Digital Ally, Inc. (NASDAQ:DGLY)

Digital Ally, Inc. (NASDAQ:DGLY) Rallies

Digital Ally, Inc. (NASDAQ:DGLY)

Shares of Digital Ally, Inc. (NASDAQ:DGLY) rallied by 29.23% in Friday’s trading session after the company announced a significant victory in its legal battle against Axon Enterprise Inc. (NASDAQ:AAXN). On July 6, 2017, the U.S Patent Office denied Axon request for inter parties review of Digital Ally’s Patent No 9,253,452 in an ongoing litigation.

Patent Office Ruling

Digital Ally, Inc. (NASDAQ:DGLY) develops and sells digital video imaging and storage products commonly used by Law enforcement agencies. The company’s product are also used for commercial applications both in the U.S and abroad. Some of its products include in-car audio and video recording devices. The company also owns a system dubbed, VuLink that provides law enforcement with audio and video surveillance from various vantage points.

The Patent Office stated that Axon Petition does not in any way establish a reasonable likelihood of showing unpatentability of any of the challenged claims in the Petition. The Patent in question details the automatic activation and Coordination of multiple recording devices.

The invention eliminates the need of having to manually activate devices when law enforcement responds to an emergency. According to Digital Ally, Inc. (NASDAQ:DGLY), its technology will guarantee all evidence in a crime scene is visually captured even if officers forget to activate their cameras.

“It is unfortunate that Axon continues to raise these baseless validity arguments to avoid a clear case of willful infringement. We remain committed to defeating Axon’s arguments and ultimately winning this lawsuit. We look forward to restarting our patent infringement litigation in U.S. District Court against Axon, which had been stayed pending the Patent Office IPRs,” said Digital Ally CEO, Stanton E. Ross

Digital Ally, Inc. (NASDAQ:DGLY) is planning to move its petition against Axon to trial where it hopes a jury will put to an end to the patent infringement.

SightDeck Technology Acquisition

Separately, Digital Ally, Inc. (NASDAQ:DGLY) is in the process of purchasing a new special effects technology that it plans to use to expand its market. The company has signed a letter of intent to buy SightDeck technology from iMatte Inc. The technology in question is designed to produce theater quality special effects whenever real time integration of graphics is needed.

Under terms of the agreement, Digital Ally, Inc. (NASDAQ:DGLY) is proposing to pay iMatte 6% revenue from all the products sold using the SightDeck technology for three years.

Separately, Alliqua Biomedical is currently under investigation by law firm, Purcell Julie & Lefkowitz LLP over a potential breach of fiduciary duty involving the board of directors.

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.

Digital Ally, Inc. (NASDAQ:DGLY) Hit With Class Action Investigation

Digital Ally, Inc. (NASDAQ:DGLY)

Law firm, Purcell Julie & Lefkowitz LLP, has confirmed it is investigating Digital Ally, Inc. (NASDAQ:DGLY) over alleged violations of fiduciary duty by the board of directors. The law firm has yet to issue details on what the investigations pertain to, having stated that interested shareholders should contact it for additional information.

Digital Ally Earnings Call

News of the class action investigation comes on the developer of advanced digital technology products reporting that it will announce its Q1 2017 results on May 15, 2017. The company will also host an investor conference call to discuss its operating results as well as its long-term plans.

The last time Digital Ally, Inc. (NASDAQ:DGLY) posted financial results it said its revenue for the full year ending December 31, 2016, dropped by 17% to $16.6 million. Revenues in the fourth quarter were also down by 32% to $3.4 million compared to revenues of $5.1 million in Q4, 2015. Gross profit, on the other hand, came in at $148,807, down from $1.5 million the previous year same quarter.

Airport Upgrade Contract

Separately, Digital Ally, Inc. (NASDAQ:DGLY) says it has signed a three-year service contract to upgrade Airport shuttle bus fleet video systems for one of its customers. The customer in question is one of the largest near-airport parking companies with more than 30 locations in 20 airports. Under the terms of the agreement, the company is to upgrade the customer’s fleet of 388 DVM-250 in-bus event recorder systems.

