Seeking Alpha

WPCS +13.6% AH after announcing operational updates, disclosing conversions

  • WPCS International (WPCS) shares add another 13.6% AH to the regular trading day's 15.7% gain after the company announces several operational updates.
  • In the last four months, WPCS's 2 profitable domestic subsidiaries have executed new contract awards of $6.8M (+27% Y/Y). Notable customers include Johnson Controls, Siemens, Honeywell, SimplexGrinell, S.F. Airport, Sutter General Hospital, and California Pacific Medical Center.
  • WPCS has initiated a search for a President of recently-acquired BTX Trader, secured office space in NYC, and is "pursuing several key BTX-related strategic initiatives that it hopes to be able to report upon early in 2014." Since announcing a public beta, the platform has seen a 600% increase in beta enrollments.
  • The company will relocate its corporate office to a smaller, lower cost space after its lease expires at the end of Jan. WPCS also expects to save ~$200K in future compensation expense to to a separation agreement with a former exec.
  • Finally, WPCS has entered a non-binding agreement with a broker to find a buyer for the 60% interest in its China JV.
  • UPDATE: The company files a disclosure with the SEC that between Dec. 19 and Dec. 30 it received conversion notices to issue 6.4M shares in exchange for $1.27M (representing a conversion price of ~$0.20/share). Shares outstanding as of Dec. 30 totaled 12.1M, with $1.3M in principal of convertibles remaining. In aggregate the conversions represent an 89.1% increase in shares outstanding. (8-K) The conversions have been a sore spot for investors since WPCS's CEO did not disclose the total sum on a conference call earlier this month.
Comments (3)
  • Bleecker Street Research
    , contributor
    Comments (471) | Send Message
     
    This company sure is getting a lot of press for something with a $3 mm market cap.
    31 Dec 2013, 05:46 PM Reply Like
  • EricFinance
    , contributor
    Comments (18) | Send Message
     
    Correction on mkt cap - shares outstanding of 12.1 million shares times closing price of $2.28 is 27.6 million market capital
    1 Jan, 05:54 AM Reply Like
  • ARNA Investor
    , contributor
    Comments (104) | Send Message
     
    That 27.6 M market cap should fall dramatically today assuming that investors are getting sick of the conversion crap.

     

    Waiting patiently on the sidelines.
    2 Jan, 04:55 AM Reply Like
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