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Top Defense Technologies Stocks to Watch: LMT | MRCY | BREZ | HEI | AVAV

The geopolitical climate is changing. The Russian invasion of Ukraine is the most extreme example of these changes, but it’s also just one of them. The reality is that as the geopolitical tides continue to grow choppy, spending on defense technologies is likely to grow. 

That means that while a changing geopolitical landscape may be a scary thing in some ways, it’s also an open door to opportunity for investors. 

Knowing that we’re likely to see increased spending in the defense technology sector, it only makes sense to look to the sector for strong investment opportunities. Below, you’ll find the details on five defense technologies companies to watch closely and where each of them shines. 

Lockheed Martin Corp (NYSE: LMT): Best Diversified Defense Technologies Stock

You can’t write an article about defense technologies without mentioning Lockheed Martin Corp. The company is one of the largest aerospace and defense companies in the world with a diverse portfolio of defense and other technologies to offer the United States government and aerospace industry. 

The company operates four business segments. Those include aeronautics, missiles and fire control, rotary and mission systems, and space – and has taken a leadership role in each of these four industries. The company also has partnerships, like a recently expanded partnership with Microsoft, to produce better technologies for their government clients. 

All told, LMT is a leader in its industry, produces meaningful revenue and profitability, and offers meaningful dividends. That combined with the recent declines in the stock point to a strong opportunity to benefit from a potential rebound. 

Mercury Systems Inc (NASDAQ: MRCY): Best Diversified Aerospace Defense Technologies Stock

Mercury Systems is all about aerospace technologies, both on the commercial and defense front. That’s important because while the defense sector offers stable growth, the company will also benefit as the commercial flight industry works to rebound. 

However, the core of the company may not be why you decide to dive in here. 

In January, Mercury Systems announced that it was exploring strategic alternatives. Of course, one of those strategic alternatives is the sale of the company, and there have been interested buyers and bids, one of which came from Veritas Capital. 

If the company were to be acquired, it would likely happen at a strong premium, resulting in a meaningful return of value for investors.  

Breeze Holdings Acquisition Corp. (Nasdaq: BREZ): Best Ammunition Technology Stock

Breeze Holdings Acquisition Corp. is a SPAC. The company has plenty of access to capital to make big moves and a management team that knows what it’s doing. But the real prize is the company’s acquisition target. 

Breeze Holdings Acquisition Corp. is expected to close a deal with TV Ammo (True Velocity Ammo) no later than September of this year. That’s exciting news because True Velocity is working to upgrade ammunition technology – crucial weapons technology that hasn’t seen a meaningful change since 175 years ago. 

TV Ammo has developed composite-cartridge ammunition that reduces the weight of ammunition by 30% to 32%. With soldiers carrying up to 180 pounds of ammunition into a war zone, that’s a meaningful difference that has the potential to save countless lives. 

With the closing of the deal between BREZ and TV Ammo being just around the corner, this stock should be on your watchlist. 

Heico Corp (NYSE: HEI): Best for Reduced Cost Aerospace Maintenance

Heico Corp operates in the aerospace sector. The company’s defense arm, HEICO DEFENSE works with the military to supply aircraft engines and components, batteries, and insulation products. It also assists in reverse engineering, reverse manufacturing, and repair and return services. 

Importantly, Heico focuses on reducing the cost of fleet operation and maintenance, which plays a significant role in the other arm of its business – the commercial arm. 

Although Heico is a prime provider to the United States government, it also works with a wide range of commercial aerospace companies, setting the stage for further growth as the commercial industry rebounds. 

AeroVironment, Inc. (Nasdaq: AVAV): Best Unmanned Aircraft Play

AeroVironment is a diversified defense contractor, but much of its business comes from its Unmanned Aircraft, or drone, arm. The company offers a wide range of military drones designed for a wide range of applications. 

Outside of its drone business, AeroVironment also produces unmanned ground vehicles, tactical missile systems, high-altitude pseudo-satellites, and service and support solutions.  

Analysts love the stock too. 

At the moment, three analysts are weighing in on the stock, two of whom rate it a strong buy and one who rates it a buy. The average price target is $120, suggesting the stock has room for double-digit growth. 

Final Thoughts

The defense sector is likely to see significant spending growth. Consider the stocks above as you look for opportunities to take advantage of this growth in spreading ahead. 

Article Resources

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article is not a solicitation to buy or sell any security and was designed for information purposes only. This article was written by Joshua Rodriguez and shares his true opinion, which may not be the opinion of the publication it appears on. Joshua Rodriguez holds no positions in any security mentioned herein and has no intentions of opening positions within the next 72 hours. This publication was sponsored by Global Advertising Agency and should not be considered investment advice. Trading and investing in stocks involve risk. CNA Finance suggests you speak with your personal financial advisor or investment advisor before making any investment decisions. 

The Best Gun & Ammo Stocks to Watch: SWBI | BREZ | RGR | VSTO | POWW

The global ammunition market was worth about $26 billion in 2022 and it’s growing quickly. Some experts suggest that ammunition will continue growing at a 4.3% compound annual growth rate to become a $39.1 billion market by 2032. 

Of course, several players are in the market, some that have been around for quite some time while others are relatively new. With so many options, it can take time to decide which gun and ammo stocks are worth watching. Find some of the most intriguing options on the market below.  

