OPTEC International delivered a stellar earnings report on October 7th. By all metrics, OPTI earnings were a home run. Unfortunately for the bulls, shares closed lower on the day by 2.72%.
What in the world happened?
Well, take a look at the chart below and look at the price action on October 6th.
It doesn’t take a rocket scientist to figure out that someone front-ran the earnings report and then dumped. VWAP on the 6th was $.03 and OPTI got as high as $.0646 after earnings hit the tape. Someone doubled their money at least. Take this selling pressure and combine it with short-sellers and market-makers playing games, and you get a lower close on the day.
We know it’s disappointing, but unfortunately, this is all too familiar to us here at Insider Financial. This happens every day on the OTC Markets. All we can say is welcome to the world of penny stocks.
So what’s next?
Well, in this article, we aim to answer that question on how we think the next few weeks will play out for OPTEC International shareholders.
First up, here’s a little background info for those not familiar with OPTI stock. With two locations in California, OPTEC International is a developer and manufacturer of electronic LED, Ultraviolet (UV) & UV-C safety products, and related advanced technologies and PPE (Personal Protection Equipment) products. The company’s Safe-Scan product line is being launched at a time when HR directors and facilities managers are experiencing extreme concern with respect to keeping environments safe during the global pandemic crisis and the safe reopening of the U.S. economy.
OPTEC International Earnings Report
OPTEC International surpassed its $4,000,000 projection for this quarter and, in fact, showed revenue and income totaling $6,284,609 and a net income of $3,381,730.
In addition, the Company paid in full all previous convertible institutional notes and the interest and liabilities associated with those notes. The only commercial promissory note remaining will be the premium to market loan when fully funded from a financial partner, RB Capital Partners, Inc.
The company has been involved in the sale of larger wholesale transaction quantities of 3M KN 95 masks during this period, adding significantly to the company’s revenues and profitability. OPTEC said that it is currently in additional negotiations for significantly larger wholesale mask transactions and due to the size of these transactions will publicly announce upon closing/completion of the same.
The two provisional patents assigned to the company by the “Inventor” company CEO Roger Pawson, are presently being assessed as to a valuation by a professional established patent appraisal group. The professional valuation will be published upon receipt. A conservative estimated valuation was displayed in the valuation statement under the asset’s category, and not included as a financial value in the total assets tab. The professional valuation should be included in the official quarterly report published on OTC Markets by November 15th, 2020.
All Previously reported Institutional convertible notes have been fully paid as of September 30, 2020.
UV and UV-C products
We believe COVID is here to stay for a long time. If they have not developed a vaccine for the flu, common cold, or HIV, we don’t see how they can safely develop a COVID-19 vaccine in such a short amount of time. The only true option then is safety and testing.
OPTEC International has a suite of products that effectively kills 99.99% of virus, bacteria, germs, and other harmful contaminants based on SGS testing (the world’s leading inspection, verification, testing, and certification company).
The iWand is a portable UV-C LED disinfection device equipped with aviation aluminum, military-grade hardening treatment. The iWand comes with a powerful UV-C light eliminating the use of harmful chemicals such as bleach, ozone, and ammonia. The iWand provides an effective, proven, non-toxic cleaning solution that protects people from harmful bacteria and ultimately prevent illnesses and diseases.
On The Stock Day Podcast, OPTEC International CEO Roger Pawson said the company’s “products basically use UV and UV-C light to sterilize and disinfect in lieu of toxic chemicals and traditional cleaning.” Pawson elaborated on the Company’s portable UV-C disinfection wand, which is a reliable and efficient device for eliminating harmful bacteria. “Almost anything that can transfer bacteria to your hands you can sterilize,” said Pawson.
OPTEC International proved in its latest earnings report that there is strong demand for its products, both domestically and internationally. Distributors are necessary to move volume. On The Stock Day Podcast, CEO Roger Pawson said “we actually have a number of new distributors both here and internationally,” shared Pawson, adding that the Company is working on including the full distribution list on their website.
“Has anyone asked you to do a white label yet?”, asked podcast host Everett Jolly. “Yes, our Greek distributor has asked about that, as well as our Israeli distributor,” said Pawson. “Most of the international distributors that we’ve signed or are in discussions with are looking for white labels, and we can accommodate that.”
OPTEC International Rover Line
OPTEC Rovers 1, 2, and 3 use medical-grade UV technology to sterilize 1,000 sq. ft., 2,000 sq. ft., and 3,000 sq. ft. spaces respectively. The Rover 1 is an ideal soliton for classrooms and hospital rooms between 500-1,000 sq. ft and the Rovers 3 and 4 are the perfect sterilization solution for larger spaces such as warehouses, gyms, auditoriums, conference areas, and more.
These products are especially critical in light of the recent spike in reported cases in large gathering areas including college campuses across the country. The CDC’s updated guidance generates a new level of severity when it comes to air sterilization. Optec has already been providing companies, schools, police departments, and countries with its UV-C sterilization products and is primed for wider distribution given the increased demand.
OPTEC International KILLING BACTERIA
Ultra-Violet light is now the world’s most advanced solution for killing bacteria. UV-C LED technology falls directly in line with the company’s main goal of global sustainability. Eliminating the use of harmful chemicals such as bleach, ozone, and ammonia, UV-C provides a better, safer clean environment.
UV-C works because when exposing microorganisms to UV-C light, the light penetrates through their cell wall and disrupts the structure of their DNA molecules – prohibiting reproduction. By deactivating the DNA of bacteria, viruses, and other pathogens, it destroys their ability to multiply and cause disease.
Specifically, UV-C light causes damage to the nucleic acid of microorganisms by forming covalent bonds between certain adjacent bases in the DNA. The formation of such bonds prevent the DNA from being unzipped for replication, and the organism is unable to reproduce. In fact, when the organism tries to replicate, it dies.
Ultraviolet technology is a non-chemical approach to disinfection. In this method of disinfection, no harmful chemicals are added which makes this process simple, safer, more effective, and low maintenance.
OPTEC International has filed several patent applications in recent months and recently received provisional patent approval for the integration of digital touchless temperature scanning technology into cellphones and tablets as registered with the US Patent Office. This now allows the company to officially state the technology is “Patent-Pending”.
OPTEC International secured a $5,000,000+ funding approval with California based RB Capital Partners, Inc. RB Capital has agreed to provide funding to the Company in the form of premium to market 12-month promissory notes. The minimum amount of funding that RB Capital has agreed to provide to the Company under these terms is $5,000,000 payable during the next three to six months period.
The proceeds will be used for further development, increased production, and distribution of a suite of UV-C sanitization products that the Company can’t keep on the shelves due to increased demands. Currently, a prominent San Diego school district has deployed the touchless temperature scanners in addition to the Rover room sanitizers, and the Company is in talks with other local school districts to help safely re-open in person tuition. The company is also in discussion with a popular non-profit fitness organization to help safely re-open indoor activities.
OPTEC International Bottom Line
We know the bulls are disappointed with the price action after earnings. Our advice is not to focus on the day-to-day movements but look at the long-term picture. That is where the big money is made.
In the last three months alone, OPTEC International averaged $1.1 million in net profit EACH MONTH! We don’t know another stock trading under $.10 posting these numbers. When you also factor in that there are NO OUTSTANDING convertible notes, you have all the makings of a home-run investment. Now is a great time to pick up cheap exposure before the next big run.
As always, good luck to all (except the shorts)!
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Disclosure: We have no position in OTCMKTS:OPTI 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.