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Why Virtra Systems, Inc. Could Be Similar To Force Protection, Inc.

|Includes: VirTra, Inc. (VTSI)


  • Do you remember Force Protection, Inc. back in the mid-2000's?
  • Why I think VTSI could be similar to FRPT.
  • What could the future bring to VTSI.
  • Risks and rewards involved in Pink Sheet stocks.
  • Modern Round in Phoenix

An analyst report in 2006 described Force Protection, Ins. as follows:

"Force Protection, Inc. supplies the US Military with specially armored personnel carriers that are nearly impervious to civilian/terrorist and remote attacks. During the last several years in Iraq and Afghanistan, one of the greatest costs to soldier's lives and welfare has been mines and IEDs. The Company's vehicles protect the occupants from these attacks. We are witnessing a chase by the Government to employ these distinctive and safe vehicles as rapidly as possible thereby making FRPT an interesting idea and attractive investment at these price levels."

You may remember that during the Iraq war there was a public outcry concerning the deaths and injuries of our soldiers from IEDs (improvised explosive devices). The HumVee's were not safe enough to protect our soldiers from IEDs buried in the roads over there. Force Protection designed and manufactured the MRAP (Mine-Resistant Ambush Protected) vehicle to counteract the IED threat…and they did an excellent job! FRPT went from under $1 to over $30 in a couple of years. There were SA articles written about FRPT at the time. FRPT was eventually purchased by General Dynamics.

FRPT was in the right place at the right time back in 2005-2007. Our soldiers needed protection and FRPT had the solution. The public demanded the MRAPs to save lives and as a result Force protection's stock price soared.

Virtra Systems, Inc. is in a somewhat similar situation now because of the highly publicized, deadly encounters between law enforcement and the public. The public is demanding a solution to these horrible confrontations. Civilians and police are dying and protests have sprung up in most every major city to stop the carnage. Social media has shined an ever present light on anything negative in the world and this will only accelerate into the future. Our police need to be better trained to recognize the difference between friend or foe. VTSI has the technology to help train our law enforcement officers to use better judgment in their respond to dangerous situations involving use of force.

The Virtra Systems, Inc. (OTC:VTSI) website describes their business:

"VirTra offers a full line of the very best judgmental use of force training simulators along with full weapons simulator training capability. VirTra offers portable single-screen simulators all the way up to the most challenging and advanced use-of-force simulator in the world - the V-300™ LE.

Our customers enjoy the only upgrade path in the market, they can upgrade from 1 screen to 3 screens or even upgrade to 5 screens (300 degrees) as their future budgets permit. In the top-of-the-line 300-degree wrap-around simulator, police can train for the most difficult real-world situations, such as ambushes, active shooters, and maintaining situational awareness during extreme stress. Officer presence, verbal skills, less lethal force options, and deadly force, are all available for simulation use."

Future: It seems that the government is already starting to take notice of VTSI. In April the US Department of State selected Virtra as one of two companies to participate in a $40 million indefinite delivery/indefinite quantity (IDIQ) contract for law enforcement training simulators. Two orders have been received by VTSI since then for approximately $1 million each; one in June and July. The majority of the simulators are expected to go to foreign partners in support of the US Foreign Assistance programs. We need these training simulators for our police here in our country and for our military around the world. In many foreign countries our military acts as local law enforcement. They could also greatly benefit from this training. Hopefully more contracts will be coming soon to assist our law enforcement officers and our military.

Risks: As with all pink sheet stocks there are a myriad of pitfalls involved so make sure that if you decide to invest do it with the knowledge that you could lose all of your investment. No audited financials have been issued by management in many years so we have no idea about the asset, debt or equity structure of the company. Hopefully that will be remedied soon. Plus my experience with these types of stock has taught me that we may see more negative surprises in the near term than positive ones. Reverse splits and unfavorable financing deals come to mind. In short…Beware!!

Rewards: I owned Force Protection during its meteoric rise to the $30s. It was a life-changing trade for me. I don't think that VTSI will experience a "30 bagger" but I can see a substantial rise in the price of VTSI stock. There has already been stealthy accumulation going on. This story could be very interesting.

From the New York Times this morning: "Charles Kinsey, a behavior therapist, was shot by the police in North Miami, Fla., on Monday while trying to help a patient with autism. Mr. Kinsey was lying on the ground with his arms up when the police opened fire." It is events like this that leads me to believe Virtra's product is needed.

Modern Round: If you are interested in seeing the one-screen version of Virtra's software at work then a visit to Modern Round in Phoenix will be eye opening. I was there this week and came away with a much healthier respect for what our police go through every day. Not only was I bad in determining friend from foe, I failed in my marksmanship skills also. As I progressed through the scenarios my decision making dramatically improved if not my aim. I'm a believer in this technology.

Disclosure: I am/we are long VTSI.