Yesterday we gave out an alert on Black Box Corporation (BBOX) in our write up "Black Box Skyrockets After Agreement With The Most Well-Known Social Media Company In The World" with a promise to provide an update. We think that the stock can hit $3-$5 in the near term and our confidence on our target is raised based on the hype over the weekend on social media and message boards about potential of this deal being with Facebook. We are up to 617 followers despite not giving out a lot of alerts, a fact that we think is indicative of a diligent and prudent stock picking history. If you like our picks you can follow our blog by clicking the follow button on the top of the left hand panel. You can also follow us on Twitter @StockTradePicks. We have around 3,000 followers on Twitter as well. If you would like to share this blog, make sure to use the URL "nasdaqnewsreports.blogspot.mx" as certain spam filters on social media don't let you post blogspot.com addresses.
BBOX was up on Friday after some very obvious good news when it announced that it was Awarded $10M+ Data Center Project for Global Social Media Giant. While the initial contract award is for $10 million, it could total more than $300 million in potential work for BBOX over a 5 to 10 year period. The tone of news release stating "the most well-known social media company in the world" has us assuming that this deal is with Facebook (FB), and it looks like this very obvious reading between the lines caught the attention of many other investors, traders and financial journalists who did some great research to provide more evidence supporting the veracity of this claim.
The Pittsburgh Post-Gazette reported the following:
"Washington County-based Black Box Corp. said it has been awarded a $10 million contract from a social media organization for digital infrastructure work, including more than 100 miles of fiber optic cabling within an Ohio data center that is almost a million square feet in size."
The details of a nearly million square feet data center in Ohio were not outlined in BBOX's press release, so the journalist did some digging into the details. This project sounds awfully similar to Facebook's data center project in New Albany, Ohio:
"Facebook is said to be investing $750 million in a 900,000 square foot data center in New Albany, an Ohio town that also hosts a cloud computing data center for Amazon Web Services."
In an interview with the reporter, BBOX CEO Joel Trammell said the following about the deal: "The contract award followed several years of data center work for the same company in Sweden".
Facebook has a history of building data centers in Luleå, Sweden with one completed in 2013 and a second in 2014. Facebook announced plans for a third one in the region that is scheduled to go live by 2021. This is very important to note for a couple of reasons. The most obvious one being that if BBOX worked on Facebook's Swedish data centers before and managed to procure another contract in the U.S., logic would dictate that BBOX is going into get business for this upcoming Swedish project too. The press release on Friday makes reference to U.S. work only, so any potential Swedish-based contract would be in addition to that.
For the second reason to become apparent, we have posted two screen captures of BBOX's income statement for 2012-14 and 2015-17 below. 2012 to 2014 was BBOX's "glory years" while working on Facebook's data centers. Excluding any goodwill impairment charge, operating income averaged well over $50 million annually over those three years. After the Facebook contracts ran dry, BBOX struggled to maintain profitability in 2015 to 2017, leading to the stock price tank and liquidity issues. But if this contract with Facebook can help return the company to its "glory days", we are talking about $50 million in annual operating income for a company that closed Friday at a $30 million market cap.
There is no way to know for sure that BBOX's success in 2012-2014 was all due to Facebook contract work in Sweden nor that its recent struggles were due solely to that contract running out, but we like our chances. BBOX is not without its risks as it has liquidity issues and couldn't file its annual report on time. That being said, the stock was already punished for that as it dropped to a low of $0.75 earlier last week before recovering back to $2.03 on this news of the new contract. This new deal basically offsets the bad news of the liquidity issues and we think it should continue to cause the stock to rise. BBOX is in a much superior position to renegotiate a deal with its lenders if it can show that this large new contract can bring the company back to consistent profitability. The same Post-Gazette article stated that "Black Box plans to release financial results on Wednesday, when company officials will discuss the impact of the contract on the company’s fiscal health". So it looks like we won't have long to wait to get a sense of the financial impact. Though the Facebook name drop has the chance to push the stock beyond our $3 to $5 target before Wednesday anyways.
BBOX was $8 a year ago and was well over $20 a few years ago when things were looking brighter. We think this new agreement will help the company return to its glory days though the threat of the liquidity issue certainly brings on added volatility. But added volatility is great for short term traders who smell an undervalued opportunity. Buy low, sell high. Or in the case of short sellers who got in too soon on BBOX, misunderstand the news, sell low and whine on Twitter and StockTwits about it. They should provide a nice added squeeze.
Disclosure: We are long BBOX
Bitcoin has gone from a concept worth pennies a few years ago to worth thousands of dollars. It may appear to some who are late to the game that the opportunity to get rich is gone. However, there are still plenty of ways to make some money trading in bitcoin and other cryptocurrency. Here are some links to valuable reports and strategies:
The Cryptocurrency Codex from the Cryptocurrency Institute
Secrets To Unlimited Free Bitcoin
The Crypto-Currency Evolution eBook
Bitcoin Complete Guide for Dummies
The Bitcoin Miracle Guide
The Bitcoin Cheat Code Book
The Crpytocurrency Course
Bitcoin Investing Live
If you're interested in making money investing or trading the stock market, here are some good resources to assist you. This includes technical analysis, investing in the weed sector, dividend stock investing, gold and commodities, sector rotation, options trading and microcap trading strategies.