Smith & Wesson Brands Inc (Nasdaq: SWBI): A Clear Undervaluation

Smith & Wesson is one of the most trusted gun and ammunition brands in the world. If you’re a firearm enthusiast chances are you’ve had at least one experience with the brand. It turns out that this isn’t just a popular brand, there’s a strong argument that the stock is undervalued. 

Just look at its P/E ratio. 

At the moment, SWBI trades with an 8.27 P/E ratio. At the same time, the average P/E ratio for the industry is 10.37, suggesting the stock is pretty cheap. 

It’s also worth noting that the share price is pretty stable. That means that while it may take some time for the stock to catch up to its peers, once it does, there’s little chance of finding it at a discount any time soon. 

Breeze Holdings Acquisition Corp. (Nasdaq: BREZ): A SPAC to Consider

Breeze Holdings Acquisition Corp. is a SPAC with its crosshairs set on TV Ammo, Inc. (True Velocity Ammo). TV Ammo is in the process of updating a technology that’s been the same for nearly two centuries – ammunition. 

Today’s brass casings on ammunition are essentially the same as they have been for the past 175 years. TV Ammo is changing that with its proprietary composite-cased ammunition. 

The company’s ammunition is 30% to 32% lighter than its brass-cased counterparts and significantly more accurate. Designed for military use, this ammunition may be the key to bringing more soldiers home than ever before. 

At the same time, the company recently entered into a deal that will bring its products into Bass Pro Shops across the country – setting the stage for a compelling consumer-focused opportunity.

BREZ expects to complete the acquisition of TV Ammo by late August. So, keep your eyes peeled.  

Sturm Ruger & Company Inc. (NYSE: RGR): An Earnings Growth Story

If you’re looking for gun and ammunition stock with plenty of potential for earnings growth ahead, look no further than Sturm Ruger & Company – another of the most trusted brands in guns and ammo. 

The company has been retaining about 61% of earnings over the past three years and reinvesting those earnings in the business, and doing so with a high level of profitability. As a result, the stock has produced strong earnings growth.  

There’s no sign that the company’s strategy with regard to earnings retention and growth will change anytime soon, suggesting that RGR could be a strong growth play ahead. 

Vista Outdoor Inc. (NYSE: VSTO): The Market May Be Wrong

Vista Outdoor has taken a hit over the past year, but that may prove to be a good thing. The stock looks to be bouncing back and may have plenty more room to run. So, the bears in the market that have put pressure on the stock may be wrong. 

The truth is that Vista Outdoor has been investing heavily back into its company, which has led to pretty impressive earnings growth. Although some forecasts suggest that earnings growth may slow ahead, the company’s diversification into just about every arm of the outdoors industry will likely ensure that any lull in earnings growth will be short-term. 

Ammo Inc (Nasdaq: POWW): A Meaningful Ownership Mix

Ammo Inc has the potential to see significant growth ahead and one of the best ways to see it is to simply look into who owns shares in the company. Here’s a quick breakdown:

  • Institutional Investors: If you want to know how to make money in the market, start to follow the institutions. Institutional investors make up 17% of POWW shareholders with institutions like BlackRock being one of the company’s largest shareholders. 
  • Insiders: Ammo’s insiders are firm believers in what they’re doing too. In fact, insiders currently own more than 31% of the company. That means management’s interests align well with investors because those leading the company are investors. 

When you dig into the fundamentals, you’ll quickly find that there are good reasons firms like BlackRock are behind POWW, and considering the alignment of interests between management and shareholders, this is a hard stock to ignore. 

Final Take

If you’re looking for opportunities to take advantage of the rising price of and demand for ammunition and firearms, consider looking into the stocks listed above. As always, keep in mind that investing comes with risk and you should speak with your certified investment professional before making any investment decisions. 

Article Resources

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article is not a solicitation to buy or sell any security and was designed for information purposes only. This article was written by Joshua Rodriguez and shares his true opinion, which may not be the opinion of the publication it appears on. Joshua Rodriguez holds no positions in any security mentioned herein and has no intentions of opening positions within the next 72 hours. This publication was sponsored by Global Advertising Agency and should not be considered investment advice. Trading and investing in stocks involve risk. CNA Finance suggests you speak with your personal financial advisor or investment advisor before making any investment decisions. 

Top Defense Stocks to Watch: RKLB | RTX | BREZ | GD | BWXT

Defense stocks are a staple in many investment portfolios and for good reason. With the United States and other governments as customers, they offer a level of security not found otherwise in the market. 

So, it’s not surprising that you’re looking for the best defense stocks for your watchlist. 

I’ve found five stocks in the category that are worth keeping a very close eye on. Read on to learn more about them. 

Rocket Lab USA Inc (Nasdaq: RKLB): Human Space Flight Is in the Cards

Rocket Lab may be the last company you expected to see on a list like this. The company has significantly underperformed when compared to the overall market, but that may prove to be an opportunity, and I’m not the only person that sees it that way. 

RKLB currently has an average price target of $8.32, representing the potential for more than 100% gains ahead.

As its name suggests, Rocket Lab is an aerospace and defense company. It’s working on the Neutron rocket for manned missions to space and has plenty of money in the bank to complete that work. The company also completed five successful commercial launches and four successful government launches of its electron rocket in 2022. Not a single launch was a failure!

All told, the stock looks to be clearly undervalued, and an opportunity for significant growth ahead. 

Raytheon Technologies Corp. (NYSE: RTX): A Defense Powerhouse 

What would an article about defense stocks to watch be without mention of Raytheon Technologies? The company was created by a merger between Raytheon and United Technologies. These companies stood well on their own, but together, they’re a force to contend with. 

