ToughBuilt (NASDAQ: TBLT) has not been a fun hold for investors who got in at the initial public offering (IPO) back in 2018. More specifically, the stock plunged over 98% since the IPO; however, investors have had a lot to be happy about recently as the company has improved its balance sheet, has strong top-line growth, and a fairly large total addressable market (TAM).
On July 11, the company announced that it managed to post $3.56 million in gross sales through Amazon (NASDAQ: AMZN), representing a 20% increase year-on-year (YoY), while sales for the first half of the year jumped by 24% to $7.01 million compared to $5.31 million in the first half of 2021.
Michael Panosian, Chief Executive Officer of the company, reiterated that sales through Amazon are a driving force for the company’s revenue.
“The Company’s growth remains significant despite unfavorable market conditions. Our sales through Amazon continue to be a driving force for ToughBuilt’s overall revenue growth. We look forward to expanding upon our product portfolio and revenue success.”
Meanwhile, the company’s shares are up 93.98% just over the past five days and over 36% alone in the last trading session while the stock continues to climb premarket.
TBLT chart and analysis
In the last month, TBLT has been trading in the $1.34 to $5.18 range, while currently trading near the high of this range. Volume is considerably higher in the last couple of days, while over the last month the stock is up a whopping 190%.
There seem to be two resistance lines on the daily chart, the first at $4.47 and the second at $4.64, while a support line is seen at $3.68.
Shareholder value dilution
Since the IPO the company managed to increase its share count from 1 million to 129 million, and it all came at the expense of shareholders as dilutions destroyed the trust market participants had towards the company.
However, as of now, the company is sitting on over $31 million of cash, which could bring it some respite in times of supply chain issues.
All things considered, TBLT appears enticing, with a strong presence in the tool market, cash reserves, and a skyrocketing stock. Yet, investors need to be cognizant of the company’s past and expect high volatility, especially in the case of a new stock offering from the firm.
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