EDNT has Up To +44pct in UPSIDE POTENTIAL in the Near-Term!=====================
Our New Pick is: EDNT
Current Price: $6.25
Float: 825.59K
Corporate Update/Investor Presentation
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Members,
One of our favorite low-float, Nasdaq listed alerts appears to be primed and ready for another round of +20% single-day gains.
Please turn your immediate attention EDNT (Edison Nation Inc.).
We first brought EDNT to your attention back on October 30th.
Members who acted on our buy call were able to secure up to +23.95% in realistic gains.
We are now anticipating another big move from EDNT.
Here's why...
EDNT is coming off one of their most impressive quarters history.
The Company witnessed a huge increase in both their top and bottom line.
Revenue in the third quarter of 2018 increased 56% to $4.9 million, compared to $3.2 million in the third quarter of 2017.
Gross profit increased 26% to $1.3 million in the third quarter of 2018, compared to $1.0 million in the third quarter of 2017.
Despite these blockbuster numbers, EDNT has managed to fly under the radar.
But we have a strong feeling that this will all change tomorrow.
Once the Street takes notice of EDNT's dynamite Q3, this low-float ticker could blow past $7.00 and possibly hit a new 52-week high.
That's right, the float on EDNT is just 825.59k.
A float that low is almost unheard of for a Nasdaq listed company.
As you all know, we love these low-float picks.
The slightest burst in volume can shares soaring.
And if they go viral, traders could see single-day gains of over +100%!
Immediate Bullish Catalysts for EDNT:
Low-float of just 825.59k
Acquired Cloud b, Inc., the world’s leading manufacturer of products and accessories that help parents and children sleep better.
Launched its first micro-brand crowdfunding campaign on Kickstarter, the MasterSous: The 8-in-1 Smart Cooker.
Growing revenue (Q/Q)
Q3 2018 Revenues Increase 56% to $4.9 Million; Gross Profit Increases 26% to $1.3 Million
$6.5M in gross proceeds from April 2018 IPO
Partners with several Fortune 500 companies such as, Walmart, Target, Rite-Aid, Disney, Home Depot, and Amazon
High insider ownership (47%)
About Edison Nation
Edison Nation, Inc. is a vertically integrated innovation aggregation and full-service product development and manufacturing company, offering innovation sourcing, design, sales, fulfillment and shipping services. Edison Nation's model is to provide a risk mitigated platform that connects innovators with companies to bring new products to market.
Company Highlights
Edison Nation, Inc. (Edison Nation) is a vertically integrated, full-service, product development and manufacturing company (design, manufacture, sales & fulfillment)
Edison Nation’s business provides a low-cost R&D platform to test consumer interest in new products via innovation searches, disintermediating the traditional high fixed-cost R&D model (average cost to develop and test a product is $25,000)
Their successfully licensed products on behalf of their inventors have generated +$250M in sales
Completed Reg A+ IPO of common stock and listed on NASDAQ in May 2018, raising $6.5M in gross proceeds at $5.00/share.
Experienced leadership team with high insider ownership (~47%)
What does Edison Nation Do?
Since inception, Edison Nation has invested ~$11M to create a propriety open innovation platform, allowing inventors to safely and securely submit their ideas to be evaluated for various commercialization paths from licensing to, most recently, crowd funding.
Typical crowd funding product development cycle:
Edison Nation’s team of product designers and engineers then produce a ready for production prototype, and produce media in-house to launch a crowd funding campaign.
If a campaign is successful they will market the product in the “aftermarket” on sites such as Amazon & Jet
Products are generally manufactured in China with factories (we have 10+ year relationships, generally shipping within 4-6 weeks from order)
Growth Opportunities:
Utilizing the Edison Nation platform to organically source innovative ideas, bringing them to market through their low-risk crowd funding strategy (strong engine for future ideas to bring to market)
Continued growth of licensed product manufacturing through Fortune 500 partners such as Disney, Marvel, and Universal Studios
Acquisition of promising products/micro-brands using a combination of cash and stock
Recent Developments
Edison Nation, Inc. Provides Third Quarter 2018 Corporate Update and Financial Results
Q3 2018 Revenues Increase 56% to $4.9 Million; Gross Profit Increases 26% to $1.3 Million
Recent Operational Highlights:
Acquired the Company’s strategic partner, Edison Nation LLC, the leader in crowdsourced innovation, which enables the Company to fully leverage its established operating infrastructure to form a true full-service product development platform.