At the moment, the company is in a prime position to take advantage of increased defense spending. 

The government is expected to buy more next-gen aircraft, missiles, munitions, and more, and Raytheon Technologies is one of the first places it will look to do so. Aside from the growth led by government purchases, the company is also likely to benefit greatly from growth in the commercial aerospace sector. No matter where you look, Raytheon Technologies is hard to ignore. 

Breeze Holdings Acquisition Corp. (Nasdaq: BREZ): Reducing Casualties by Reducing the Weight of Ammunition

Next on the list is a company you likely haven’t heard of, but it’s worth taking a look. Breeze Holdings Acquisition Corp. is a SPAC that has nothing to do with defense quite yet. But that’s all about to change. 

The company is expected to close a deal with TV Ammo (True Velocity Ammo), a defense technology company that’s making serious waves in the ammunition space. The company’s claim to fame is composite-cased ammunition that’s 30% to 32% lighter than traditional ammunition. That’s a huge advantage on the battlefield. 

Not to mention, the company signed a partnership with Bass Pro Shops that will lead to the company’s ammunition being sold in stores across the country. 

Sure, this is an early play, but the early bird gets the worm. 

General Dynamics Corporation (NYSE: GD): Strong Revenue Growth Ahead

General Dynamics is another defense powerhouse that’s likely to benefit greatly from the government’s increased defense spending. In fact, some suggest that the company will sell 170 aircraft to the government this year for delivery in 2024. This includes 138 large craft and 32 midsized airplanes. 

As a result of the continued growth in government spending, General Dynamics’ revenue is expected to climb by nearly 5% in 2023. 

It’s also important to keep in mind that aircraft isn’t the only thing the company does. It also has significant marine segment and technology segment sales that are expected to continue growing.

BWX Technologies Inc (NYSE: BWXT): Keeping the Fleet Moving

BWX Technologies lives on a different side of defense. They don’t make the craft used by our military or sell ammunition and weapons systems. Instead, BWXT is focused on the provision of nuclear reactors, fuel, and services that keep submarines and carriers operational. 

The company has seen strong growth due to its microreactor technologies and uranium processing, and that growth isn’t expected to slow any time soon. 

Not to mention, the stock is a strong play for recession-proofing your portfolio. After all, the company is focused on naval operations, nuclear energy, and medicine – three industries that don’t necessarily ebb and flow with economic developments. 

Final Thoughts

The defense sector is riddled with opportunities. That’s especially the case as global tensions continue to mount and the threat of recession leads investors to adjust their portfolios. If you’re looking for strong defense plays, dive into the stocks mentioned above – but remember to do your own research and speak with your financial advisor or certified financial planner before making an investment decision. 

Article Resources:

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article is not a solicitation to buy or sell any security and was designed for information purposes only. This article was written by Joshua Rodriguez and shares his true opinion, which may not be the opinion of the publication it appears on. Joshua Rodriguez holds no positions in any security mentioned herein and has no intentions of opening positions within the next 72 hours. This publication was sponsored by Global Advertising Agency and should not be considered investment advice. Trading and investing in stocks involve risk. CNA Finance suggests you speak with your personal financial advisor or investment advisor before making any investment decisions. 

Breeze Holdings Acquisition Corp. (BREZ) Stock: A SPAC You Don’t Want to Miss

Lately, I’ve taken an interest in SPACs, or Special Purpose Acquisition Companies. Also known as blank check companies, SPACs pool money from a wide range of investors and use that money to acquire companies and assets in what amounts to take-public transactions. 

In my research of current SPAC opportunities, I came across Breeze Holdings Acquisition Corp. (NASDAQ: BREZ). The company has an impressive C-suite and plenty of access to capital to play ball, but let’s face it, the SPAC is all about the acquisition target – which is what makes this company so interesting to watch. 

BREZ Plans to Acquire TV Ammo, Inc. 

In a press release issued in November 2022, Breeze Holdings Acquisition Corp. announced plans to acquire TV Ammo, Inc., also known as True Velocity or True Velocity Ammo. So, what’s the TV Ammo story?

The company launched its business with the goal of improving upon the tools available to the United States military through the use of cutting-edge technologies. The company did so by producing a lightweight composite-cased ammunition solution. 

What’s the big deal?

Lower Cost of War in Terms of Casualties & Dollars

When our soldiers walk, fly, or drive into battle, they carry a significant amount of weight with them. Much of that weight is in the form of brass-cased ammunition. Increased weight means slower movement for those on foot and an increased need for fuel for ground and air assets. Ultimately, a heavier load means fewer soldiers make it home to their families while more money is spent on fuel for battle. 

That’s where composite-cased ammunition comes in. True Velocity ammunition is between 30% and 32% lighter than its brass-cased counterparts, depending on the type of ammunition you compare. That means that for every 100 pounds of ammunition a soldier has to carry around, TV Ammo takes between 30 and 32 pounds off his shoulders. 

Not to mention, TV Ammo’s rounds are proven to be more accurate than traditional brass-cased ammunition, further increasing our soldiers’ ability to make it back home. 

Relieving Brass Supplier Dependency

There’s no question that the world is changing before us. Superpowers around the world continue to vie for power and the threat of war is ever-present. That’s a problem if we can’t get our hands on brass. 

For the past 175 years, every shell casing used by the United States military has been a brass casing. So, it’s important to consider the suppliers of this key metal. 

