DPW Holdings Inc (NYSEAMERICAN: DPW) is having a strong start to the trading session this morning, and for good reason. The company issued a corporate update, exciting investors and sending the stock on a run for the top. Today, we’ll talk about:
- The update;
- what we’re seeing from DPW stock as a result; and
- what we’ll be watching for ahead.
DPW Announces Corporate Update
As mentioned above, DPW Holdings is trading in the green this morning after issuing a corporate update. The update came by way of press release early this morning.
In the release, DPW pointed to an order backlog that has a value of approximately $70.8 million. Moreover the company also said that it anticipates resolving the remaining outstanding short-term debt of approximately $4 million before the close of Q3 2019.
The company said that it has reduced short-term debt by $10.5 million to date this year, pointing to its efforts to improve its capital structure and strengthen its balance sheet.
In order to pay off the remaining $4 million in debt, the company will raise funds by selling assets and posible spinoffs. These events are intended to take place over the next few months or fiscal quarters.
In a statement, Milton “Todd” Ault, III, Chairman and CEO at DPW, had the following to offer:
With approximately $50M in assets, we are moving forward to significantly reduce our debt as this will improve our balance sheet. We have a strong asset base to support our efforts and goals for the year, which include increasing the Company’s revenue growth and profitability, reducing our overhead and improving operational performance. We believe we will begin to report positive results starting in the second quarter of fiscal 2019.
With J.R. Read leading DPW Technology Group and the restructuring underway with DPW Financial Group led by Darren Magot, the Company has begun to set the spinoff of Digital Farms and a number of other initiatives to be completed this year dedicated to attaining our stated goals.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that the news leads to moves. When it comes to DPW, the news proved to be overwhelmingly positive.
With a strong order backlog, and short term debt that’s decreasing dramatically, the company is building itself into a stronger financial position. So, it’s not surprising to see that excited investors are pushing the stock for the top in the market this morning.
As is just about always the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (9:24), DPW is trading at $0.28 per share after a gain of $0.0039 per share or 1.44% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on DPW. In particular, we’re interested in following the story surrounding the company’s continued work to bring value to its shareholders by improving its balance sheet and capital structure. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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