CEO Vic Darvey responded to analysis from industry consultant Andrew Stanton that suggested it could eventually run out of cash by saying its UK and Canadian businesses were profitable ‘at an EBITDA level’.
And yesterday The Daily Telegraph published a story that Purplebricks had banked some £18 million in fees from listings that it had not sold, claiming that it withdrew 21,380 listings in 2019 ‘as market jitters forced many buyers and sellers to stay put’, its reporter Vinjeru Mkandawire claimed.
Also, claims by many hybrid agency bosses, including Vic Darvey, that the online estate agency sector will eventually take 10% of the overall market have been frustrated by recently-published data from The Advisory, which shows it is stuck at around 4.6% of the overall market, based on Rightmove listings.