With the fall school season approaching, investors need to focus on the back to school plays. One company that we really like in the sector is Galaxy Next Generation, which we first covered in August and you can read here. The stock is unbelievably cheap trading under $.10 a share. Over the last few months, Galaxy Next Generation has announced millions of dollars in future revenues. In this article, we take a look at the bull case for Galaxy Next Generation and why any purchase below $.10 a share is a discount entry opportunity for a company with enormous potential.
Galaxy Next Generation
First up, here’s a little background info for those not familiar with GAXY on the OTC Markets. Galaxy Next Generation is a provider of interactive learning technology solutions that allows the presenter and participant to engage in a fully collaborative instructional environment.
Galaxy’s products include Galaxy’s own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. Galaxy’s distribution channel consists of 22+ resellers across the U.S. who primarily sell the Company’s products within the commercial and educational market. Galaxy does not control where resellers focus their resell efforts, although generally, the K-12 education market is the largest customer base for Galaxy products – comprising nearly 90% of Galaxy’s sales.
Classroom Technology Solutions Acquisition
Galaxy Next Generation is set to close on its acquisition of Classroom Technology Solutions in mid-October. This is a big deal as the company has generated over $35 million in revenues over the past 11 years. The deal is synergistic as many CTS products will enhance the current and future Galaxy product offerings. CTS has a robust portfolio of new products that will be released over the coming year.
CTS is a leader in the development of sophisticated technologies used in the education marketplace and other collaborative environments. Many of CTS’s products qualify for the “Made in America” distinction while others are a combination of U.S. and offshore products. CTS owns and markets several industry-recognized brands:
- “A-VisionMounts”, projector and flat-panel mounts, carts, and stands
- “ClassCam”, line of connected and wireless document cameras
- “ClassSlate”, wireless interactive tablets
- “TouchWorks”, interactive whiteboards
$1.5 Million Purchase Order
This month, Galaxy Next Generation received a follow-on purchase order of $1.5 million from an OEM customer to provide its innovative audio products and accessories for use in the K-12 education market. This purchase order for 2,200 units is in addition to the initial order of 1,000 units, which are currently being shipped. The purchase orders are being provided under a supply agreement for the 4,000 units in the first year and are renewable for up to two additional years. Gary LeCroy, Galaxy’s Chief Executive Officer, said:
“We are very pleased to have been chosen by this OEM customer to enable its audio system solution targeted for the K-12 education market. We believe that both its existing and future customers will be utilizing and implementing audio systems to integrate into their total district, school, and classroom technology solutions. Our OEM division is part of our vast expansion plan. As we continue to cultivate and grow the existing relationships we have, we are also developing new products and new relationships, with strategic partners, in our OEM distribution channel.”
Galaxy Next Generation $600,000 Order
Earlier, Galaxy Next Generation received a commitment for up to $600,000 in Cov-Shield products from a school district in southern Texas. The city is the top ten most populous city in Texas. The school district encompasses 31 schools for its more than 1,400 teachers and over 23,000 students. The commitment is for up to 35,000 Cov-Shield units as it gets ready to welcome back its teachers and students into a safe and protected classroom.
For those not familiar, Galaxy Next Generation sells Cov-Shield, a clear plexiglass barrier for personalized workspace for the U.S. education and business markets. The plexiglass shield product is ideal to help maintain distance and keep personal workspace safe as you can see from this photo.
Cov-Shield is available in a variety of sizes from 22-inch to 72-inch and is easy to set up, easy to move, and easy to clean. Gary LeCroy, Galaxy’s Chief Executive Officer, commented:
“With the CDC guidelines in-place and schools trying to figure out how to go back to school and still follow the guidelines, this product is necessary. We also believe Cov-Shield will be in-demand for the business market as companies, small and large, look to re-enter their offices toward the end of 2020 and early-2021. In fact, we have already pre-sold to a restaurant group. We look forward to rolling-out Cov-Shield and helping make the classroom, office, and restaurant a safer and cleaner environment.”
In addition to Cov-Shield, GAXY stock offers TeacherView. Highlights of “TeacherView” Powered by G2 Software:
- Remote at home, local at school, or hybrid classrooms
- Share teacher or student screens and video camera
- Distribute content and share websites
- Use multi-user whiteboard for collaborative learning
- Respond silently to electronic “hand raises”
- View thumbnails of students’ screens in real-time
- Work alongside or remotely take control of screens
- Keep students on-task and apply device usage policies
- Lock screens to maximize attention and minimize distractions
- Limit access by blacklisting and whitelisting websites and apps
- Conduct surveys and quizzes
Galaxy Next Generation Long-Term Potential
Galaxy Next Generation is no short-term play. The fact is that COVID-19 is going to be with us for a long-time. Investors realized this once it was reported that a Hong Kong man contracted the coronavirus twice in the same year. Most experts were under the impression that once someone had COVID-19, that they would be immune from catching it again. This new development has investors realizing that COVID-19 is going to be with us for a long time. The only solution is testing and prevention. This gives Galaxy Next Generation a tremendous runway for growth beyond schools as businesses will also need Cov-Shield.
The biggest worry when it comes to penny stock investing is dilution from convertible notes. Luckily, GAXY stock is taking steps to avoid dilution by paying off notes that come due like the company did back in March. This is a company working for its shareholders and not against.
On September 30th, Galaxy Next Generation will file its 10-K with the SEC. We are expecting strong numbers, but it’s the future that we are excited about. Just this month, the company signed deals for $5 million in revenues. This includes the CTS acquisition that will close mid-October. This makes shares tremendously cheap at current levels.
As we said in August and we will say it again, every school administrator in the country will be needing Galaxy’s Cov-Shield. Do the math and Galaxy Next Generation could be looking at hundreds of millions in revenues in the next few months. For those that doubt us, Galaxy signed up $5 million in deals just in September. Look for more to come in next month and beyond. It’s exciting times ahead. Buckle up and enjoy the ride.
As always, good luck to all (except the shorts)!
WHEN INSIDER FINANCIAL HAS A STOCK TIP, IT CAN PAY TO LISTEN. AFTER ALL, OUR FREE NEWSLETTER HAS FOUND MANY TRIPLE-DIGIT WINNERS FOR OUR SUBSCRIBERS. WE SPECIALIZE IN FINDING MOMENTUM BEFORE IT HAPPENS!
Disclosure: We have no position in OTCMKTS:GAXY or any of the securities mentioned. We wrote this article ourselves and it expresses our own opinions. We are not receiving compensation for it. We have no business relationship with any company whose stock is mentioned in this article. Insider Financial is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. This article is not a solicitation or recommendation to buy, sell, or hold securities. This article is meant for informational and educational purposes only and does not provide investment advice.