As 5G continues to be rolled out across the globe, Addvantage Technologies Group Inc. (NASDAQ:AEY) is taking full advantage of Internet 2.0.
The Building out of the internet provided one of the greatest economic shift’s and investor gains witnessed in a generation. Today… we’re witnessing another tech investment event, that may even outpace the 1990s’ internet build-out.
What are some of the signs we’re seeing? In 2018, Apple officially became the first US company to hit $1 trillion in market cap.[1] Over the months that followed, Apple was joined by Amazon, Google, and Microsoft in the Trillion-Dollar Club. What do all of these giants have in common?… One word: TECH. And tech is EXPLODING, thanks to a game changer, that’s set to really launch in 2020 as more mobile carriers expand their network.
What is the next boom? It’s called 5G… and it’s going to increase internet speeds by 1,000 times. The impact will be phenomenal, with Qualcomm Technologies forecasting a 5G Economy will Generate $13.2 Trillion in Sales Enablement by 2035.[2]
In the USA alone, already the telecoms have doubled what analysts anticipated in an ongoing federal auction for 5G airwave licenses—reaching almost $8 billion.[3] Over the next 8 years, 5G is projected to grow at an explosive CAGR of 77.4%, and to reach a stunning $827 billion by 2028![4]
Beyond the mobile phone developers set to launch 5G-compatible smartphones, opportunities may exist via companies providing turn-key solutions, equipment, and infrastructure for the entire 5G revolution.
COULD THIS BE THE CISCO OF 2020?
Meet Addvantage Technologies Group Inc. (NASDAQ:AEY) —a still under-the-radar builder and upgrader of 5G and LTE wireless networks for the telecom industry. Addvantage sells, distributes, refurbishes, and services infrastructure and equipment for the coming 5G revolution.
As you can see, Addvantage Technologies Group Inc. (NASDAQ:AEY) stock has steadily climbed over the last 12 months from a low of $1.50 to a high of $6.49 in February 2020. Their stock price was effected as all were in the virus downturn but has been steadily rising.
At current pricing it is up +27% since last May! Investors are realizing the impressive potential this technology has and the stock has been on an uptick in recently as market recovers.
This is why so many analysts are giving this stock either a BUY or a STRONG BUY rating, including analysts featured or recognized by respected publications such as:
Yahoo Finance has given Addvantage Technologies Group Inc. (NASDAQ:AEY) stock a price target of $7.60[5] AND Bullish pattern detected. (Pictured Below)
- CNN Business – BUY
- Investing.com – STRONG BUY
- MarketWatch – BUY
AEY INSIDERS ARE BUYING!!!!
JAROD M WATSON – CFO – Acquired – $19,620 of AEY shares
JIMMY R TAYLOR – INSIDER – Acquired – $10,620 of AEY shares
DAVID HUMPHREY – CEO – Acquired – $37,999 of AEY shares
HARDEN SCOTT – Director – Acquired – $222,465 of AEY shares
SHELNUTT JOHN – Director – Acquired – $239,039 of AEY shares
SPARKMAN DAVID – Director – Acquired – $89,039 of AEY shares
FRANZ THOMAS – Director – Acquired – $89,039 of AEY shares
CHYMIAK DAVID – Director – Acquired – $38,312 of AEY shares
And this is all without mentioning what truly makes Addvantage Technologies Group Inc. (NASDAQ:AEY) stock unique—THIS IS AN EXTREMELY TIGHTLY HELD STOCK.
AEY has an almost unheard of low amount of shares outstanding… Only 11.79 million shares, in total! And among those shares, more than 56% are held by insiders, and as much as 11% are owned by institutions[7].
This means that there really are less than 3.89 million shares out there in play.
A float this low is practically unheard of. So this is why it’s very important to do your research when assessing companies such as Addvantage Technologies Group Inc. (NASDAQ:AEY). They really don’t come around very often… if at all. Which is why we believe 5G could be the second coming of the internet, and AEY deserves your attention right away.
Over the last year, ADDvantage grew its revenue by 101% in 2019 with $55.1 million in sales.[10]
Quick Educational Video on 5G
WHAT’S NEEDED FOR A 5G EXPLOSION
It’s been a 46-year journey to the 5G wireless communications network. 5G stands for “Fifth Generation” network. The first generation grew in the 1980s and involved large brick-like phones that could only make calls.
