Digital Ally (DGLY) Stock Up 15% on 4Q Earnings

Shares of Digital Ally Inc. (DGLY) were up +$1.88 or +14.96 percent to $14.45 per share in premarket trading this morning. The stock is up this morning after announcing it fourth quarter results yesterday after the close. Digital Ally stock closed at $12.57, up +0.78 or +6.62 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.

Digital Ally reported fourth quarter 2014 non-GAAP net income of $0.05 per diluted share versus a non-GAAP net loss of -$0.50 per share in the fourth quarter of 2013. The company reported revenue of $5.4 million in the quarter compared to revenue of $3.5 million in the same quarter one year ago.

Fourth quarter gross margin increased to 59.3 percent of revenue versus a gross margin of 49.9 percent of revenue for the same period one year ago. For the full 2014 fiscal year, revenue fell -2 percent to about $17.4 million, while gross profit margin increased a fraction to 56.9 percent compared to 56.7 percent in 2013. For the full 2014 year, Digital Ally reported a non-GAAP adjusted net loss of -$0.56 per share compared to a loss of -$0.41 in 2013.

According to the company's press release, revenue in the first half of 2014 was negatively impacted by the actions of Utility Associates, Inc. The company sent threatening letters to Digital Ally customers and potential customers about the challenging economy and how they affected state, county and municipal government budgets which fund law enforcement agencies.

Revenue recovered in the second half of the year, primarily due to civil unrest in Ferguson, Missouri and the efforts of Digital Ally's legal team to stop Utility Associates letter writing campaign and to recover damages suffered by Digital Ally as a consequence. The revenue increase was also due to a $1 million order from a large state police agency for the company's DVM-800 in car video systems.

Digital Ally's Chief Executive, Stanton E. Ross stated that, "We have seen a large increase in inquiries, requests for test and evaluation units and pilot programs being conducted by police departments since the events in Ferguson last August. We are optimistic this will result in higher sales in 2015 as existing and potential customers evaluate our body-worn and in-car video camera solutions. Our patented VuLink connectivity device is also generating great interest among law enforcement agencies that recognize the value of collecting video evidence of interactions between officers and the public from multiple perspectives.

In addition to the better than expected fourth quarter results, Digital Ally announce that it had been awarded a patent for its latest LIDAR or Laser Detection and Ranging speed enforcement technology. The new technology will provide law enforcement agencies with an alternative to Doppler radar and stationary LIDAR speed guns. The new technology uses a laser pulse to determine a vehicle's speed.

Other News About DGLY

GoPro Could Thwart Digital Ally's Growth Potential

Article examining the possibility of competition from GoPro and how it would affect Digital Ally.

Digital Ally Files Motion to Assert Additional Claims In Its Unfair Competition Suit Against Utility Associates, Inc.

Company amends its complaint against Utility Associates in U.S. District Court.

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Published on Mar 24, 2015
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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