Brass is a derivative of copper. If you look into the world’s leading copper producers, you’ll find that many of them are direct adversaries of the United States. Many of those that aren’t direct adversaries of the United States are controlled by direct adversaries of the United States. 

This means that in a worst-case scenario, we could face real difficulties getting our hands on the brass needed to sustain a war if one were to break out. 

True Velocity solves this problem. 

The company’s composite-cased ammunition is manufactured in Texas and doesn’t require any basic materials from anywhere other than the United States. 

This Is Just the First Step

At the moment, True Velocity is focused on ammunition, but you have to imagine that’s not going to be where they start. The company was able to make significant strides in a technology that hasn’t been updated in over 175 years, ammunition. In doing so, it has the potential to reduce casualties on the battlefield. 

If the company was able to reduce ammunition weight by 30% or more, one can only imagine what technological innovations will come out of the team next – with each one making life easier for our soldiers. 

The Deal Happens Soon

By August of this year, Breeze Acquisition Holdings Corp. will close the deal with TV Ammo, bringing TV Ammo to the public market at around a $1.2 billion valuation. As a result, there’s an opportunity right now to get in on the ground floor in a SPAC that has the potential to make big things happen for your portfolio and our military. 

Article Resources:

https://www.bitchute.com/video/pzpep7UPIWDO/

https://www.sec.gov/Archives/edgar/data/1817640/000121390022068368/ea167835-425_breezehold.htm

https://www.globenewswire.com/en/news-release/2022/11/01/2545238/0/en/Breeze-Holdings-Acquisition-Corp-Announces-Definitive-Agreement-to-Merge-with-TV-Ammo-Inc.html

https://news.spacconference.com/2023/03/06/breeze-holdings-acquisition-files-proxy-to-extend-deadline-on-tv-ammo-deal/#:~:text=Breeze%20in%20November%20announced%20plans,and%20trade%20on%20the%20Nasdaq

https://en.wikipedia.org/wiki/List_of_countries_by_copper_production

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article is not a solicitation to buy or sell any security and was designed for information purposes only. This article was written by Joshua Rodriguez and shares his true opinion, which may not be the opinion of the publication it appears on. This is a sponsored publication for which CNA Finance received compensation. Trading and investing in stocks involve risk. CNA Finance suggests you speak with your personal financial advisor or investment advisor before making any investment decisions. 

Camber Energy (CEI) Stock: What an Opportunity! 

Yesterday was a rough day for Camber Energy (NYSEAMERICAN: CEI), with the stock falling 3.70% by the closing bell – but that’s good news. I know, you’re probably thinking, “Josh, you’re crazy, nothing about CEI stock falling is good news,” but I’m here to tell you otherwise. After all, yesterday’s declines only expand the potential opportunity. 

The Viking Energy Merger Is Coming

I’ve written two articles about the fact that the storm clouds hanging over the merger between Camber Energy and Viking Energy have dissipated. So, I’m not going to spend too much time here. The simple fact is that this merger is likely to take place – and soon. If you’d like more details as to why I believe the merger is a no-brainer, click here and/or here.   

Today, we’re going to focus on what this merger means for shareholders. 

So, What Does the Merger Mean for Camber Energy Shareholders?

The merger between Viking Energy and Camber Energy is great news all around – especially when you dig into the financials. Let’s start with one of the most important numbers, shareholders equity. 

To determine shareholders equity, you need to subtract a company’s liabilities from the value of its assets owned. The remainder is equity, much like your home’s equity is determined by subtracting the amount of money you owe on your mortgage from the total value of your home. 

When it comes to Camber Energy, shareholders equity was about -$17.12 million as of December 2022, which included an approximate $7.6 million derivative liability component associated with Camber’s remaining Series C Pref. Stock which is a fraction of the previously outstanding amount Viking Energy’s shareholders equity was positive as of December 2022, meaning on the closing of the merger Camber’s negative equity will be a thing of the past. Further, as the remaining Series C Pref. Stock is extinguished the derivative liability component will decrease, thus increasing Camber’s shareholders equity.

The difference in revenue is also monumental. 

In 2022, Viking Energy produced about $24 million in revenue while Camber Energy produced about $597,260. During the year, Camber lost about $11.16 per share while Viking’s loss was just $0.13 for the year. So, losses are likely to shrink drastically, and with the combined assets and capabilities, the two companies may be able to squeak out a profit in the near-to-mid term. 

The Bottom Line

The bottom line here is simple. All signs suggest the merger investors have been waiting for between Camber Energy and Viking Energy will be taking place within the coming months. When this happens, CEI, the surviving company, will have plenty of shareholders equity on its books, revenue worth writing home about, and a path to profitability with far fewer bumps in the road. That’s enough to excite just about any investor!

Article Resources

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article was written by Joshua Rodriguez and expresses his personal opinion of Camber Energy but should not be construed as a solicitation to buy, sell, or otherwise trade any specific security. This is a sponsored article and should not be considered investment advice. Investing comes with risk and CNA Finance strongly advises investors to seek advice from licensed professionals before making any investment decisions. 

Camber Energy (CEI) Stock: Are You Watching Yet?

I recently did a bit of digging into Camber Energy Inc (NYSEAMERICAN: CEI) and apparently, I wasn’t the only one that saw a potential opportunity. A report from Robert Goldman, Senior Analyst at Goldman Small Cap Research surfaced last week, with a price target suggesting the stock could see significant growth. 