The second generation of networks launched in the 1990s, and gave users the first opportunity to send texts. The third generation (3G) gave devices access to broadband technology, making it possible to browse the web, shop, and enjoy entertainment.
The fourth generation (4G) finally gave us the ability to stream videos without having to wait to buffer. This opened up devices significantly to what’s now called the “sharing economy”.
However, the biggest, most advanced wireless network breakthrough is on the verge of exploding onto the scene. We’re not just talking faster phones. This revolution will involve self-driving vehicles, smart homes, smart cities, VR, robots, quantum computing—the possibilities are truly endless.
The new Speeds that 5G provides is truly extraordinary!!
In China, equipment makers and network operators have already facilitated China’s first remote diagnosis of the deadly 2019-nCoV coronavirus using a 5G network.[8] Noted 5G expert Matt McCall predicts that the long-term winners in the sector will be 5G gear makers, 5G infrastructure providers, and specialized chipmakers. Some researchers are even predicting the global 5G market will go from $31 billion in 2020 to $11 TRILLION by 2026.[9]
Addvantage Technologies Group Inc. (NASDAQ:AEY) covers two of the most important segments of the 5G revolution. Through its Wireless Segment, Fulton Technologies builds and upgrades networks for wireless carriers, tower companies, and equipment OEMs.
Via its Telecom Segment, Nave Communications and Triton Datacom, Addvantage Technologies Group Inc. (NASDAQ:AEY) distributes, repairs and services a comprehensive line of new and refurbished electronics, boards, switches, phones and hardware for the telecommunications core networks and enterprise industries.
The Who’s Who of customers!!!
Primed and Ready to Service Tomorrow’s 5G Revolution… TODAY
Knowing what you know today, imagine what it would be like to have invested in the massive buildout of the internet in the 1990s. Not the companies that lost money with the intensive costs of laying the cables and fibres down… those lost money.
No, the ones that made money are the companies that serviced and upgraded the system as it was built. That’s precisely where Addvantage Technologies Group Inc. (NASDAQ:AEY) has positioned itself.
The company’s growth has been very impressive.
Over the last year, ADDvantage grew its revenue by 101% in 2019 with $55.1 million in sales.[10]
And the beauty about it all is the company does not rely on a single large client to support its revenue.
EVALUATING THE RAPIDLY GROWING 5G FIELD
With it’s a current market cap of US$34 million, the market is only valuing Addvantage Technologies Group Inc. (NASDAQ:AEY) at less than 55% of its annual revenue, which is in stark contrast to its 5G peers.
Just look at how much revenue the companies in the 5G space are generating already, and the value the market is giving their stocks.
Field of 5G Comparables
It can’t be ignored that the market is giving 5G-related companies a positive MarketCap-Revenue valuation, with ratios ranging from 1.5:1 to 9.32:1.
However, it seems to be slow on the uptake when it comes to Addvantage Technologies Group Inc. (NASDAQ:AEY) which grew its revenue in 2019 by 101% to over US$55 million.
SIGNIFICANT REVENUE GROWTH POTENTIAL
“In just our first nine months of operating, our Wireless Segment, Fulton was able to achieve revenue of $22.9 million as we continue to integrate and ramp up the operation, demonstrating Fulton’s growth potential.”[20] – Joseph Hart, President and CEO of ADDvantage Technologies.
Through the acquisition of Fulton Technologies, ADDvantage has perfectly complemented its Telecommunications Segment. ADDvantage was able to also retain the majority of the subsidiary’s existing employee base, and go on to recruit more strong industry talent.
With the official rollout for 5G and the required densification of 5G networks, ADDvantage is prepared for an oncoming wave of opportunities. Growing demand for 5G technology is set to trigger investment across all network domains.
Year-over-year, Addvantage Technologies Group Inc. (NASDAQ:AEY) witnessed its sales increase 182% to $17.9 million for the three months ended September 30, 2019 (compared with $6.3 million for the three months ended September 30, 2018). The increase in sales was absolutely driven by increases in revenue in both the Wireless and Telco segments.
Addvantage Technologies Group Inc. (NASDAQ:AEY) is perfectly positioned to provide turn-key wireless infrastructure services and network and enterprise communications equipment to the telecom industry nationwide.