Digital Ally, Inc. (NASDAQ:DGLY) will also install 78 new DVM-250 in-bus video systems fitted with Its FleetVU Manager. The contract should earn the company $400,000 including service revenues over the course of three years.

“We continue to be pleased by the success of our commercial division, specifically with our ability to retain and extend our current customer contracts. We pride ourselves on our ability to provide our customers with the most innovative and cost effective end-to-end total video solution available on the market, “said Chief executive officer Stan Ross.

The three-year contract pulls Digital Ally, Inc. (NASDAQ:DGLY) into a new market, the company having enjoyed success in the ambulance, taxi, Limousine market with the DVM-250 series. According to the CEO, they continue to gain significant market share in the airport ground transportation market. Focus going forward now shifts to widening the company’s sales channels as the race for new market opportunities heats up.

Digital Ally, Inc. (NASDAQ:DGLY)’s stock was up by 2.5% in Wednesday trading session consequently closing the day at $4.10 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: Monica Gray has an undergraduate degree in Accounting and an MBA – earned with Honors. She has six years of experience in the financial markets and has been a securities analyst for the past two years.

Digital Ally, Inc. (NASDAQ:DGLY) FY2016 Total Revenue Declined By 17%

Digital Ally, Inc. (NASDAQ:DGLY)

Digital Ally, Inc. (NASDAQ:DGLY) which develops, manufactures and commercializes advanced video surveillance offerings for law enforcement, commercial and homeland security applications, issued its operating report for the quarter and full year closed December 31, 2016.

For FY2016, the total revenue declined 17% to almost $16.6 million, against revenue of nearly $20 million in the year closed December 2015. This decline can be attributed to ongoing confusion led by Taser’s misleading PR pertaining to company’s patents, the reexamination of patent initiated by Taser, and product quality control concerns with FirstVU HD product.

In addition, the company speculates that Taser conspired to keep them out of the market by engaging in improper, unfair and unethical competition. They anticipate FirstVU HD sales to improve during 2017 as the company prosecutes the patent cases against WatchGuard, Taser and others, and resolves product quality concerns. They consider the VuLink product differentiates the Digital Ally product offerings from its customer’s.

The highlights

Stanton E. Ross, the CEO of Digital Ally, Inc. (NASDAQ:DGLY), reported that they were disappointed to post annual revenues for 2016 that dropped 17% from the preceding year, even though they witnessed a jump in service-based revenues. They are focusing on expanding their recurring service-based revenue to grow and stabilize revenues on a quarterly basis.

The company is pursuing numerous new market channels that don’t involve private security and traditional law enforcement clients. If successful, they consider that these latest market channels could result in increased recurring service revenues for in 2017 and beyond.

Digital Ally, Inc. (NASDAQ:DGLY) is assessing a new revenue model that brings together all product offerings, comprising the long-term lease of body-worn and/or in-car video/audio hardware, with a monthly subscription for company’s cloud storage, archiving and search services for the underlying video and audio material. They consider this revenue service model may entice clients, in specific non-law enforcement and commercial customers because it lowers the capital expenditure up front and removes repairs and maintenance in lieu for level monthly payments for the use of the data storage, equipment and management services.

The company recently announced the release of the ‘DVM-800’ HD in-car video setup, which they consider will be disruptive in the industry and will result in an expansion of overall market share in the law enforcement sector.

Ticker Symbol DGLY
Last Price a/o 3:21 PM EST $4.60
Average Volume 82.33K
Market Cap (mlns)  $24.84M
Shares Outstanding (mlns) 5.40M
Share Float (mlns) 4.47M
Inside Ownership 13.50%
Short Float 18.16%
Short Interest Ratio 9.86
Quarterly Return 10.84%
YTD Return 9.52%
Year Return -8.00%

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: Monica Gray has an undergraduate degree in Accounting and an MBA – earned with Honors. She has six years of experience in the financial markets and has been a securities analyst for the past two years.