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Technology Firm Receives Purchase Order for $4.5M, Stock Rallies On News
By: AllPennyStocks.com News
November 30, 2011
It’s a tough world out there and a real struggle for companies of all sizes to keep finances in order and operations generating revenue that outweigh costs. Sure there’s the Exxon Mobil-type firms that record monumental amounts of cash flow and profits, but for the majority of firms, these last few years have been especially tough. Developmental companies have seen venture capital dry-up, further adding to difficulties in growth. Sometimes, though, with developmental companies investors can just see the pieces of the puzzle starting to come together slowly, but surely.
NavStar Technologies, Inc. (Pink Sheets:NVSR), an Anaheim, California-based company focused on producing and commercializing products and services for tracking/monitoring and reporting on the location and condition of high value cargo and other assets, is a firm that seems to be pulling it together in the second half of 2011.
In June, NavStar upgraded its tier status on OTC Markets from Limited Information to Current Information in an effort to provide investors with more information regarding the company. This was followed in August by a shareholder-approved reverse split to reduce the number of shares of outstanding common stock from 65,000,000 to 650,000. As often follows a split, funding was secured to shore up developments. In the case of NavStar, $2.4 million in funding came from an investment group in Southern California to be invested in the final development and manufacturing of its NavStar’s GPS tracking and monitoring products and services and add sales and marketing personnel. NavStar had expected to be selling its products and services by March 2012.
Recently, deals have started streaming in even before the company’s targeted date. Last week, it was reported that an agreement had been reached with Trinity Noble to add cell phone usage detection while driving to its portfolio of Electronic On Board Recorder (EOBR) hardware and services.
Today, more significant news hit the wire as NavStar disclosed a purchase order for $4.5 million to provide monitoring and tracking hardware and services for the U.S. PowerSports market segment in 2012. NavStar is looking to capitalize on the industry which has seen the sale of more than six million PowerSports vehicles (motorcycles, scooters, All-Terrain Vehicles) in the last five years alone.
With the U.S. Department of Transportation (DOT) proposing new regulations that would completely ban all hand-held cell phone use by truck and bus drivers while operating commercial vehicles, the EOBR industry presents a significant opportunity for NavStar. In the PowerSports arena, the majority of insurance companies offer discounts of up to 30 percent when owners have tracking devices on their PowerSports vehicles. This too bodes well for NavStar’s potential. Amongst its many features, the NavStar PowerSports device is small, environmentally protected, easily hidden, provides motion, theft and speeding alerts via cell phone or email. The revenue opportunity in 2012 for NavStar in this market segment is between $6 and $8 million. Initially, NavStar is hoping to snag 3 to 4 percent of this market segment. This latest purchase order reported today for 23,000 units puts NavStar on a solid path towards the 3 percent market penetration.
Over the last year, shares of NVSR have been on a significant slide, but with very little volume. The recent news has been supporting higher volume days in the month of November. With deal flow starting to arrive, if the company can maintain the tight share structure as a result of the split while it continues to fund expansion, NavStar Technologies may be a firm to keep a close eye on in 2012. Proper due diligence is, as always, encouraged.
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