DRONE AVIATION HOLDI (OTCMKTS:DRNE) Wipes More Of Its Value
Out of the last twenty trading sessions the stock of Drone Aviation Holdi (OTCMKTS:DRNE) has been able to close in the green only 7 times and even then the gains have been minimal at best. After slashing another 9.5% during yesterday’s session the ticker now stands at $0.19 per share, 36.6% lower than its June 25 close of 30 cents per share. If you go further back the chart the losses grow even bigger – DRNE is down by over 62% from its highs of over 50 cents posted back in March.
The company has been issuing encouraging PRs but they have had almost no effect on the movement of the stock. At the end of June BAE Systems, a prime contractor for the US Government, placed an order for some parts and services which should enhance and support two WASP aerostat systems owned by the US Army. More recently DRNE entered into an agreement to acquire exclusive commercial software licenses for the “GUST” (Georgia Tech UAV Simulation Tool) autopilot system from Adaptive Flight, Inc.
This Wednesday Aviation Systems Engineering Company (ASEC), Inc. filed with the Federal Aviation Administration (FAA), an amendment to its previously granted 333 exemption for the commercial operation of Small Unmanned Aircraft Systems (sUAS) to include DRNE’s WATT-200 electric tethered drone. ASEC and DRNE have plans to partner on various commercial opportunities.
If these initiatives result in increased revenues for DRNE it would be a major step in the right direction because the results for the first quarter of 2015 were rather disappointing. The company generated just $15,206 in revenues which represents a decline of 93% compared to the $229 thousand for the same period last year. The net loss for the quarter was $934 thousand.
Another major negative influence on the movement of stock is undoubtedly the dilution that has been taking place for quite some time. As a result of the conversion of preferred shares DRNE’s outstanding shares count increased from around 12 million to 37 million at the end of 2015. During the first four and a half months of 2015 another 124,879 Series A Preferred shares were turned into 12,487,900 common shares. As of May 15 there were 271,871 Series A shares still outstanding.
As part of a $1 million private placement of 4 million Series G preferred shares DRNE also had to issue 2,700,000 shares of Series E Convertible Preferred Stock and 2,200,666 shares of Series F Preferred Stock. The Series G, E, and F shares can be turned into common shares at a 1:1 ratio.
Although DRNE lacks some of the more glaring problems associated with pennystocks, not to mention that they have the backing of none other than Dr. Phillip Frost, caution should still be used when approaching their stock. Be sure to do your own research before putting any money on the line.
