Digital Power Corporation (NYSEMKT:DPW)
Digital Power Corporation (NYSEMKT:DPW) was up by 49.81% in Friday’s trading session as investors reacted to news that the company had regained NYSE compliance. The rally also came after an announcement that the company’s customer order backlog had soared to over $65 million, an increase of $8 Million from a May 17, 2017, forecast.
Order Backlog Growth
Digital Power Corporation (NYSEMKT:DPW) bills itself as a designer, developer, and manufacturer of power system solutions. The company targets customers in the medical, military, telecom, and industrial markets with a wide range of power system solutions.
The growth of Digital Power’s customer order backlog supports the company’s growth strategy that focuses on both acquisitions and organic growth. The company attributes the robust growth to new and current customers as well as the consolidation of financial reporting to include Microphase Corporation.
“We continue to see strength in our custom power supply business as our order book grows. With the purchase of Microphase Corporation, we will also see strong cost savings which will increase our gross and net margins,” said CEO, Amos Kohn.
In the first quarter, Digital Power Corporation (NYSEMKT:DPW) received a 3-year $50 million purchase order from its customer MTIX Ltd headquartered in Huddersfield U.K. The order is for the manufacturing, installation, and servicing of a textile treatment system that utilizes MTIX’s proprietary system.
Shareholder Value on MTIX’s System
Digital Power Corporation (NYSEMKT:DPW) works on the restyle treatment system are set to begin and a $1.5 million deposit has been made. The company expects the remaining payments to be made in the coming weeks as production ramps up.
Digital Power Corporation (NYSEMKT:DPW) expects production of the MTIX’s systems to positively impact gross and net profitability heading into the year end.
“The added value to shareholders is yet to be understood. Over the coming years, this contract and relationship we believe will provide massive value to our shareholders,” said Mr. Kohn.
Separately, Digital Power Corporation (NYSEMKT:DPW) has regained compliance with the NYSE listing standards on filling of an 8-k report with the Securities and Exchange Commission. The report indicates that the company’s stockholder’s equity was about $6,409,000 on a pro forma basis as of June 19, 2017.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.