For the largest network operators in the United States, Addvantage Technologies Group Inc. (NASDAQ:AEY) provides best-in-class site acquisition, installation, integration and maintenance services, as well as providing program management and technicians to upgrade to the latest wireless technologies.
This company specializes in all types of macro, specialty and temporary sites, as well as providing a broad range of experience with small cell deployments.
Addvantage Technologies Group Inc. (NASDAQ:AEY) are the experts in 5G expansion, helping their clients design, lease, permit, build and optimize world-class wireless networks. As 5G rolls out, it’s going to be ADDvantage delivering the important steps and equipment all along the way.
ONE OF THE INDUSTRY’S LARGEST INVENTORIES OF TELECOM EQUIPMENT
Prior to acquiring Fulton Technologies, Addvantage Technologies Group Inc. (NASDAQ:AEY) was already a dominant force in telecommunications.
Through its subsidiaries Nave Communications and Triton Datacom, ADDvantage offers a broad range of new telecommunication products to its telecom customers.
The company sells surplus-new and refurbished equipment, that it purchases in the market as a result of network upgrades or an overstock in OEM warehouses.
Now Addvantage Technologies Group Inc. (NASDAQ:AEY) successfully maintains one of the industry’s largest inventories of new and refurbished equipment. Through continuing to upgrade its new product offerings ADDvantage stays at the forefront of the communications broadband technology revolution—specializing in particular with optical and IP based networks.
If its clients don’t need new equipment, and rather need older equipment dealt with, ADDvantage’s subsidiaries have them cover there too. They provide decommissioning services for surplus and obsolete equipment, which they in turn process through their R2 certified recycling program. Overall, their repair services span the majority of all major brands of network equipment, and over 10,000 product SKUs.
Addvantage Technologies Group Inc. (NASDAQ:AEY) provides practically all needs of its wireless and telecommunications clients, making them invaluable to the entire 5G revolution.
An Experienced Management Team Looking To Take Addvantage Technologies Group Inc. (NASDAQ:AEY) To The Next Level
Along with Joseph Hart, the managers and directors of ADDvantage Technologies Group are a veritable “Who’s Who” of the technology, financial, scientific, entrepreneurial and investment sectors.
Joseph E. Hart – CEO and Director
Former 25-year AT&T Executive, Joseph Hart has officially been the CEO of ADDvantage Technologies Group, Inc. (NASDAQ:AEY) since October 2018, bringing his nearly 40 years of telecom industry experience to the company’s operations. Prior to taking the lead role with ADDvantage, Hart has held Executive roles, including CEO of leading telecom firms that performed installation, maintenance, network design and construction, end-to-end network infrastructure, field deployment, and more.
Kevin D. Brown – Chief Financial Officer
Since 2011, Kevin Brown has served as a Partner at private investment firm, 4M Investments. where he’s overseen its telecom infrastructure efforts and evaluating tower, fiver, DAS and small cell opportunities. Within 4M he’s also served in several executive positions within the firm’s portfolio companies. Brown was appointed CFO of ADDvantage in March 2019.
Colby J. Empey – President, Wireless
Leading ADDvantage’s Wireless Segment, Colby Empey has a track record of leading the successful operations through various executive leadership roles of tech and telecom businesses. Over his career he’s overseen hundreds of employees at a time, generated hundreds of millions in annual revenues, and contributed to building the first trial market for testing and analyzing LTE performance and commercially launching 3 of the first 5 LTE markets.
Donald E. Kinison – President, Telecommunications
Donald Kinison has over 20 years of sales experience in the telecommunication, software and cloud industries. Prior to joining ADDvantage, Kinison held Senior Vice President and General Manager positions for Impact Telecom LLC, Associated Network Partners, and Cbeyond, Inc., each providing a full range of telecommunication services for carriers, businesses, and homes. He was promoted to President of ADDvantage’s Telco segment in December 2018.
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Addvantage Technologies Group Inc. (NASDAQ:AEY) is poised to become a major player in the massive $30 billion 5G market—that’s projected to reach $11 trillion by 2026[23]—through building and upgrading wireless networks while distributing new and refurbished equipment to the telecommunications industry for core and enterprise networks.
