Now locked and loaded, Amplitech (AMPG) has raised more than $30 Million since an uplist to Nasdaq on February 17 th , 2021- including an institutional secondary at $8.48 via Maxim Group Securities – one of the best mid-level ($25-$100 million) investment bankers out there.
Maxim was engaged on October 15, 2019, as its financial advisor to assist the Company in growth strategy to the investment community with the ultimate goal of an up-list and capital raise on NASDAQ. So good work guys and Soroya!
The 20:1 reverse on the day of the uplist means this was previously a $0.25 stock (at current equivalent prices) so in essence, nobody has heard of this company. Certainly no institutions we know of. Hmm.
LETS TAKE A PEEK AT WHAT WE HAVE HERE
First, while Amplitech is tiny with just $3 million in revenues, is not a chalkboard technology experiment type company – as evidenced by a recent $120,000 trial order for its ultra-low noise amplifiers.
The order for use in Space-borne satellites and probes that orbit around the earth came from a major Fortune 200 Defense Contractor. More important than its size, it is an opportunity for Amplitech to show off its capabilities. They also have a $2.4 million backlog. Again not large, but the products are at least ‘for real.’
In addition, while it is a trial order – there is typically a tremendous amount of due diligence conducted by the contractor, to get this far in the door with contractor. So if you’re like us and you’re an investor, but not a ultra-low noise amplifier expert – you don’t need to fully understand the technology. We call this the quality of technology assessment technique QOTAT (omg lol) and “let the customer determine if it really works.”
And while it is a trial, and while $120,000 isn’t a lot of money – what is of issue is the time and effort the defense contractor spent to assess the technology before getting to the point of placing a trial order. We think you’ll agree defense contractors have to feel fairly confident the technology works, before sending it into orbit 600 miles away.
Yes, the trail could fall short – but with the valuation of the stock, we don’t think any premium is baked into the share price, so minimal downside related to that.
On the flipside or the upside – if it works, this could lead to a domino effect of other Fortune 500 companies ordering the amplifiers – and we’re off to the races.
So fingers crossed.
Which brings us to what attracted us to Amplitech in the first place – valuation! With roughly 9.3 million shares outstanding (not super sure on that share count with recent raises) we have a market valuation of just $46 million. Versus cash and cash equivalents of approximately $30M as of May 17, 2021.
Hello – double hmm. If you’re from the camp of looking down before looking up – when combined with the upside potential – this is a darling of an idea.
“It is our belief that AmpliTech is solidly positioned in markets that could generate annual revenues in excess of $100 Million within the next several years, if we execute our business plan as anticipated.” Fawad Maqbool, President, CTO, and CEO*
So what does Amplitech do?
AmpliTech Group, Inc. designs, develops, and manufactures custom and standard state-of-the-art RF components for the Domestic and International, SATCOM, Space, Defense and Military markets. These designs cover the frequency range from 50 kHz to 40 GHz – eventually, offering designs up to 100 GHz. Okay, boring.
But wait, there’s more!
Here are some sound bites from a recent press release. Which are a tad more exciting and potentially appealing to the MEME crowd that everyone is so desperate in trying to get their attention – to send their own shares into orbit along with their amplifiers:
- As the race to launch Low Earth Orbit (LEO) and Medium Earth Orbit (MEO) accelerates, the need for low noise, low power dissipating, and highly reliable amplifiers grows to be absolutely essential.
- This week Bloomberg reported that SpaceX moved closer to obtaining FCC approval to launch Starlink satellites at a lower orbit to achieve higher service performance. Starlink alone plans to launch up to 42,000 satellites by mid-2027.
- CNBC reported last week that Amazon will also be looking to commence 9 missions to launch 3,236 satellites in LEO in the near future.
- LEO and MEO satellite launches aim to increase global connectivity among billions of IoT devices, improve network speed constraints, democratize internet access, and connect people as well as devices in a way never before attainable.
That’s more sexy sound bites than an adult entertainment convention in Las Vegas. So looking from 600 miles up – we have satellites, 5G wireless communications networks, the Internet of Things and a recently announced effort to create an unhackable communications channel that creates a new security paradigm: state-of-the art signal amplification secured by intelligence-community-caliber hardware encryption. What the? And it’s trading near cash?
What’s not to like?
That’s all for now. Like we said – locked and loaded.
For the more venturesome (aka greedy) there are $7.00 warrants good for five years. They were recently trading near $2.00. If Amplitech goes to $20, that would mean a gain of 300%. At that price, the warrants without any premium should be worth $13 or a gain 550%.
We have been told by a savvy investment banker that some secondary’s trade weak after the fund raise because some institutional investors sell some of their stock to deploy into some other idea and keep the warrants. Which could account for the post-offering weakness. Just saying!
If you’re mathematically challenged as we are, here is a simple percentage calculator we use daily.
*His words, not ours. We never make revenue projections and don’t issue price targets. Price potential sometimes, but never targets.
This release contains statements that constitute forward-looking statements. These statements appear in several places in this release and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company’s ability to execute its business plan as anticipated; (ii) trends affecting the Company’s financial condition or results of operations; (iii) the Company’s growth strategy and operating strategy. The words “may,” “would,” “will,” “expect,” “estimate,” “anticipate,” “believe,” “intend,” and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company’s ability to control, and that actual results may differ materially from those projected in the forward-looking statements because of various factors. Other risks are identified and described in more detail in the “Risk Factors” section of the Company’s filings with the SEC, all of which are available on our website. We undertake no obligation to update, and we do not have a policy of updating or revising these forward-looking statements, except as required by applicable law.
