Blackboxstocks (NASDAQ: BLBX) is squeezing the short-sellers after the CEO went on the record to assure investors that management is well-aligned with its base to drive shareholder value higher sooner than later. On Friday, BLBX shares surged by more than 21%, reaching $3.47 intraday at press time. While below the $5.00 public offering price set two weeks ago, current prices may represent a more than compelling price point for investors looking for valuation disconnects. With a best-in-class trading platform and a working relationship with TradeStation to enhance its already comprehensive platform features, that consideration is both timely and wise.
Here's the better news. Besides having the assets to back up a significantly higher share price valuation, the company isn't sitting back to let apparent predatory short selling batter its investor base. Instead, the CEO shows and tells that his company's low-float capital structure is more than inviting from an investor's perspective; insiders and those who helped raise $12 million are indeed staying on board for the right. In fact, despite what is now debunked rumors, insiders have not sold a single share of BLBX stock. Better still, with only about 12.9 million post-IPO shares outstanding and many of those restricted, investors taking advantage of an apparent overzealous short-selling campaign may be ideally positioned to accelerate the pace of the squeeze.
Remember, share prices always represent two arguments. On one side, the stock is overvalued. On the other, they are undervalued. In this instance, BLBX shares appear to be well in the camp of the latter. Why? Because the company is accelerating growth, posting best-ever revenues, is making deals with industry leaders, and has a boatload of cash on hand to expedite an already ambitious growth plan.
Maximizing AN initiative To Deliver Shareholder Value
Put simply, Blackbox is creating shareholder value quarter over quarter by staying true to its mission of providing traders and investors with real-time information and insight into the stock market. And that commitment led to an enthusiastic response to its recent capital raise. Deservedly so.
After all, they invested in the obvious. Blackboxstocks, the platform, is revolutionary, fast, secure, analytical, and partnered with industry leader TradeStation. It's so good that users have referred to it as Robinhood on steroids. Perhaps its attractiveness is so strong that it rocked the sector boat just a little bit, leading coordinated trading groups to attack BLBX's low-float flank last week. Blog posts support that presumption.
But, every trade comes to an end. More so on the short side, where investors are left exposed to unlimited losses ahead of positive company updates. For the long, especially when intrinsic value limits downside, the position is far easier to carry. Moreover, when the company delivers supporting evidence that it's a business in motion, momentum to the upside is more than earned; it gains acceleration. BLBX is posting that evidence.
This month, Blackboxstocks reported Q3 and YTD results that were indeed impressive. Revenues increased by 34% to about $1.47 million compared to the comparative period last year. Even better, YTD, revenues surged by more than 90% to roughly $4.42 million over 2020 totals. Those gains are also dropping toward the bottom line, with Adjusted EBITDA nearing positive territory by posting only a $(23,320) loss for nine months ended September 30, 2021, a 73% improvement over last year. That's not all helping to make the bullish case. After quarter-end, BLBX completed a $12 million capital raise and uplisted to the NASDAQ Capital Market®. That deal and uplist open the door to a new class of investors previously unable to purchase shares in the company.
Thus, while the welcoming party was bumpy, having the resources and new NASDAQ listing should help BLBX bounce back quickly. In fact, the more than 21% spike on Friday is likely the precursor of better things to come.
Video Link: https://www.youtube.com/embed/wP35QHAb-X8
Coming To iOS And Android In Q4 2021
That's because BLBX is accruing its impressive growth without native iOS or Android apps for mobile devices. But that loss is short-lived. BLBX has said that availability in those app stores is expected to happen before the end of this year. That puts at least two milestones in sight.
And don't underestimate their impact. The new apps will immediately allow BLBX to market and cater to a much larger user base. In addition, with the proceeds from its recently completed $12 million capital raise, BLBX has all of the ingredients to scale faster and more efficiently than ever before. Thus, while an excellent value proposition before, it's an even better one now.
So, while timely for the season, catching shares on sale is also a massive opportunity for investors to maximize value in the coming quarters. Remember, fundamentals will take over. And when they do, the bias for companies with good ones, like BLBX, has an inclination to the upside. Thus, while some short-sellers have made some money, those still holding may get squeezed out of gains entirely by maintaining that position even a day too long. And with an arsenal of potentially good news ahead, it could become a heavy bag to carry.
Keep in mind that there are few, if any, arguments made against BLBX being a best-in-class trading platform. Thus, it's time to separate the stock from the asset. In that perspective, BLBX, the platform, is ideally positioned to take advantage of exponential growth in the retail trading markets. Notably, Forbes recently highlighted that the sector is in a period of hyper-growth, with unicorn investors already providing more than $91.5 billion in global funding this year. Better still, Forbes expects that that total is only the start of substantially more investment dollars to come.
Indeed, for BLBX, that's more than excellent news; it positions them ideally to capitalize on a perfect storm of revenue-generating opportunity by expanding its brand and putting its Blackboxstocks trading platform into the hands of millions. Yes, millions.
That's not at all an unreasonable target, especially after institutional investors ponied up $12 million to expedite BLBX growth and with its planned iOS and Android offerings. Moreover, if BLBX expects that, it's likely to happen. The company has a history of beating its ambitious expectations. They are proving that.