8 Reasons Investors Should Examine
Addvantage Technologies Group Inc. (NASDAQ:AEY) Right Now…
- 5G is the next big thing since the internet in the 90s – a $30 billion market that’s projected to reach $827 billion in the next eight years… and $13.2 Trillion by 2035
- This year there are expected to be more than 50 billion internet connected devices, while 5G can handle 1 million connected devices per km2
- With only 11.79M shares outstanding, up to 56% insider ownership, and possibly 11.% institutional ownership, leaving approximately 3.89 million shares out there. AEY stock is extremely tight, and a float so low that it’s almost unheard of at this level.
- Addvantage Technologies Group Inc. (NASDAQ:AEY) increased its sales by 101% to $55.1 million in 2019, and its final quarter increased sales 182% year-over-year
- Compared to its 5G network and equipment peers, AEY’s market cap per revenue ratio (0.54:1) is drastically lower than the others which range from 1.5:1 to 9.32:1
- Through its subsidiaries, ADDvantage Technologies has one of the largest inventories of new and refurbished telecommunications equipment, and can service over 10,000 SKUs
- Early investors will gain “first mover advantage” on a company perfectly suited to capitalize on the 5G revolution, similarly to the internet builders of the 1990s
- The company’s management team is made up of experts who have had numerous successes in the telecom, wireless, network, DAS and small cell segments.
Final thoughts: We think Addvantage Technologies Group Inc. (NASDAQ:AEY) looks like it could be building some momentum in the markets, and is an all around solid company. As always, do your own due diligence and make sure to put this one on your radar.
Sources:
[1] https://money.cnn.com/2018/08/02/investing/apple-one-trillion-market-value/index.html
[2] https://www.qualcomm.com/news/releases/2019/11/07/5g-economy-generate-132-trillion-sales-enablement-2035
[3] https://fortune.com/2020/02/06/mobile-industry-5g-airwave-auction/
[4] https://www.globenewswire.com/news-release/2020/01/30/1977333/0/en/Global-5G-Market-and-Technology-Forecast-to-2028.html
[5] https://finance.yahoo.com/quote/AEY/analysis?p=AEY
[6] https://fintel.io/n/us/aey
[7] https://finance.yahoo.com/quote/AEY/holders?p=AEY
[8] https://www.businessinsider.com/zte-china-telecom-build-5g-telehealth-system-for-coronavirus-2020-1
[9] https://www.bloomberg.com/press-releases/2019-11-13/5g-market-are-going-from-31-billion-in-2020-to-11-trillion-by-2026-research-report-by-reportsnreports
[10] https://finance.yahoo.com/news/addvantage-technologies-reports-101-increase-210510726.html
[11] https://media.nxp.com/news-releases/news-release-details/nxp-semiconductors-reports-fourth-quarter-and-full-year-2018
[12] https://about.att.com/story/2020/2019_earnings.html
[13] https://www.fool.com/earnings/call-transcripts/2020/01/30/verizon-communications-inc-vz-q4-2019-earnings-cal.aspx
[14]https://www.globenewswire.com/news-release/2019/09/26/1921567/0/en/Micron-Technology-Inc-Reports-Results-for-the-Fourth-Quarter-and-Full-Year-of-Fiscal-2019.html
[15] https://www.prnewswire.com/news-releases/axcelis-announces-financial-results-for-fourth-quarter-and-full-year-2019-300999691.html
[16] https://www.marketwatch.com/investing/stock/amba/financials
[17] https://www.ceragon.com/news/ceragon-networks-reports-fourth-quarter-and-full-year-2019-financial-results
[18] https://investor.ciena.com/news/press-release-details/2019/Ciena-Reports-Fiscal-Fourth-Quarter-2019-and-Year-End-Financial-Results/default.aspx
[19] https://investor.extremenetworks.com/news-releases/news-release-details/extreme-networks-reports-fourth-quarter-fiscal-year-2019
[20] https://finance.yahoo.com/news/addvantage-technologies-reports-101-increase-210510726.html
[21] https://www.digitaltrends.com/mobile/what-is-5g/
[22] https://finance.yahoo.com/news/iot-chip-market-outlook-2020-153859966.html
[23] https://www.bloomberg.com/press-releases/2019-11-13/5g-market-are-going-from-31-billion-in-2020-to-11-trillion-by-2026-research-report-by-reportsnreports
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