OTCPK:DRWIQ - Post by User
Comment by
JonathanJSmithon May 08, 2015 5:11pm
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Post# 23710196
RE:RE:Start accumulating now before Q4/Year End May 12
RE:RE:Start accumulating now before Q4/Year End May 12
As per Nasdaq letter:
"... The Company has 180 days, or until August 31, 2015, to achieve compliance with the minimum bid price requirement. To regain compliance, the minimum bid price of DragonWave's common shares must meet or exceed US$1.00 per share for a minimum of 10 consecutive business days during this 180-day grace period.
If the Company does not regain compliance with the Rule by August 31, 2015, the Company may be eligible for an additional 180 calendar day compliance period. To qualify, the Company would need to transfer the listing of its common shares to The NASDAQ Capital Market, provided that it meets the continued listing requirement for the market value of publicly held shares and all other initial listing standards, with the exception of the bid price requirement. The Company's failure to regain compliance could result in delisting of its common shares on NASDAQ.
Trading of DragonWave common shares on the Toronto Stock Exchange under the symbol "DWI" is not affected by the notice from NASDAQ."
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Effectively, they have until Feb 28th, 2016 to get their price over $1.00 for 10 consecutive days. I doubt they'll have any problem with meeting that requirement w/o a reverse split as they continue to expect sequential growth going into 2016. This Q, they're expecting over $50MM in revenues and a GM close to 20%; this puts them close to breakeven - perhaps (0.01)-(0.02)/sh pending the product mix (especially s/w support sales). Should Allen's expectations for growth come to fruition, we're looking at revs of ~$55MM for fiscal Q12016, which puts us around the August (calendar) time frame, and breakeven-positive net income (assuming a flat GM from the previous Q). Upon reaching this juncture, the stock should appreciate measurably in value.
That being said, one never knows what's going through management's head vis-a-vis a reverse split and the reasons thereof. Investors need to continue to exercise patience; but I suspect even patience has its limitations!
Cheers,
JJ