The Week Ahead
On eastern Monday, WEE shareholder got a rebirth in SP as WEE sign on a new customer. A bull customer willing to take right away 16 powerwaves systems.
We also got an update for the current situation:
Wavefront has currently secured 166 Powerwave licenses. There are anadditional 93 licenses pending. Of the secured licenses, 56 Powerwavesystems are installed with the remaining backlog of tools slated forinstallation in the near term. The Company’s immediate action items aretoinstall the backlog of tools and to convert the 93 pending licenses toconfirmed licenses and revenue generating installations.
Note that the 56 Powerwave system excludes the 35-50 Cernovus which are now starting to be implemented (see Feb 25 press release)
In Q2, we move from 56+(35 to 50) = 91 to 106 (we are near breakeven est. between 115-125 installed units)
For those of you freaking out about cash flow positiveness the issue is moot moot and moot. the 10-15 short unites will be compensated by....
Remember Predator Pump, farm in agreements, stimulation market?
WEE also generates rev. from oil production which has gone up in price by 30% and pump installation is now brisk.
Also stimulation market was hot and WEE recorded sales there.
That implies the first ever profit in Q3 for sure.
Q2 being a buffer quarter where installation is being done.
Q2 could be profitable all depends on when those 35-50 Cernovus units will be installed.
Cash flow could be positive already.
Now that's for the financial analysis.
Technical analysis
As of Friday, All technical indicators are green. L-T, Medium term, Short term all green!
Fundamental Analysis
WEE suggested more new clients in latest press release:
Diverse opportunities for both Powerwave and Primawave continue to unfoldinEurope, including the North Sea region, South America, Australia, AsiaPacific and the Middle East. To prepare for the eventuality ofcontracts inthese locations, Wavefront is in the process of appointing localrepresentation and agents, as well as evaluating the
establishment of regional infrastructure
The last 4 press releases were surprises to the market. Each time, WEE added new clients or more implementation.
While waiting for 3 massive deals; Cernovus master agreement, Pemex and Alaska... we have all the little and mid-size existing clients expanding.
Also, we must content for new Tier 1 clients.
Also, we need to price in Halliburton takeover of WEE
Also, how oil is moving toward 100$ earlier than expected.
Financial analysis = low risk (we are at break even or weeks away from it)
Technical analysis = All green All bullish
Fundamental analysis = Very bullish
I think we have enough good momentum to stir the stock close to 3$ as we wait for the next big announcement.
Since Sept 09, there is on average news every 3 weeks.
So, in about 2 weeks we get another announcement if not earlier.
For long time holders of WEE, risk is behind now.
Rewards are ahead. You have been patient. Now is not the time to frustrate. The flowers are blossomming.