Bravatek Revenues Should Excite Investors
- Company Releases 10-Q According to Plan
- Surprise Revenues
- Continues Reduction in Convertible Notes
- HelpComm Acquisition – Impressive Operational Facility
Bravatek Solutions, Inc. (BVTK) released it 10-Q today in line with expectations from the CEO on the last conference call and showed $75,498 in revenue which represents a milestone as the first revenues this year. This revenue was likely from the sale of Encrypt One software to Integro Health Systems, Inc and represents only the first treatment center. In the next year the Integro which is the parent company of Go ECO Group (LIBE) has plans to expand and purchase 5 more treatment centers which could represent $470,000 in additional orders. From the filing the gross margins are 97% on this product which means than any potential future order fall directly to the bottom line. Looking forward the company recently closed its acquisition with HelpComm which is supposed to add significant revenue in the Q3 for the company. The company has clearly turned the corner and is evolving into a revenue producing company.
Reduction in Convertible Notes
The convertible notes as of March 31, 2017 year end were $1.271 million and went down to $420,855 in the past 6 months. In the quarter ended June 30, 2017 they totaled $694,176 which reduced the convertible notes by $273,321 Quarter over quarter. No matter how you look at this the company made significant progress with the conversions. On the last conference call the CEO Tom Cellucci made references toward completely cleaning up the conversions with a new round of equity investors. It seems like this scenario is likely to play out short term.
No News is Good News
The company has been seeing a trend that when good news hits the stock goes down. When they announced they would be receiving a $21.4 million commission the stock went down. When they announced the HelpComm acquisition the stock went down. And now they have a good 10-Q that shows a significant reduction in convertible debt and the start of revenues the stock has dropped yet again. This could be the market forces at work or it could simply be poor communications by the company to tell their story. The company isn’t getting a pass from market participants but there might be a real wakeup call should the Company close the equity round of financings. It’s quite possible that this activity is related to the financiers trying to get themselves a better deal.
HelpComm has a very impressive facility with close to 10,000 SF of space and full of assets in which the company could be in a great position to leverage. The building itself could appraise for $1.7 million and there are about 20 vehicles onsite. The most important thing about HelpComm is that it is a true operating business generating real revenues.
The market reaction has been really confusing regarding the price of BVTK. It’s hard for market participants to know what to do when good news gets sold continually. They say a picture is a thousand words. For investors seeking clarity look at the pictures of HelpComm and ask is this a company that is going to make it. Then ask is the $21.4 million real? Finally does revenue make a difference? Long term investors will see that fundamental analysis is always right. Fundamentally this seem to be a very solid story and getting stronger by each and every press release.