BLBX Prints Consecutive Growth
In Q2, Blackboxstocks Inc.'s revenues surged by 81% over the same period last year. Its six-month comparison was even better, with revenues soaring by 141% in the comparative period. Also important to note, those massive gains came with a tailwind, proven last week when Q3 revenues spiked by 90% YoY. Better yet, even with some seasonality in play, guidance is bullish. And BLBX has reasons to be confident.
In fact, while growth is already strong, BLBX is leveraging the strength inherent to a strong balance sheet by allocating significant capital to introduce its award-winning platform to a generation of investors wanting speed, functionality, and a means to generate investment gains. Therefore, Q4 surprises relating to that traction could be a boom to share prices too. By the way, BLBX is growing on merit, not hype.
Notably, the Blackboxstocks platform is proving to be the ultimate tool for traders and investors demanding real-time data and fast, accurate information. And don't compare it to a simple Level 2 platform or tools provided by online brokers. Instead, users of BLBX benefit from a powerful financial technology and social media hybrid platform that brings real-time proprietary analytics and news for stock and options traders. Even better, while only those factors can be a trader's best friend, Blackboxstocks is much more powerful.
Its biggest attraction is its innovative software that takes the guesswork out of trading by employing "predictive technology." More simply, it virtually sets up every trade consideration through enhanced AI that finds volatility and unusual market activity resulting in rapid price changes of a stock or option. That screening, by the way, happens in a measurement of milliseconds, providing a trading edge to Blackboxstocks users historically reserved for professional traders. Moreover, the BLBX platform levels the playing field against those utilizing high-frequency trading and dark pools by giving retail investors a simple "click to action" means of executing a trade. In short, it's a trader's survival tool.
Best of all, Blackboxstocks is more than powerful and easy to use; its learning curve is measured in hours instead of months.
Blackboxstocks Gives Traders A Running Start
That means investors can benefit sooner rather than later. Oh, and BLBX is fast, really fast. The embedded technology continuously scans the NASDAQ, New York Stock Exchange, CBOE, and all other options markets, analyzing over 10,000 stocks and up to 1,500,000 options contracts multiple times per second. In addition, the BLBX platform provides its users with a fully interactive social media platform integrated into a user-friendly dashboard enabling users to exchange information and ideas quickly and efficiently through a shared network. That's not all.
The platform is the ideal tool for retail investors who want to follow more seasoned investors' trades. There, the social aspect of the BLBX platform provides a way for some investors to simply follow more savvy ones through its live audio/video feature, allowing members to broadcast on their own channels to share trade ideas. Hence, the BLBX platform is ideal for trading communities, and best of all, gives the entire team the simultaneous benefit of knowledge, speed, and access to real-time information. More excellent, a simple click of the mouse can deliver the millisecond difference between winning and losing trades.
Need more validation? One of the biggest names in the industry is adding to the platform's power.
Deal With Industry Giant TradeStation
In 2020, BLBX integrated its powerful platform with innovative and market-leading tools at TradeStation (NYSE: QFTA). That deal did more than validate BLBX. It gave its users an inherent ability to trade stocks and options via TradeStation without ever leaving the Blackbox platform. Moreover, the deal made BLBX one of the only companies offering a financial technology and social media hybrid platform providing real-time proprietary analytics for stock and options traders of all levels.
In addition, the partnership immediately provides new and existing users with a Quick-Click feature that loads proprietary automated alerts for options contracts through a simple two-click process. Also, BLBX saves traders crucial time on order entry and execution because of its lightning-fast execution speed. Not only that. Users get a dual benefit from real-time Blackbox trading alerts and from TradeStation's discounted trading rate with no ticket fee to Blackbox members using this feature.
Perhaps the best part of the platform proposition is that while it sounds complicated, it's not. Users simply click on any of Blackboxstocks's proprietary options alerts or options flow data, click the highlighted trade button, and watch the trade get executed. Thus, while the working relationship with TradeStation is transformative to BLBX, it can also lead to a trading windfall for users. Oh, investors in BLBX stock can win as well.
So, while short-sellers had their way for a week in November, the remaining part of 2021 and all of 2022 is set up well for BLBX longs to take charge.
Fundamentals Power Growth in 2022
Still, while it's often easy for retail investors to get shaken, they must remember not to get placed into another trader's plan. Indeed, BLBX stock was shorted. And after looking at the capital structure, which has a low O/S count and an even lower public float, BLBX stock was susceptible to professional traders that exploited a short-term opportunity. However, looking forward, starting today even, that window is closing. Fundamentals will take over.
Keep in mind, while its capital structure is impressive, its operating performance is as well. Combined, it's a powerful arsenal for near and long-term growth. And, after posting another strong quarter last week with 90% YoY revenue increases, investing against the grain on BLBX's progress may be short-sighted. Not only that, it could leave investors reeling from complacency-remorse for not taking advantage of a stock beaten down by emotion rather than substance.
Thus, while the short-covering rally is adding fuel to a rally in progress, consider BLBX for its intrinsic value, not as only a stock. After all, as noted, stock prices are usually an irrational representation of a company's value, an argument you can hear from both sides of the trade. But, in BLBX's case, the longs have more substance on their side.
Moreover, while the value proposition in BLBX stock was attractive at $5.00, it's compelling at $3.47. And whether it takes another day, week, or month for fundamentals to rule the trading day again, considering a trade with limited downside and potentially exponential upside may be a wise consideration. And it's one that Blackboxstocks presents.
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