Edison Nation , Inc. ( EDNT )
Alert Price: $2.04
Website | Recent News
We are kicking off this fresh week of trading with a low-float Nasdaq listed alert with tremendous upside potential.
Please turn your attention to Edison Nation , Inc. ( EDNT ).
Like several of our recent winning trade ideas, EDNT is a low float alert trading at the lower end of its 52-week .
However, EDNT trades on the NASDAQ exchange, which makes it visible for potentially a bigger audience than normal OTC ideas.
We love these Nasdaq listed alerts because they tend to have more liquidity and higher investor confidence.
Speaking of investor confidence, you'll be happy to know that EDNT just reported blockbuster numbers which have us in this 2nd half of 2019.
Revenue and Gross Profit for the Second Quarter of 2019 Increased 36.0% and 61.8%, respectively
Catalysts for EDNT
A low float of just 2.9Mn shares.
Announced they are expanding on their inventor platform by adding two new features “Edison’s Design Challenge” and Entrepreneur Partnership.
Announced that Apothecary Products, a global leader in consumer wellness , has licensed the Ezy Dose Medi-Spout, a pill assisting bottle cap that utilizes patented technology to ease the swallowing of medication and vitamins.
Launched a new product line exclusively for its theme park and entertainment customers, which include Disney Parks and Resorts, as well as Universal Studios, among others.
Launched the "911 Help Now" pendant in March of 2019, in conjunction with a strategic sales and marketing association with Stealth Technologies, which had $800K in initial purchase orders from Audio America, a leading consumer electronics distributor.
Expanded sale of Goodie Gusher party product line into North America's retailers, growing its presence to approximately 640 retail store locations across the United States and Canada.
Introduced two new products in the toy and infant-sleep category: Lullaplayer and My Buddy Bernie. Lullaplayer is a children's MP3 player designed to look and feel like a classic portable record player. My Buddy Bernie is a voice activated, interactive playmate for kids that requires no set-up and works right out of the box.
Successfully entered the eyewear market in January 2019 with Smarter Specs, the first patented glasses with concave lenses, enabling consumers to wear the glasses higher up on the nose bridge, allowing them to look over the glasses without having to tilt their head down, easing neck strain.
Announced that Edison Nation is relaunching the Emmy award-fetching TV show, "Everyday Edisons." Everyday Edisons is an inspirational reality TV series produced under license by Edison Nation , which chronicles the stories of first-time inventors as they launch their unique products into the marketplace in conjunction with the Edison Nation product development platform.
Partnering with several Fortune 500 companies such as, Walmart, Target, Rite-Aid, Disney, Home Depot , and Amazon.
About Edison Nation , Inc.
Edison Nation , Inc. ( EDNT ), an inventor ecosystem driving IP , media and innovative consumer products. Edison offers innovation sourcing, design, sales, fulfillment and shipping services. Edison Nation's model is to source innovative ideas for internal launch or license to brand partners. Throughout 2019 and beyond, Edison Nation looks to establish prominence in the media space through its television show “Everyday Edisons” and additional properties such as Edison Academy. For more information, please visit http://www.edisonnation.com.
What does Edison Nation Do?
Since inception, Edison Nation has invested ~$11M to create a propriety open innovation platform, allowing inventors to safely and securely submit their ideas to be evaluated for various commercialization paths from licensing to, most recently, crowd funding.
Typical crowd funding product development cycle:
Edison Nation’s team of product designers and engineers then produce a ready for production prototype, and produce media in-house to launch a crowd funding campaign.
If a campaign is successful they will market the product in the “aftermarket” on sites such as Amazon & Jet
Products are generally manufactured in China with factories (we have 10+ year relationships, generally shipping within 4-6 weeks from order)
EDNT See Major Increase In Revenue and Gross Profit
Revenue and Gross Profit for the Second Quarter of 2019 Increased 36.0% and 61.8%, respectively; Driven by Successful Product Launches and Efficiencies Across Platform
"During the first half of 2019, EDNT achieved significant revenue growth of 49.7%, to $11.7 million, for the six months ended June 30, 2019, driven by the continued success of our IP and the scale of our consumer brands ,” said Chris Ferguson, Chief Executive Officer of Edison Nation . "The company continues to aggressively source innovative ideas via our proprietary Edison Nation Innovation Platform, which selects the ‘best-of-the-best' inventions utilizing proprietary algorithms, and brings them to market quickly. EDNT’s intellectual property, media, and consumer product launch engine will continue to drive growth in 2019 and beyond. Simultaneously, we are leveraging our combined platform to achieve significant operational and cost efficiencies”.