Robert Goldman Gives CEI a $2.75 Price Target

In the research report, Mr. Goldman laid out a strong argument that Camber Energy shares could climb to $2.75 within the next two to three quarters. The argument centered around a coming merger, diversification, an outdated opinion of the stock, and revenue expectations. Find the details of each below. 

Camber to Merge With Viking… Soon

Two years ago, Camber Energy announced it would merge with Viking Energy Group Inc. (OTCMKTS: VKIN). Unfortunately, bad news struck, leading to a long-term delay in the closing. However, Robert Goldman expects the deal to finally come to a close later this year. In fact, Goldman and his team believe the deal could close as soon as the third quarter of this year. 

Diversification

Robert Goldman also pointed out that Camber Energy has impressive diversification in its assets and operations. In fact, one of the highlights from the report reads:

“The Company is one of the most diverse equipment services companies in the energy and industrial segments. This diversification includes custom energy and power systems and services, clean energy technology, and interests in oil and gas interests.”

Potential Significant Undervaluation

In the report, Robert Goldman and his team point out that the proposed merger between Camber and Viking has taken some time. With two years of back and forth, investors have been frustrated, driving the price down and keeping valuations low. 

However, the closing of the merger could change this. In fact, once executed, the deal opens the door to a pipeline of new business and merger and acquisition opportunities. As a result, if it does close in the next six to nine months, shares of CEI could go sharply higher. 

Meaningful Revenue Ahead

The team at Goldman Small Cap Research performed full-year preliminary pro forma revenue forecasts for the combined company. According to their forecast, the company should produce around $31 million in revenue in 2023 and $42.2 million in revenue in 2024, excluding any new acquisitions. Not only is that impressive considering the company’s market cap is just over $34 million, but it also suggests that revenue will grow more than 36% from 2023 to 2024. 

The Bottom Line

The bottom line is simple. If Robert Goldman and other experts are right, Camber Energy has the potential to see serious movement for the top in the near term. If you’d like to read the full Goldman report, click here

Article Resources

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article was written by Joshua Rodriguez and expresses his personal opinion of Camber Energy but should not be construed as a solicitation to buy, sell, or otherwise trade any specific security. This is a sponsored article and should not be considered investment advice. Investing comes with risk and CNA Finance strongly advises investors to seek advice from licensed professionals before making any investment decisions. 

Camber Energy (CEI) Stock: Merger Closing Could Be Around the Corner

In February of 2021, Camber Energy Inc (NYSEAMERICAN: CEI) and Viking Energy Group Inc (OTCMKTS: VKIN) announced a coming merger. The merger was great news. Camber already owned the majority of Viking Energy and considering the synergies and growth of Viking, the merger was sure to bring CEI to the next level. It was great for Viking too. Through the merger, the OTC stock would find its way to a major exchange – opening the door to fundraising opportunities nonexistent on the OTC. Things were looking up. 

That is, until the United States Securities and Exchange Commission (SEC) had questions about Series C Preferred Shares. In a nutshell, these shares were somewhat toxic. They gave the holders the ability to dilute the stock heavily – something that’s never good news for shareholders. 

So, if Series C Preferred Shares set the stage for heavy dilution, why am I even talking about CEI? Well, the times are changing and the opportunity is quickly becoming one that I believe is hard to ignore. 

Toxicity Is Largely Alleviated & the Merger Is Likely Ahead

If there’s one thing I want to get across in this article, it’s simple:

The dark cloud that’s been hanging over the Camber Energy/Viking Energy merger for about a year and a half has dissipated, setting the stage for bright sunny skies ahead.

As mentioned above, the merger between Camber Energy and Viking Energy had been delayed as the result of shares that seemingly amounted to convertible debt with no floor. That’s painful, but that seems to be over. 

Well over 90% of the shares that halted the merger and threatened dilution have been taken off the books since the announcement of the acquisition. As a result, significant dilution seems to be a thing of the past for Camber and I’d be surprised if the merger didn’t go through in the next few months. 

What Does All This Mean for the Stock?

This is where things get very interesting in my humble opinion. Camber hasn’t had the best of times in the market through the delay of the merger and the dilution that followed in an effort to get out from under the toxic shares, for lack of a better way of saying it. YTD, the stock is down over 35% and over the past year, it’s given up more than 90% of its value. 

However, this has the potential to be a good thing.

Essentially, CEI’s merger delay and subsequent shedding of relatively toxic shares resulted in the stock’s value divebombing – creating a significant undervaluation. Over the past year and a half, a dark cloud hung over the stock, keeping CEI down and striking fear in investors – investors who continuously fled the ticker. 

Now, we have a situation where the company is nearly ready to close a transformative acquisition, but it’s still trading as if it never worked to get rid of those toxic shares. That creates an opportunity. 

The way I see it, when the public realizes the work CEI has done and the fact that the Viking merger is likely to close ahead, the stock is likely to push toward a more reasonable valuation – meaning significant growth could be ahead. 

Why This Merger Is Important

The merger between Camber and Viking brings significant value to Camber shareholders. That’s because much of the company’s value is already derived from its majority ownership in Viking. Combining the two companies only makes sense. But what exactly is Viking and where does that value come from?

