Is The Cloud Computing Industry Set To Explode In 2016? Fusion Telecommunications Int’l, Inc. (FSNN), Gawk Inc (GAWK)
In today’s world investors have many more options available than in the past. Among these options are companies focused on “the cloud”. Nasdaq stated that last year revenues for cloud services increased by 60%. On top of that, cloud computing is projected to see continued growth at a healthy rate over the next five years. If you are thinking of investing in a technology-based company, there are many upsides in doing so. By buying stock in a company who provides cloud-based services, you will have an opportunity to gain profits from the huge growth of this industry. According to a study initiated by Forrester, the cloud computing market is expected to grow from $58 billion in 2013 to more than $191 billion by 2020.
[quote]”Revenues for cloud services increased by 60%”[/quote]
Which now brings us to two companies utilizing their opportunity in this rapidly growing industry. Fusion Telecommunications Int’l, Inc. (NASDAQ:FSNN), a leading provider of cloud services has recently announced it has acquired Fidelity Voice and Data. Fidelity provides cloud voice, could connectivity, security, data center and cloud storage services to almost 2,000 small, medium and large business customers throughout the United States.
The CEO of Fusion stated, “The acquisition of Fidelity brings Fusion closer to its goal of building significant scale in the fragmented but rapidly growing cloud services market. Fidelity will also contribute to Fusion’s organic growth, accelerating Fusion’s progress over the last year in expanding its business.” This past week Fusion shares were trading up almost 58% at $3.48, with an agreed analyst price target of $6.00 as well as a 52- week trading range between $1.83 to $5.43.
The potential for investors in the space continues to grow. Look at a company like Gawk Inc (OTCMKTS:GAWK) who has already had some comparison to Fusion Telecommunications Int’l, Inc. (NASDAQ:FSNN). GAWK offers a suite of cloud communications, cloud connectivity, cloud computing, and managed cloud-based applications solutions to small, medium, and large businesses and offers domestic and international voice services to communications carriers worldwide. The company already has a presence in 21 countries and 31 cities with 16 of those cities are located in the U.S. On Nov. 17th the company announced they have acquired all assets of Connexum LLC.
This acquisition will increase Gawk Inc (OTCMKTS:GAWK) annual revenue to $6 million. GAWK reported its best quarter since it has begun traded, reporting that revenue increased by 952%. GAWK currently has a smaller market cap than Fusion at $1.8 million and has seen a 52 week trading range between $0.003-$0.125. The stock currently trades between 0.009 and 0.02. With such a market cap and the addition of new revenues, GAWK could certainly be on the radar of many, larger cloud companies. Look at 2015’s Cloud M&A already!
In January, Equinix Inc (NASDAQ:EQIX) acquired Nimbo, a professional services provider that helps enterprises develop and implement hybrid cloud IT architectures. Pete Hayes, Equnix’s chief sales officer, noted that the Nimbo acquisition would allow his company “to help customers leverage Equinix Inc (NASDAQ:EQIX) unique cloud-density and Cloud Exchange value propositions and assist with the design and deployment of hybrid cloud solutions.”
[quote]In April, Nokia Corporation (ADR) (NYSE:NOK) announced plans to acquire Alcatel-Lucent (ALU) in an all-share transaction valued at approximately $16.6 billion. Together, both companies will join forces “to create the foundation of seamless connectivity for people and things wherever they are,” according to Nokia. “I firmly believe that this is the right deal, with the right logic, at the right time,” Nokia Corporation (ADR) (NYSE:NOK) CEO Rajeev Suri said in a prepared statement.[/quote]
[quote]In March, Proofpoint Inc (NASDAQ:PFPT) reached an agreement to acquire open source cyber threat intelligence provider Emerging Threats for approximately $40 million in cash and stock. Proofpoint Inc (NASDAQ:PFPT) CEO Gary Steele said he believes that Proofpoint and Emerging Threats together can deliver “the most timely, actionable end-to-end attack intelligence and protection available in the industry.”[/quote]
Singapore Telecommunications Limited (Singtel) in April announced it would acquire Chicago-based managed security service provider (MSSP) Trustwave for $810 million. Singtel supports more than 500 million mobile customers worldwide, and the Trustwave acquisition could help this Asian communications company capitalize on a rapidly expanding managed security services market as well.
[quote]EMC (EMC) last week agreed to pay $1.2 billion in cash to acquire cloud software and infrastructure-as-a-service (IaaS) provider Virtustream. The cloud computing and big data giant said the Virtustream acquisition enables EMC to provide additional support for its cloud-based services.[/quote]
CytoDyn Inc (OTCMKTS:CYDY) Regains Momentum After The Big Announcement
Now that the market seems to be coming back into his elements, it could be time for investors to start looking into penny stocks more closely. These stocks may often be risky, but if one makes the right choice, then the rewards could be enormous. One penny stock that could be put into the watch list at this point in time is that of CytoDyn Inc (OTCMKTS:CYDY).