Changed the Company’s corporate name to Edison Nation, Inc. In conjunction with the name change, the Company’s ticker symbol changed from “XSPL” to “EDNT” on the Nasdaq.
Acquired Cloud b, Inc., the world’s leading manufacturer of products and accessories that help parents and children sleep better, whose products are distributed in over 100 countries worldwide. As a private company, the unaudited estimate for revenue from Cloud b in 2017 was approximately $8.0 million for 2017 with a gross margin of 45%. The acquisition is expected to be immediately accretive to Edison Nation.
Launched the Company’s first micro-brand crowdfunding campaign on Kickstarter, the MasterSous: The 8-in-1 Smart Cooker. To-date, the Kickstarter campaign has exceeded the initial pledged goal by more than 300%.
Engaged with Church and Dwight, BLACK + DECKER and Worthington Industries to launch innovative searches in product categories of each company’s respective area of interest, aggregating relevant submissions through the Company’s Edison Nation platform.
Launched a new Crowdfunding tool by which the Company will cover development and crowdfunding campaign-related costs for select, high-potential ideas, allowing products to reach the market at lightening-speed to maximize sales and reduce total R&D costs.
Management Commentary
“The momentum we established in the first half of the year has continued, highlighted by our revenue growth of 56% to a record $4.9 million in the third quarter of 2018,” said Chris Ferguson, Chief Executive Officer of Edison Nation. “In addition to this growth, we’ve made significant strides to accelerate growth moving forward, most notably with our successful acquisition of our strategic partner, Edison Nation, LLC, the leader in crowdsourced innovation, which will enable us to fully leverage our established operating infrastructure to form a true full-service product development platform. This acquisition will serve as our engine for product innovation and provide a strong pipeline of micro-brand opportunities for us to leverage, as we are able identify proprietary products through idea submission, find the ‘best of the best’, and launch them into the market quickly. We will do this either through licensing agreements with our established base of relationships, or via our newly announced crowdfunding strategy–a de-risked business model that allows us to generate initial sales on platforms such as Kickstarter and Indiegogo before expanding to online retailers such as Amazon, among others.
“Supporting this vision is our first crowdfunding campaign launched as a combined entity on Kickstarter, the MasterSous, an 8-in-1 Smart Cooker. We are already extremely pleased with the robust interest in this product, which has already exceeded our pledged goal by more than 300%. During the quarter, we also announced our accretive acquisition of Cloud b, Inc., the world’s leading manufacturer of products and accessories that help parents and children sleep better. With products distributed in over 100 countries worldwide, we have the unique ability to integrate our proprietary product development expertise to manufacture and market Cloud b’s existing products, while also helping to develop exciting new product lines. Their team of professionals and superior products will add a key element to our growth strategy, while expanding our footprint on the West coast by leveraging Cloud b’s significant distribution, sales and fulfillment operations.”
Ferguson, concluded: “Our efforts to become a leading vertically integrated innovation aggregation and full-service product development and manufacturing company is unfolding quickly. As we move through the remainder of 2018 and into the new year, we look forward to continuing our operational and financial execution, which we are confident will drive shareholder value over the long-term.”
Third Quarter 2018 Financial Results
Revenue in the third quarter of 2018 increased 56% to $4.9 million, compared to $3.2 million in the third quarter of 2017. The increase in revenues was primarily due to the addition of new products and customers in the consumer products segment, as well as increased demand from customers in the packaging materials business.
