Active Wall St. announces its post-earnings coverage on DragonWave Inc. (NASDAQ: DRWI). The company posted its financial results for the second quarter fiscal 2017 (Q2 FY17) on October 12, 2016. The Ottawa, Canada-based company reported a year-over-year decline in its quarterly revenues while its net loss narrowed during the reported quarter. Register with us now for your free membership at: http://www.activewallst.com/register/.
Today, AWS is promoting its earnings coverage on DRWI. Get our free coverage by signing up to http://www.activewallst.com/registration-3/?symbol=DRWI.
In Q2 FY17, DragonWave’s total revenue declined to $13.23 million from $26.92 million recorded at the end of Q2 FY16. Total revenue numbers for Q2 FY17 fell short of market consensus estimates of $14.25 million. The company’s Hardware and other revenues for Q2 FY17 was $9.53 million compared to $22.61 million reported in Q2 FY16. The company’s Services’ revenues came in at $3.70 million in Q2 FY17 versus $4.30 million in Q2 FY16.
Meanwhile, total revenue registered a sequentially growth during the reported quarter. The company’s total revenue surged 30% on sequential basis excluding the Nokia channel during the reported quarter. The revenues from Nokia channel contributed 24% to total revenue in Q2 FY17, versus 38% to total revenue in Q1 FY17.
The global supplier of packet microwave radio systems’ net loss came narrowed down to $3.94 million, or $0.96 per diluted share, in Q2 FY17, from net loss of $20.97 million, or $6.96 loss per diluted share, in the prior year’s comparable quarter. However, net loss for the reported period missed market consensus net loss estimate of $0.95 per diluted share.
Peter Allen, President and CEO of DragonWave said in the earnings release:
“We are pleased with the growth in our direct revenue in the quarter and the progress that we have seen on our renewal and restructuring approach. We expect to continue this progress in coming quarters. We remain focused on revenue and margin growth opportunities presented by our new feature rich products while maintaining strong cost control.”
In the quarter ended on August 31, 2016, DragonWave’s gross profit was $3.86 million compared to $3.99 million in the year ago quarter. Furthermore, gross profit before inventory provisions came in at 31.9% of total revenue in Q2 FY17 versus 31.0% of total revenues in Q1 FY17. Operating expenses for Q2 FY17 was down by $0.4 million from $7.3 million in Q1 FY17 to $6.9 million Q2 FY17.
Cash Matters and Balance Sheet
At the end of quarter on August 31, 2016, the company reported inventories of $22.70 million, which stood at the same level as on February 29, 2016. The company reported cash and cash equivalents balance of $7.47 million on August 31, 2016, which was above $4.28 million as on close of books on February 29, 2016. Additionally, the company reported total long-term liabilities of $3.88 million as on August 31, 2016, compared to $0.50 million as on February 29, 2016.
On August 08, 2016, DragonWave closed its public offering amounting to $6.0 million. The company sold 1,760,880 of its Class A Units and 30,164 of Class B Units. The Class A and Class B Units were priced at $3.35 per Unit and $3.34 per Unit, respectively. The company stated that the money raised from the public offering would be utilized for general corporate purposes, including working capital, general and administrative expenses, capital expenditures, and implementation of strategic priorities. After the public issue the number of outstanding shares increased to approximately 5.49 million from 3.02 million approximately.
At the close of trading session on October 12, 2016, DragonWave’s stock price rose 2.26% to end the day at $2.72. A total volume of 87,133 thousand shares were exchanged during the session, which was above the 3-month average volume of 76.78 thousand shares. The stock currently has a market cap of $9.90 million.
Active Wall Street:
Active Wall Street (AWS) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and micro-cap stocks. AWS has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.
AWS has not been compensated; directly or indirectly; for producing or publishing this document.
PRESS RELEASE PROCEDURES:
The non-sponsored content contained herein has been prepared by a writer (the “Author”) and is fact checked and reviewed by a third party research service company (the “Reviewer”) represented by a credentialed financial analyst, for further information on analyst credentials, please email firstname.lastname@example.org. Rohit Tuli, a CFA® charterholder (the “Sponsor”), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by AWS. AWS is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.
AWS, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. AWS, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, AWS, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.
NOT AN OFFERING
This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither AWS nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://www.activewallst.com/disclaimer/.
For any questions, inquiries, or comments reach out to us directly. If you’re a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:
Phone number: 1-858-257-3144
Office Address: 3rd floor, 207 Regent Street, London, W1B 3HH, United Kingdom
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.