Make no mistake.
In fact, updates during September alone should have pushed AMMO well above its roughly
Frankly, savvy investors need to be acting on the value proposition now, with the understanding that the company is but a single press release away from surging higher. No joke. Despite investors overlooking its revised higher guidance of
And there's a number of reasons for why.
A Guided Surge In Revenues
Foremost, this vertically integrated producer of high-performance ammunition and components announced increasing its prior fiscal second-quarter revenue to approximately
Perhaps, even more, noting that it has not yet fully integrated its
A clue to that playing out came from the company, which said its transaction activity at GunBroker.com remains robust, even compared to last year's record-setting performance. Further, they were more bullish, saying that investors should not overlook the value from its implementing several initiatives intending to accelerate the growth, including engaging with manufacturers, distributors, and importers to expand the marketplace offerings. And with a record of speaking the truth and delivering on promises, it may be wise to follow that guidance.
Better still, they have the capital and means to back up their optimistic guidance.
Seizing Upon Demand
And that's the best part. AMMO can be trusted. Hence, when AMMO says that growth in its core ammunition business continues to be driven by strong underlying demand for its unique, high-performance products, for investors, it means "higher revenues."
And since consolidating all manufacturing operations this past April in its
And that's on the consumer and government sector side. Potentially transformational product orders can come from the military, similar to its September announcement of being awarded a contract from the
Also understandable to those that follow the sector and similar contracts know that the value of these contracts can quickly add up into the billions of dollars. Better still, it's unlikely that super-specialized ammunition, like AMMO is developing, can be bid on by other suppliers. In fact, mixing and matching artillery isn't the most common practice for
Quickly, the product deserves attention. It's indeed a dynamic product being developed to provide warfighters with the ability to see the impact of rounds fired from their weapon systems on a wider variety of targets, both day and night. The specialized SoT ammunition also allows the machine gunner to see bullet impacts without a visible signature in-flight to expose their firing location. For
Better yet, its advanced capability will increase survivability by reducing firing position identification and ultimately increasing lethality by supporting the shooter to place more rounds on target. In short, it's a product development and supply program that should have already sent valuations soaring. Still, it's only one part of the value proposition.
But it does show that
Optimism Abounds In 2021-22
Another value driver in plain sight is AMMO's reported
Thus, with at least
There's more excellent news there, too. This time the laws of supply and demand should take over, with AMMO again getting the better end of the deal. And those laws should benefit AMMO even more after a
Still, we haven't gotten to the best part, the value that comes through the revenue-generating strength and potential from GunBroker.com. Clues were again provided by AMMO management, who said during its earnings call that a fully integrated GunBroker can be a massive contributor to new revenues. They noted that only about
That makes sense, especially after noting that the millions of active users at Gunbroker.com only contributed about 3% of its revenues from gun and ammunition sales. Part of that was not having a supplier at its side. Now, that's changed. Hence, AMMO inherits an enormous revenue-generating opportunity from that group alone.
And with a report in
Justify The Surge
Then, factor in that its new facility is designed to quadruple production to meet demand from its presence in more than 1600 direct-to-consumer locations. Combined, the sum of its parts validates AMMO's bullish posture.
Further, despite its small-cap price, those parts also demonstrate that AMMO is in the big leagues as an ammunition and munitions company. Keep in mind, they already expect to sell upwards of 750 million rounds of ammunition this year. And that's not including its newly awarded military contract that could exponentially increase those totals.
Better yet, as AMMO continues to integrate its Gunbroker.com asset, it can leverage being in its best position ever to capitalize on the combined
The bottom line- keep
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