News on DPW Holdings Inc (NYSEAMERICAN:DPW) authorization for pursuit of Initial Public Offering (IPO) for its subsidiary DPW Technology Group exited investors. On the day of the announcement the company’s stock gained 7.53% after having stagnated below a penny for some weeks. DPW Holdings announced that it had given the green light for the pursuit of a separate listing and IPO for its DPW Technology group in consistence with its November 2018 release on a scheduled simplification of its organizational structure.
DPW Financials
DPW Holdings posted relatively strong financials for its 2018 third quarter. The company reported total revenue of $8.34 million for the quarter implying a 0.61% gain from previous results. Sales for the third quarter gained 0.11%. During the fiscal quarter, the company spent about $6.32 million to boost sales of their products only getting a gross income of $2.03 million.
State of DPW Holdings’ stock
Trading at almost a penny, DPW Holdings’ stock is as risky as it gets. The stock closed at $0.094 in the just concluded trading period. This represents a saddening 12.48% nose-dive from its opening price. During the session, approximately 2 million shares changed hands against an average volume of about 1.45 million shares.
The stock has been trading between a 52-week low of $0.90 and high of $4.45. As of the previous trading session the shares had moved -98% its 52 week all time high and 7.63 percent its all time low. Analysts’ covering the stock have rated it at 2 with a consensus recommendation of a BUY.
Source: stockcharts.com
About the DPW Technology IPO
As aforementioned, DPW Holdings’ Board approved the pursuit of an IPO for DPW Technology on grounds of easing management pressure as well as providing a healthy investment option for its shareholders.
The new autonomous business will encompass DPW Holding’s entities of Coolisys Technologies, Inc., Microphase Corporation, Enertec Systems 2001 Ltd, Digital Power Limited, and Power-Plus Technical Distributors, LLC by and large – the company’s Defense and Aerospace businesses.
According to DPW Holdings’ CEO and chairman Milton “Todd” Ault, III, “our strategy is to create opportunities for investors to hold equity in more focused, streamlined entities. The technology and defense businesses have generated a significant backlog, and we believe the capital from an ipo will accelerate revenue growth and, ultimately, add value to our stockholders.” He further state that , “this announcement follows recent news regarding our pursuit of a spin-off of, or other transaction involving, super crypto mining, inc. and we look forward to enhancing value for both companies as they enter their next phase of growth.”
DPW Holdings will hire a new CEO to spearhead operations during the IPO and plot future growth strategies. According to the press release, DPW Holdings will retain an ownership stake of the newly publicly traded company to be. The IPO is expected to end in the first half of 2019. It is a little bit too early to speculate whether DPW Technology will hold significant value compared to its parent company- although based on the activities around the stock after the release, the future looks bright for the new entity.