Financial Results for the Three Months Ended June 30, 2019
For the three months ended June 30, 2019, revenue increased 36.0% to $5.97 million, compared to $4.39 million in the same period in 2018. The increase in revenue was primarily attributed to successful product launches and scaling of EDNT’s acquired brands throughout 2018.
Gross profit increased 61.8% to $2.04 million in the second quarter of 2019, compared to $1.26 million in the second quarter of 2018. Gross profit margin was 34.2% in the second quarter of 2019, compared to 28.8%, in the same period in 2018. The increase is primarily a result of a favorable product mix of goods sold to customers.
• NASDAQ listed intellectual property and fully integrated consumer products company with three cored divisions:
Innovation – Unique Idea Submission Platform & Development of Intellectual Property
Build and Launch – Product and Package Development
Selling Division - Sale of branded products and custom products & packaging solutions
• March Q1 2019 Gross Revenue of $5.7mn
• Market Cap - $23.5mn based on approximately (6. 4mn shares outstanding as of June 3rd, 2019)
EDNT's Growth Strategy
Idea Submission & Selection Growth:
• The Return of the Emmy & Telly Award-Winning Show “Everyday Edisons”
• Mobile app version of Idea Submission Platform to debut Summer 2019
• Optimization of Idea/Product Selection using Big Data
Product Sales Growth:
• 6 Product Launches per quarter
• Sales growth via Omni-Channel approach
• Growth in DTC sales via Ecommerce Sales and Platform
• Purchase of 1-3 brands per year
• Achieve integration efficiencies post merger and brand acquisitions
• Economies of scale through increased product launches
Revenue from Idea Submission Platform:
Licensing fees: match an innovator’s intellectual property with category leaders (i.e. Black+Decker, Bed Bath & Beyond , etc.)
Innovator can earn up to 50% of licensing fee
Product principals: provide innovators direct access to all of EDNT’s resources to create & sell new products
Innovators may receive a licensing fee or a percentage of profits
Acquisition driven revenue:
We acquire quality micro-brands that are accretive and take them to the next level
October 2018 - Acquisition of “Cloud b, Inc” a leading children’s sleep products company (http://www.cloudb.com)
$6.0mn 2018 Revenue, Gross margin of 45% (proforma and unaudited)
Develop custom products and packaging solutions for well known partners:
Disney, Marvel, Madison Square Garden & Universal Studios
Key Paths to Product Revenue:
Direct-to-Consumer platforms - Amazon, Walmart.com, Kickstarter etc.
Brick and Mortar
April 2018 - raised $6.5M @ $5.00/share on Nasdaq
September 2018 - Acquisition of Strategic Partner - Edison Nation , LLC
Consideration – approximately $950,000 cash, 990,000 shares of common stock and $1.4mn convertible debt
October 2018 - Acquisition of “Cloud b, Inc” a leading children’s sleep products company (http://www.cloudb.com)
Consideration - 489,293 shares, earnout with fair market value of $520,000
~$6.0mn 2018 Revenue, Gross Margin of 45% (proforma and unaudited)
Brand Launches during Six Months Ended May 2019:
Goodie Gusher, Pirasta, 911 Help Now, SmarterSpecs, Trillion Trees and EcoQuest
Consumer Buying Habits are Shifting
The “retail apocalypse” is continuing as consumer purchasing habits trend towards online purchases.
The e-commerce market is expected to grow at a 13% CAGR to $682B by 2020.
Consumers are increasingly innovation driven with a need for instant gratification, as consumer desire for next-generation products surpasses the need for brand recognition.
The trend towards crowd funding (i.e. Kickstarter)is disrupting the legacy product development cycle through pre-ordering of products – financing product development while reducing sales risk.
Shifting consumer trends driving the growth of market places (i.e. Amazon) and crowd funding sites provide unique tailwinds for EDNT's growth.
As most of you know, we love low-float picks like this one because of their potential for huge single-session gains.
EDNT is looking extremely attractive at our alert price of $2.04.
Traders who start their positions at out alert price could see themselves in the perfect low-risk/high-reward scenario.
EDNT is trading well below its 52-week high of $7.83.
A run-up back to that 52-week high would show traders gains of up to +283%!
The Bottom Line
We believe that EDNT has the potential to be one of the biggest gainers on the Nasdaq.
As such, we are urging all members to act fast, start their research, and make sure to add EDNT to the top of their watchlist!
(*Remember to use a Stop-Loss Order or basic Limit Order to protect your gains, as well as limit possible losses.)
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