Viking Energy has four divisions:

  1. Power Solutions & Clean Energy. Viking Energy’s majority-owned subsidiary, Simson-Maxwell, Ltd. is a leading manufacturer and supplier of power generation products, services, and custom energy solutions. The company has been operating for more than 80 years and currently services over 4,000 maintenance contracts. 
  2. Waste Treatment System Using Ozone. Viking also owns a cleaner, more sustainable way to get rid of waste for clients like laboratories, hospitals, and the military. 
  3. Open Conductor Detection Technology. Viking Protection Systems, LLC and Viking Sentinel Technology, LLC, two majority-owned subsidiaries of Viking Energy Group, own the intellectual property rights to fully developed, patent-pending, ready-for-market proprietary Electrical Transmission and Distribution Open Conductor Detection Systems. 
  4. Resources. Finally, Viking, through majority-owned subsidiaries, owns interests in oil and gas resources in the U.S..

The Bottom Line

The bottom line here is simple. Camber Energy has been battered in the market over the past year and a half or so. However, the dark clouds are becoming a thing of the past and it seems as though brighter skies are ahead as the heavy dilution weighing on the stock has largely been lifted the merger between Camber and Viking finally seems to be coming to a close. 

Article Resources

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article was written by Joshua Rodriguez and expresses his personal opinion of Camber Energy but should not be construed as a solicitation to buy, sell, or otherwise trade any specific security. This is a sponsored article and should not be considered investment advice. Investing comes with risk and CNA Finance strongly advises investors to seek advice from licensed professionals before making any investment decisions. 

SOBRsafe (SOBR) Stock: Breaking into the Telematics Industry

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I’ve been following SOBRsafe (NASDAQ: SOBR) for about a month now, and what a month it has been. In the most recent news, the alcohol detection company announced a new hire who will make it possible to hit the ground running in the telematics industry. 

What Is the Telematics Industry?

Telematics is all about the high-speed, long-distance transmission of data. This technology is how we monitor vehicles and equipment through onboard diagnostics and GPS technology. 

Think of telematics as the brain of a vehicle. A technology that reports everything from speed to tire pressure, when the vehicle is idling, fuel levels, and more. SOBRsafe has the potential to add another layer of data to this mix – alcohol detection data. 

Imagine a long-distance truck driver getting behind the wheel after lunch. But while at lunch, that driver consumed four alcoholic beverages. Currently, there’s no way for the owner of the company the driver works for to know that the driver is likely impaired. However, with SOBRsafe, that all changes. 

How Big Is the Telematics Industry?

The telematics industry is a massive one. In fact, in 2023, telematics companies are expected to produce a combined $8 billion in revenue. Moreover, the fleet telematics industry is expected to grow by 3.1% in 2023 alone. 

As an investor, I enjoy looking at industry sizes to determine what opportunities represent. Of course, I’m not under any misconception that SOBRsafe will earn 100% telematics market share, but it is nice to know that the company can generate millions of dollars in annual revenue by controlling a very small slice of this industry. 

How SOBRsafe Is Breaking into Telematics

In a press release issued Thursday of last week, SOBRsafe announced that it hired Chris Burton as its Director of Commercial Development. This hire is the catalyst for the company’s ability to break into telematics. 

That’s because Chris has worked in the industry for more than 15 years, with significant success to report. Over the years, he’s developed strong relationships with leaders in the industry. In fact, Chris currently has relationships with several original equipment manufacturers (OEMs). Those include Daimler, Freightliner, Continental, and Thomas Built Buses. As you can imagine, Chris will leverage his relationships in the industry to expand sales.

So, what does that mean for SOBRsafe? Just consider the fleet sizes of these companies. 

  • Daimler: Daimler currently operates more than 85,000 vehicles across 13 countries. 
  • Freightliner: Freightliner operates more than 175 locomotives across the United States. 
  • Continental Automotive: Continental Automotive is a fleet management company. 
  • Thomas Built Buses: Thomas Built Buses produces about 15,000 vehicles annually. 

Considering this information, the opportunity for SOBRsafe here is tremendous. Imagine every Daimler, Freightliner, and Continental vehicle being equipped with SOBRsafe technology. Think about the growth that could come if Thomas Built Buses were to incorporate SOBRsafe technology in the buses they produced moving forward. 

Relationships with these companies have the potential to send SOBRsafe revenues flying. 

The Bottom Line

The bottom line here is simple. SOBRsafe is executing tremendously and is likely to continue doing the same considering the fact that the company is bringing Chris on board. Breaking into telematics has the potential to produce significant revenues ahead. 

Article Resources

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article was written by Joshua Rodriguez and expresses his personal opinion of SOBRsafe but should not be construed as a solicitation to buy, sell, or otherwise trade any specific security. This is a sponsored article and should not be considered investment advice. Investing comes with risk and CNA Finance strongly advises investors to seek advice from licensed professionals before making any investment decisions. 

Short Squeeze: What Is It & How to Spot It

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Short squeezes were made popular as meme stocks like AMC Entertainment Holdings (NYSE: AMC) and GameStop Corp. (NYSE: GME) made dramatic runs for the top in 2021. These are far from the first short squeezes in history and haven’t been the last either. 

Below, we’ll talk about what a short squeeze is, some of the biggest short squeezes that have taken place in history, and how to spot one of these events on the horizon. 

What Is a Short Squeeze?

