Digital Power Corporation (NASDAQ:DPW) shares plummeted significantly from $5.64 at the end of the last year to $1.48 at the beginning of 2018; the plunge was blamed on the common stock offering of 1.2 million shares. The company was looking to raise cash to support its investments in growth opportunities.
It stock started rebounding after DPW announced higher than expected growth in revenue for 2018. DPW stock currently trades above $2 – with the market capitalization of $53 million. Digital Power stock has the 52-week trading range of $0.40 – $5.95.
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The company increased its revenue guidance for 2018 to $44-$48M, sharply higher compared to the earlier outlook of $36-$38M.
The expected growth in revenues was the outcome of its investments in growth opportunities, including the recent acquisitions and stronger than anticipated growth in the crypto-mining division.
“We are happy with our acquisitions and with the success, we have experienced with crypto-mining. We are excited about our prospects for 2018 and our ability to deliver added value to our stockholders as we continue to execute our strategies,” said Milton “Todd” Ault, III, the Company’s Chief Executive Officer and Chairman.
Its strategy of expanding the penetration in cryptocurrency mining business provided the huge support in increasing the revenue guidance. Digital Power recently added co-locations to its deployment strategy to achieve the goal of 10K cryptocurrency miners.
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Last week, the company entered its first co-location agreement. Based on this agreement, DPW has installed 1K additional units digitally mining the top 10 cryptocurrencies. Moreover, it has augmented the rate of installation of Bitmain Antminer S9’s from 40 per week to 100.
The company strongly believes that cryptocurrencies markets have strong growth potential and the selloff in prices from record highs offers the buying opportunity. “We believe the recent pullback of cryptocurrency prices does not reflect the long-term trend but instead offers opportunities,” says CEO Todd Ault III.
Its CEO was certainly right. Cryptocurrency mining business is likely to offer the support, as prices of top ten currencies recovered substantially in the last two weeks from the previous lows.
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