Blinkx’s Value Has Soared To £158 Million; Now What?

Blinkx may have posted another loss on investment in its annual accounts in May, but the report that actual income nearly doubled has set a rocket under the video search and advertising firm’s share price.

As our chart shows, Blinkx‘s price on London’s AIM market shot up more than three times following the earnings on May 19, and in the last few days reached farther, to a record of £0.57, not seen since Blinkx’s May 2007 IPO.

It’s now valued at £158 million — back around its heady flotation value and more than four times its worth just two months ago.

What’s behind the surge… ?

Back in June, one analyst set Blinkx, led by CEO Suranga Chandratillake, a target price of £0.61, forecasting Blinkx will be making £30 million profit on £80 million revenue by 2014.

This week, big investors have splashed out heavily on Blinkx stock. The rise is exciting investors, some of whom have already made a killing, some of whom are hanging in for a sale to someone like Google (NSDQ: GOOG) (surely the old rainbow logo was for catching Mountain View’s eye?).

The period has seen more of the usual announcements from the company – new partnerships for food and history clips, and a deal to supply advertising in video from the ITN news agency packaged for Iliffe local newspapers.

Company PRs, when spoken with about a new deal to feature Blinkx’s mobile app on Samsung’s Galaxy S smartphone, actively point to the high price, along with the ITN deal and annual earnings.

So where does Blinkx go from here? Most folks believe that online video advertising is only just getting going. With over 720 content partnerships and 35 million hours of clips, Blinkx certainly already has scale. A partnership with interactive TV service Miniweb means Blinkx is poised to get those video ads on to living room TVs as well.

A Google-Blinkx tie-up is a natural fit, letting Google buy in to the fast-growing market of video ads against premium content, leapfrogging efforts to monetise the mostly amateur vids of YouTube. But we’ll see.