A short squeeze is a market phenomenon that takes place when a heavily shorted stock moves up in value. Traders with short positions buy to cover, resulting in a tremendous run for the top. Here’s how it works:

  • The Short Sellers: Short sellers are traders who believe the stock is going to fall in value. To take advantage of this prediction, they borrow shares and sell them into the market immediately. When the stock falls, they repurchase the shares to return them, making the spread (difference between the selling price and buying price) as profit. 
  • The Stock: The target stock in a short squeeze is one that’s heavily shorted. That means more than 20% of the stock’s public float is sold short. 
  • The Big Move: The company announces positive news or traders believe the stock has reached the bottom, leading to an increase in value. Short sellers start to lose money as the stock goes up. 
  • The Short Seller Reaction: In an attempt to stop the bleeding, the short sellers purchases shares in the open market to close their positions. This leads to a high volume of buying – sending the stock screaming for the top. 

Short squeezes typically lead to gains of more than 20% but have been known to cause stocks to more than double.  

How Public Float Plays Into Short Squeezes

A stock’s public float is the number of shares that are in the hands of investors rather than officers, directors, and those with controlling interests. As mentioned above, stocks don’t have a heavy short interest until at least 20% of the public float is sold short. When good news happens, short sellers race to cover, causing a short squeeze. 

However, if you could find a stock that has a small public float and is primed for a short squeeze, you may be in for significant gains. 

That’s because the market is a system of supply and demand. As the law suggests, prices decline when supplies are higher than demand. On the other hand, when supplies are lower than demand, prices rise. Think of a stock’s public float as its supply count. 

During a short squeeze, demand for a stock climbs tremendously as short sellers race to cover their positions. If the target stock has a small float – less than 10 million shares available to the public – stringent supply could lead to the stock doubling in value or climbing even higher. 

Short Squeeze Examples

Two of the best-known examples of short squeezes are GameStop and AMC Entertainment. In early 2021, traders worked together in an attempt to push institutional short sellers out of multiple big names in the stock market. 

From January 8th, 2021 to January 29, 2021, GameStop shares climbed from under $5 per share to more than $81 per share. The movement was so dramatic that social media participants were creating memes about the event – leading to an entirely new category of stocks – meme stocks. 

AMC experienced a series of short squeezes from January 8th, 2021 to June 18, 2021. In that time period, the stock had climbed from $2.14 per share to a high of $59.26 per share. As mentioned above, these are some of the most popular examples of short squeezes, but they’re far from the only short squeezes in history. 

Short Squeezes Throughout History

  • Piggly Wiggly: One of the first big short squeezes in history happened in 1923, when traders started to short Piggly Wiggly. The company’s founder, Clearance Saunders, used his own money to purchase shares. He also worked with bankers to raise $10 million and purchase all but 1,128 shares of the company. The stock climbed by around 50%. Short sellers used the remaining public float to cover their positions and the NYSE permanently stopped all trading of the stock. 
  • Volkswagen: In October of 2008, Porsche announced that it owned a 74% stake in Volkswagen. At the time, short interest was relatively high on Volkswagen’s stock. On the day of the announcement, shares opened at €348 and closed at €517. The stock found its top at €999 per share the following day. 
  • Reliance Industries

Pros & Cons of Trading Short Squeezes

There are several pros and cons associated with trading short squeezes. Some of the most pressing are outlined below. 

Pros

The biggest pros associated with trading short squeezes include:

  • Massive Potential Earnings: Short squeezes are known for causing stocks to make a tremendous run for the top. All short squeezes result in short-term gains well over 10%, but many result in gains in the hundreds of percentage points – but keep in mind that these gains are typically short-lived. 
  • Excitement: Let’s face it. Most aspects of investing are relatively boring. However, when you see a stock flying like it’s got a pair of twin rocket boosters behind it, it’s a pretty exciting occurrence. So, trading short squeezes can be an exciting event. 
  • Easy to Spot: Finally, short squeezes are typically very easy to spot. Simply flind a few active stocks that are making tremendous runs, look for short interest, and strike on the stock that is indeed a short squeeze. 

Cons

Although there are plenty of reasons to start looking for short squeezes to trade, there are also some significant cons to consider before you start. Some of the most pressing include:

  • Impossible to Time: Short squeezes cause stocks to rise to ridiculous levels. However, it’s almost impossible to time when these stocks are likely to fall back down. As a result, many less-than-experienced investors take significant hits as the short squeeze ends. 
  • Risk: Because it’s impossible to time the reversal here, short squeezes are some of the riskiest events to trade. So, if you’re risk averse, this isn’t an option for you. 
  • Short-Lived: Short squeezes are typically a short-term event. So, you’re not going to make any serious long-term gains trading these events. In fact, if you jump in on a short squeeze and hold the stock for the long term, chances are you’ll lose and it will take a significant amount of time to recover. 

How to Spot a Short Squeeze

Spotting a short squeeze is relatively simple. Here’s how it’s done:

  1. Find Active Stocks: Use your favorite stock screener to find the most active stocks on the market. You can use Stock Twits or a number of other resources for this. While you look for stocks, specifically look for those that are experiencing more than 10% gains.  
  2. Look Into Short Interest: In order for a short squeeze to occur, there must be heavy short interest on the stock. So, look into short interest and ensure that it’s over 20%. If it is, there’s a good chance that the significant upward movement is likely the result of a short squeeze. 
  3. Trade the Squeeze: You’ve found a short squeeze. Now, it’s time to use your chart and the technical data within it to trade the squeeze. 