The late-stage biotechnology company, which is developing the coronavirus medicine leronlimab, announced last week that it had filed a comprehensive application for uplisting on NASDAQ. The company announced that it believes that its application satisfies the myriad listing requirements of the NASDAQ Capital Market.
The Chief Executive Officer and President of the company Nader Pourhassan stated that while it is true that the entire process is expected to take many weeks, CytoDyn is hopeful of success in this matter.
He went on to state that a listing on NASDAQ will not only provide shareholders with more liquidity but also give CytoDyn much bigger access to fresh capital. It is a significant development for the company, and the market participants realized it as well. After the announcement was made, the stock rallied by as much as 50%. Investors could do well to keep an eye on the stock this week.
While the rally following this announcement was a welcome relief for the company, it is important to point out that earlier on in the week, the stock has fallen considerably following a setback. Last Monday, the company announced that the United States Food and Drug Administration handed CytoDyn a refusal to file a letter with regards to the usage of leronlimab to treat HIV.
However, at the same time, investors should be noted that the company did announce that it is confident of furnishing the agency with all the further details that have been demanded. It is one of the penny stocks that have performed remarkably well this year so far, and investors could keep an eye on it.
These 3 Pot Stocks Are Up Big Since May: What’s the Buzz?
Over the course of the past year or so, pot stocks had generally struggled, but during the past month, those stocks have recovered nicely. The stock market suffered a historic fall due to the economic turmoil caused by the coronavirus pandemic. It is believed that investors who are looking for value have descended on the beaten-down pot stocks. On the flip side, these stocks could also have been identified as defensive plays in an uncertain market environment.
That being said, it should be noted that despite the gains recorded by many stocks, most of those stocks are still considerably lower than the all-time highs. In such a situation, it could be worthwhile for investors to take a closer look at some of the strongest and more stable cannabis companies in the industry. Here is a look at three pot stocks that made significant moves in May and could be tracked by investors at this point.
1. HEXO Stock Jumps Ahead of Earnings
HEXO Corp (TSX:HEXO) (NYSE:HEXO) is one of those cannabis companies which have had a particularly tough time over the past year or so. However, the stock has emerged as one of the bigger gainers among pot stocks in recent trading sessions. The Hexo stock has gained as much as 120% over the course of the past month. The company is all set to release its financial results for the fiscal third quarter on Thursday, and hence, it could be a big week for the stock.
The recent surge in the Hexo stock may have come as a major boost to investors, but it should be noted that over the past year, it recorded considerable losses. The beaten-down nature of the stock may have contributed to the stock becoming more attractive for investors. However, the trajectory of the Hexo stock in the near term is going to depend a lot on its third-quarter earnings.
The company had made a loss of $298 million in the previous quarter, and while it is almost certain that it is going to make a loss again, the size of the loss is going to be keenly watched. Additionally, any writedowns are also going to be harmful to the stock. Investors should also keep an eye on sales growth.
2 Organigram gains Momentum on Value Buying
Organigram Holdings (TSX:OGI) (NASDAQ:OGI) is another pot stock that has made significant gains in the past month. Since May 13, the stock has gained as much as 80%. In April, the company announced its fiscal second-quarter results, but it had been a disappointment.
Revenues dropped by 13.7% year on year to hit CA$23.2 million, and losses widened to CA$6.8 million from CA$6.4 million in the prior-year period. However, one significant cause for optimism for Organigram investors is the fact that in the second quarter, cannabis 2.0 products made up as much as 13% of its revenue. That has opened up a whole new opportunity for the company.
Wholesale cannabis revenue made up 24% of the net, and that is again a new source of revenue. The company blamed the lower volumes of flower as well as cannabis oil for the drop in sales. Organigram reported cash and cash equivalents of CA$41.1 million as of February 29. Considering the fact that it has burned CA$25 million in the past six months, investors should not use that the cash balance does not paint a pretty picture.
3 Aphria Recovers Following Solid Earnings
Aphria (TSX:APHA) (NYSE:APHA), on the other hand, managed to perform relatively well in its fiscal third quarter. The net sales rose by as much as 19.7% sequentially to hit CA$144.4 million, and more importantly, the company also managed to record a profit for the third time in four quarters. On top of that, it should be noted that although the Canadian cannabis company spends CA$124.4 million on its operations in the nine months trailing that quarter, it still reported a cash balance of CA$515 million.
The performance seems to have buoyed market participants as well, and the stock has rallied by as much as 75% since the middle of May. One of the most important things that investors are going to be looking into is whether Aphria is going to be able to maintain its profitability.
However, due to the turmoil caused by the coronavirus pandemic, it might prove difficult. That being said, it should be noted that the pandemic is going to have an equally damaging effect across the sector.
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