Dais Analytic Corp (OTCMKTS: DLYT) stock has started bottoming out, on the company reaffirming future revenue growth. The launch of updated ConsERV Energy Recovery Ventilator products is one of the developments strengthening market sentiments. Investors taking note of a 250% increase in revenues for fiscal 2018 might also explain the recent bounce back.
Dais Price Analysis
Amidst the bounce back, Dais finds itself languishing near all-time lows after shedding more than 80% in market value, since the start of the year. The stock is currently trading at the $0.0047 level after succumbing to soaring short-selling pressure.
An underlying long-term bear trend is the latest tailwind standing in the way of the stock eliciting more buying pressure from bulls. As it stands, the $0.01 is the immediate resistance level standing in the way of further upside action. A rally-followed bay close above the critical resistance level should reaffirm the stock’s bounce back credentials.
Conversely, failure to rise and find support above the critical resistance level could give short sellers a reason to come back and continue pushing the stock lower. For Dais to keep the bullish momentum going and bring in the real momentum players, it needs to rise and stabilize above the $0.01 technical level.
Dais bills itself as a nano-structured polymer technology Company. The company is engaged in the development and commercialization of products that use nano-structure polymer technology. Its lead product is ConsERV an energy recovery ventilator that addresses indoor fresh air requirements for various forms of ventilation.
Revenue Growth Milestone
A lack of new press releases might explain Dais underperformance in recent months. The company is yet to issue substantial updates affirming long-term prospects and grow prospects. However, the announcement of a 250% increase in FY2018 revenues in 2018 to $1.4 million is a development that underscores growth in the core business.
Revenue growth for the full year was driven by sales of the company’s patented Aqualyte membrane, used in food preservation applications. Gross margin for the full year was up by more than 400% to $459,857. Net loss for the full year was down 32% to $1.6 million compared to $2.5 million reported in 2017.
Dais attributes revenue growth and margin expansion to technology improvements as well as product cost reductions. Continued attention to operations and customer service also helped Dais register an impressive fiscal year.
“We expect to make new strategic partnership announcements in 2019 as we seek to drive continued growth in food preservation, HVAC, energy efficiency, and water treatment industries. Our priority and focus remain on building a profitable nanotechnology material-based platform business,” said Tim Tangredi, President and Chief Executive Officer of Dais.
For the current fiscal year, Dais expects Aqualyte nanomaterial sales to existing and new commercials partnerships to drive revenue growth. The company is also pursuing OEM partnerships in a bid to kick off sales for the Polycool product. The company is also planning to expand sales operations for its lead ConsERV products in international markets more so China. The new products provides the company with greater exposure to HVAC systems market, requiring up to 5,400 cubic feet of ventilation airflow.
“Moreover, with the wider Aqualyte membrane material the Company is introducing, there are more reasons for their customers to buy Dais products. We are setting new industry standards, allowing our clients to choose from a variety of products, tailored to serve the needs of small and large HVAC systems,” said Mr. Tangredi.
Dais stock has started making the right moves after a harrowing plunge in 2019. A spike in trading volume has since seen the stock bottom out from all-time lows. We are waiting to see if the upward momentum has what it takes to fuel a breakout. This will be confirmed over the next few days.
While the stock hangs in a precarious position after the underperformance of the past few months, revenue growth as well as narrowing of net loss paint different picture. FY2018 financial results indicate that the company’s core business is growing at an impressive rate if a 250% increase in revenues is something to go by.
In our view, robust revenue growth and narrowing net loss are potential catalysts that should continue to fuel a bounce back from current lows. The company embarking on a commercialization drive of its underlying products is another development that affirms long-term prospects. For DLYT shareholders, the rounding bottom chart pattern indicates a turning point and the stock looks set to continue climbing higher.
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Disclosure: We have no position in DLYT and have not been compensated for this article.