Digital Ally (DGLY) Stock Up Big on Ferguson Unrest

Shares of Digital Ally Inc. (DGLY) were up +$1.25 or +10.0 percent to $13.75 per share in premarket trading this morning, after having traded as high as $14.50 or up +80 percent yesterday. The increase in the stock is in large part due to civil unrest in Ferguson, Missouri that boosted demand for their products. Digital Ally stock closed at $12.50 up +4.56 or +57.43 percent in Monday's regular trading session.

Lenexa, Kansas based Digital Ally Inc. produces and develops digital video imaging and storage components used in law enforcement.
The company's main product consists of a digital video rear view mirror designed for commercial fleets such as taxis and ambulances and vehicles used in law enforcement. The digital video recording systems are extremely rugged, weather resistant and can be used in boats, motorcycles and ATVs. Digital Ally also makes a video system designed to be worn on an individual's body by clipping the camera to a belt or pocket. Other products made by the company include a digital video flashlight and a hand held speed detection device. The company sells its products primarily to law enforcement agencies, security companies and operators of commercial fleets.

The company first drew attention on August 18th when an article in Time was published citing the mayor of Hawthorne, California calling for city police officers to use body worn cameras. Mayor Chris Brown urged officers to use the devices in the wake of civil unrest in Ferguson, Missouri after the fatal shooting of an unarmed teenager by a police officer on August 9th.

The violence in Ferguson also spurred a petition drive on the White House's website for law enforcement officers to wear cameras. The petition quickly garnered 100,000 signatures and is the leading petition on the website. The petition's creator, Johnlee Coe Jr. told reporters that if officers had been wearing cameras on the night of the shooting, most of the subsequent violence and looting in the St. Louis suburb could have been avoided.

A study by Cambridge University found that complaints against officers fell drastically after the officers began wearing cameras on the job. The study found that both officers and suspects were significantly deterred from violating rules while being videotaped.

In a conversation on Monday, Digital Ally's Chief Executive Officer, Stanton Ross told Reuters that he has been receiving offers for the company "all the time but would not disclose details until a letter of commitment was signed. "We have had a lot more enquiries because of the civil unrest that is going on over in Ferguson, he told the news agency.

While digital cameras account for only nine percent of Digital Ally's total sales, according to some sources, the market for wearable digital cameras in the United States could exceed $500 million. Digital Ally's market cap is currently $33.8 million.

Digital Ally's stock has had an amazing week. After the Time article, company shares doubled, trading from under $4 per share on August 19th to over $8 per share on the 20th. The stock then traded between $5.80 and $8.50 per share for the rest of the week.

Yesterday, the stock soared, gapping higher and trading over $14 per share on exceedingly high volume of 23, 875, 748 shares - more than the company's outstanding shares. The stock has is now up a whopping +224 percent since August 19th. Nevertheless, sellers have borrowed as much as 68 percent of outstanding stock to sell short, which could eventually propel the stock even higher.

Other News About Digital Ally
Is Digital Ally For Real This Time?
Article written on Thursday about the news flow nature of the stock's recent move.
Digital Ally, Inc. Announces Second Quarter Operating Results
Company reported a net loss of -0.43 per share versus -0.03 in 2013s Q2.

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Published on Aug 26, 2014
By Jay Hawk
Jay Hawk
Jay Hawk enjoyed a 12-year professional financial markets career incorporating extensive first hand futures and options experience obtained by trading in the stock, commodity and forex markets on U.S. exchanges. Since retiring as a full-time financial market professional, he has been actively trading stock, commodities, forex and options for his own account and managing funds for others, as well as writing financial market commentary and educational articles.

Copyrighted 2020. Content published with author's permission.

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