Gross profit increased 26% to $1.3 million in the third quarter of 2018, compared to $1.0 million in the third quarter of 2017. Gross profit margin as a percentage of revenue was 26.4% in the third quarter of 2018, compared to 32.5% in the third quarter of 2017. The decrease in gross profit margin as a percentage of revenues was primarily due to unfavorable product mix in the packaging materials business, as well as increased tariffs and lower margin product sales.
Operating expenses were $2.1 million in the third quarter of 2018, compared to $0.8 million in the third quarter of 2017. The increase was primarily attributable to the increase in total segment and consolidated revenues.
Net loss totaled $1.7 million, or ($0.37) per basic and diluted share in the third quarter of 2018, compared to net income of $0.3 million, or $0.11 per basic and diluted share in the third quarter of 2017.
Adjusted EBITDA, a non-GAAP measure, totaled $37,000 in the third quarter of 2018, compared to $0.3 million in the third quarter of 2017. See below under the heading, “Use of Non-GAAP Financial Information” for a discussion of Adjusted EBITDA and a reconciliation of such measure to the most comparable measure calculated under U.S. generally accepted accounting principles ("GAAP").
Cash and cash equivalents at September 30, 2018 totaled $2.1 million, as compared to $3.9 million at June 30, 2018. The Company believes it currently has sufficient funds to meet its working capital, debt service and capital expenditure requirements for at least the next 12 months.
Further details about Edison Nation’s results in the third quarter of 2018 are available in its Quarterly Report on Form 10-Q, accessible in the investor relations section of the Company’s website at www.edisonnation.com and through the U.S. Securities and Exchange Commission’s website.
Edison Nation’s Crowdfunding Approach
Edison Nation’s Crowdfunding tool was introduced to drive higher success potential for ideas to be commercialized. Investors submit their ideas through the Edison Nation platform (located on its website www.edisonnation.com), and for all ideas chosen from the Crowdfunding search, Edison Nation will handle the costs to develop the products and run their respective crowdfunding campaigns. Successful campaigns will provide a stronger position for products to be commercialized, either directly by Edison Nation, or through traditional licensing agreements.
Edison Nation’s proprietary platform ensures privacy of intellectual property and streamlines communication and negotiations with innovators. For over 10 years, Edison Nation has been and continues to be the trusted destination for innovators, partners and consumers alike and the trusted leader for quality innovation.
Market Outlook
Consumer Buying Habits are Shifting
The “retail apocalypse” is continuing as consumer purchasing habits trend towards online purchases.
The e-commerce market is expected to grow at a 13% CAGR to $682B by 2020.
Consumers are increasingly innovation driven with a need for instant gratification, as consumer desire for next-generation products surpasses the need for brand recognition.
The trend towards crowd funding (i.e. Kickstarter)is disrupting the legacy product development cycle through pre-ordering of products – financing product development while reducing sales risk.
Shifting consumer trends driving the growth of market places (i.e. Amazon) and crowd funding sites provide unique tailwinds for EDNT's growth.
Technical Analysis
Based on our most recent charting analysis of EDNT we see the potential for a run up to $9.00.
This equates to a gain of up to +44% from today's alert price.
As most of you know, we love low-float picks like EDNT because of their potential for huge single-session gains.
EDNT is looking extremely attractive at our alert price of $6.25.
We've watched EDNT swing between $5 and $7 several times over the past few weeks, which is why we believe a single-day move of over +20% is very possible.
In fact, the last time we brought it to your attention shares ran-up over +20%!
Traders who start their positions at our alert price could see themselves in the perfect low-risk/high-reward scenario.
EDNT hasn't closed under $5.74 this entire month.
EDNT has traded as high as $7.83, but we believe we could see an all new 52-week high in the immediate future!
EDNT has the potential to be one of the biggest gainers on the Nasdaq.
As such, we are urging all members to act fast, start their research, and make sure to add EDNT to the top of their watchlist
(*Remember to use a Stop-Loss Order or basic Limit Order to protect your gains, as well as limit possible losses.)
Best Regards,
The TopMarketGainers Team
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