Inseego Corp (NASDAQ:INSG)

New CEO, CoB Appointments for Inseego Corp (NASDAQ:INSG) Lifts Shares

Inseego Corp (NASDAQ:INSG)

Inseego Corp (NASDAQ:INSG) gained over 15% in the market on Thursday to end the day at $1.13. The move upwards follows two days of the shares trading under $1 and establishing a new 52-week low. Trading was heavy. INSG shares have a 30-day, daily average volume of 207,800 but traded over 1.1 million shares in today’s trading.

The move was motivated by news out of Inseego Corp (NASDAQ:INSG) announcing that their CEO, Sue Swenson, was being replaced by Dan Mondor. Mr. Mondor is a veteran telecommunications executive with extensive knowledge of domestic and international markets and strong relationships in the global enterprise, telco, and mobility markets. After a 16+ year career at Nortel Networks, Mr. Mondor served as CEO of a number of public and private communications-related companies. Also announced was Phillip Falcone’s election to the Chairmanship of the Board of Directors. Mr. Falcone has a finance background with decades of experience in leveraged finance, distressed debt, and special situations investing.

Interestingly, the Board today decided to terminate the agreement to sell its MiFi business to TCL that was announced in September of 2016. Reports estimate that the move will save Inseego Corp (NASDAQ:INSG) $15 million annually. The same reports claim the move will move the company into profitability in 2018.

Inseego Corp (NASDAQ:INSG) develops software-as-a-service (SaaS) solutions and solutions for Internet of Things (IoT) for the telematics market. It serves wireless operators, distributors, original equipment manufacturers, and companies in vertical markets through direct sales force and distributors. The company was formerly known as Novatel Wireless Inc. and changed its name to Inseego Corp. in November 2016. Inseego Corp. was founded in 1996 and is based in San Diego, California.

Two investment firms follow Inseego Corp (NASDAQ:INSG). Both firms rate INSG shares as a “Strong Buy” with a consensus price target of $4.00.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. All information, or data, is provided with no guarantees of accuracy.

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About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.

XBiotech Inc (NASDAQ:XBIT)

Sentiments Turn Sour on Inseego Corp (NASDAQ:INSG) after Q1 Net Loss

Inseego Corp (NASDAQ:INSG)

Inseego Corp (NASDAQ:INSG) slump in the market shows no signs of slowing down especially on the company booking a first quarter net loss and sinking deeper into debt with financing. Net loss in the quarter rose to (-$16.1) million or (- $0.28) a share compared to (-$11.9) million posted a year ago.

Inseego Q1 Financial Results

Inseego Corp (NASDAQ:INSG)’s revenues also took a hit in the quarter declining by 17.2% to $55.4 million compared to $66.9 million as of Q1 2016. The leading provider of software-as-a-service and Internet of Things solution attributes the decrease to lower stand-alone hardware sales from the MiFi mobile broadband business.

Gross margin during the quarter dropped to 31.8% from 35.2% due to a decline in margins for the MiFi broadband products. The drop had a negative impact on Inseego Corp’s ongoing transition to an improved mix of higher-margin internet-of-things (IoT) solutions. The company exited the quarter with cash and cash equivalents amounting to $6.4 million – a decline from $9.9 million as of December 31, 2016.

Q2 Outlook

Given the pending divestiture of the MiFi broadband business, Inseego says it won’t issue overall guidance for the full year. However, the company expects revenues of between $14 – $15 million from its SAAS unit. Ctrack telematics unit, on the other hand, should generate revenues of between $15 – $16.5 million

“Our first quarter business performance was not what we had hoped as the pending MiFi divestiture transaction resulted in management and operational distraction throughout the quarter. We continue to see financial strength and market opportunity for our portfolio of SaaS, software and services solutions for the Internet of Things, and we need to drive excellence in execution throughout the organization, “said the chief executive officer, Sue Swenson.

MiFi Divestiture

During the quarter Inseego Corp (NASDAQ:INSG) announced it had reached an agreement with T.C.L Industries and Jade Ideal Global Limited for the divestiture of its MiFi Broadband business with its subsidiary Novatel Wireless. The company also closed a long-term loan with Lakestar Semi Inc. that provides it with access of up to $20 million. The company consequently terminated a revolving credit facility with Wells Fargo Bank

Inseego Corp (NASDAQ:INSG) stock was up by 10.68% in Friday’s trading session ending the week at highs of $1.14 a share.

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.

About the author: James Marion is a University of Houston student studying Business with a concentration in Finance.