How to Predict a Short Squeeze

Predicting a short squeeze is slightly more difficult than finding one that’s already active, but it’s not impossible. Here are the steps:

  1. Find Heavily Shorted Stocks: Use a stock screener to find stocks with short interest that’s over 20%. After all, you need heavy short interest in order for a short squeeze to take place. 
  2. Look for Coming News: In most cases, a positive catalyst (positive news) starts the upward movement in short squeeze stocks. So, consider what news may be on the horizon. For example, did you find a biotechnology company with heavy short interest? Do they have a PDUFA date on the horizon?
  3. Assess the Possibilities: Now, it’s time to consider what the probability of positive news might be. For example, if the biotech company with the PDUFA date on the horizon recently had a meeting with the FDA that went well, there’s a highly likelihood their drug will be approved. That’s good news for a potential short squeeze. 
  4. Wait: Never start trading a short squeeze before it happens. Instead, wait to confirm your findings. Once the squeeze starts, you should have plenty of time to capitalize on the trade. 

Final Thoughts

Short squeezes are an interesting phenomenon in the stock market. Not only are they exciting to trade, they have the potential to yield significant returns. On the other hand, they typically come with high risk. So, only trade these events if you have a detailed understanding of technical analysis and how to trade fast-paced moves in the stock market. 

Article Resources

SOBRsafe (SOBR) Stock: 2022 Was Impressive | 2023 May Be More So

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I introduced SOBRsafe™ (NASDAQ: SOBR) to the CNA Finance community recently because I was interested in the company’s technology and how it may save the US economy billions of dollars each year in spending on alcohol-related accidents. 

As I continue to dig deeper into the company, I’m becoming more and more impressed with the opportunity it represents. Much of this excitement hit when I came across the company’s 2022 recap. 

SOBRsafe Is Delivering in a Big Way 

There’s no question that SOBRsafe made significant progress from a financial and operational standpoint in 2022. Find a breakdown of both below.

SOBRsafe Financial Progress

Since its uplist to the NASDAQ in June 2022, SOBRsafe has raised $19.5 million resulting in total paid-in capital since 2019 of $25 million. As a result of the company’s fundraising efforts, it has enough money on hand to execute on its goals through 2023 and moving into 2024. 

SOBRsafe Operational Progress

The company is also impressive from an operational standpoint. Since it was listed on the NASDAQ, the company has entered the early stages of revenue generation, building a book of six paying clients and entering into agreements with 9 distributors. As a result of these agreements, the company now has access to well over 50,000 potential customers. 

SOBRsafe also took part in 10 alcohol and drug detection-related conferences, conducted thousands of product demonstrations, and collected more than 600 leads. 

However, what I find most interesting is that the company doubled its sales staff. That’s exciting news as SOBRsafe actively works to turn the leads it has generated over the year into sales. 

What Is SOBRsafe?

SOBRsafe is a technology company that has developed two devices in the alcohol detection space:

  • Stationary Device: The first device is a small one that looks like a computer mouse with two sensors. One is a biometric reader to verify identity, while the other analyzes the vapor emitted from the user’s finger to determine the absence or presence of alcohol. 
  • Wearable Device: The company has also developed a wearable device that looks somewhat like a fitness band. When someone wears the device on their wrist, it employs the same alcohol detection technology, but with continuous monitoring and both GPS tracking and band removal alerts. 

For more information on SOBRsafe, check out the first SOBR article I posted. 

Why This Technology Is Important

I touched on the fact that SOBRsafe got my attention because it was solving a problem that costs the United States economy billions of dollars per year. However, it’s hard to see just how important this technology is without diving into the numbers. 

Alcohol abuse results in $70 billion in costs to the United States economy between crashes, increased healthcare costs, and justice department needs each year. That’s staggering enough but it’s not the end of the story. Alcohol abuse also leads to $179 billion in workplace productivity losses each year. 

All told, the United States Centers for Disease Control (CDC) suggests that excessive alcohol use costs the United States economy $249 billion annually – that’s just shy of a quarter trillion dollars! 

Of course, no single solution is going to cut that cost completely, but SOBRsafe has the potential to make a significant dent in it. Companies who take advantage of the technology to ensure their employees aren’t under the influence while on the job won’t experience the extreme losses other companies might. 

Moreover, the technology has already been proven to reduce insurance rates, which in many cases means it pays for itself. 

Building Residual Revenue

SOBRsafe’s revenue model is hard to ignore. The company has built a system that allows it to generate revenue from the sale of its technology, but its primary focus is a SaaS subscription service that’s likely to generate substantial residual revenue ahead. Here’s how their revenue model works:

  • Device Revenue: Companies pay $600 for each stationary device they purchase and $450 for each wearable device they purchase. 
  • Residual Revenue: Once they’ve purchased the devices, companies also pay $30 per user per month. This fee connects the device to the Internet of Things making it possible for employers to track data and act on-demand when the technology detects the presence of alcohol. 

The Bottom Line

The bottom line here is simple SOBRsafe is the first to market with a touch-based alcohol detection system. The company’s technology has the potential to put a significant dent in the massive $249 billion economic loss excessive alcohol use represents. 

But having the technology is only half of the story. After all, it doesn’t matter how great a company’s product is if it’s not executing for its investors. 

That’s where SOBRsafe really shines. The company had several WOW moments in 2022 and is likely to have several more as 2023 progresses.  

Article Resources

Disclosure: CNA Finance is not an investment advisor or broker-dealer. This article was written by Joshua Rodriguez and expresses his personal opinion of SOBRsafe but should not be construed as a solicitation to buy, sell, or otherwise trade any specific security. This is a sponsored article and should not be considered investment advice. Investing comes with risk and CNA Finance strongly advises investors to seek advice from licensed professionals before making any investment decisions.