Microcap Millionaires Free Video: Cheap Gold Miner Set to Soar in Fall 2017
The dividend stock report from dividendstocksonline.com
BBOX was up on Friday after some very obvious good news when it announced that it was Awarded $10M+ Data Center Project for Global Social Media Giant. While the initial contract award is for $10 million, it could total more than $300 million in potential work for BBOX over a 5 to 10 year period. The tone of news release stating "the most well-known social media company in the world" has us assuming that this deal is with Facebook (FB), and it looks like this very obvious reading between the lines caught the attention of many other investors, traders and financial journalists who did some great research to provide more evidence supporting the veracity of this claim.
"Washington County-based Black Box Corp. said it has been awarded a $10 million contract from a social media organization for digital infrastructure work, including more than 100 miles of fiber optic cabling within an Ohio data center that is almost a million square feet in size."
The details of a nearly million square feet data center in Ohio were not outlined in BBOX's press release, so the journalist did some digging into the details. This project sounds awfully similar to Facebook's data center project in New Albany, Ohio:
"Facebook is said to be investing $750 million in a 900,000 square foot data center in New Albany, an Ohio town that also hosts a cloud computing data center for Amazon Web Services."
In an interview with the reporter, BBOX CEO Joel Trammell said the following about the deal: "The contract award followed several years of data center work for the same company in Sweden".
Facebook has a history of building data centers in Luleå, Sweden with one completed in 2013 and a second in 2014. Facebook announced plans for a third one in the region that is scheduled to go live by 2021. This is very important to note for a couple of reasons. The most obvious one being that if BBOX worked on Facebook's Swedish data centers before and managed to procure another contract in the U.S., logic would dictate that BBOX is going into get business for this upcoming Swedish project too. The press release on Friday makes reference to U.S. work only, so any potential Swedish-based contract would be in addition to that.
For the second reason to become apparent, we have posted two screen captures of BBOX's income statement for 2012-14 and 2015-17 below. 2012 to 2014 was BBOX's "glory years" while working on Facebook's data centers. Excluding any goodwill impairment charge, operating income averaged well over $50 million annually over those three years. After the Facebook contracts ran dry, BBOX struggled to maintain profitability in 2015 to 2017, leading to the stock price tank and liquidity issues. But if this contract with Facebook can help return the company to its "glory days", we are talking about $50 million in annual operating income for a company that closed Friday at a $30 million market cap.
There is no way to know for sure that BBOX's success in 2012-2014 was all due to Facebook contract work in Sweden nor that its recent struggles were due solely to that contract running out, but we like our chances. BBOX is not without its risks as it has liquidity issues and couldn't file its annual report on time. That being said, the stock was already punished for that as it dropped to a low of $0.75 earlier last week before recovering back to $2.03 on this news of the new contract. This new deal basically offsets the bad news of the liquidity issues and we think it should continue to cause the stock to rise. BBOX is in a much superior position to renegotiate a deal with its lenders if it can show that this large new contract can bring the company back to consistent profitability. The same Post-Gazette article stated that "Black Box plans to release financial results on Wednesday, when company officials will discuss the impact of the contract on the company’s fiscal health". So it looks like we won't have long to wait to get a sense of the financial impact. Though the Facebook name drop has the chance to push the stock beyond our $3 to $5 target before Wednesday anyways.
BBOX was $8 a year ago and was well over $20 a few years ago when things were looking brighter. We think this new agreement will help the company return to its glory days though the threat of the liquidity issue certainly brings on added volatility. But added volatility is great for short term traders who smell an undervalued opportunity. Buy low, sell high. Or in the case of short sellers who got in too soon on BBOX, misunderstand the news, sell low and whine on Twitter and StockTwits about it. They should provide a nice added squeeze.
Disclosure: We are long BBOX
Bitcoin has gone from a concept worth pennies a few years ago to worth thousands of dollars. It may appear to some who are late to the game that the opportunity to get rich is gone. However, there are still plenty of ways to make some money trading in bitcoin and other cryptocurrency. Here are some links to valuable reports and strategies:
The Cryptocurrency Codex from the Cryptocurrency Institute
Secrets To Unlimited Free Bitcoin
The Crypto-Currency Evolution eBook
Bitcoin Complete Guide for Dummies
The Bitcoin Miracle Guide
The Bitcoin Cheat Code Book
The Crpytocurrency Course
Bitcoin Investing Live
If you're interested in making money investing or trading the stock market, here are some good resources to assist you. This includes technical analysis, investing in the weed sector, dividend stock investing, gold and commodities, sector rotation, options trading and microcap trading strategies.
Microcap Millionaires Free Video: Cheap Gold Miner Set to Soar in Fall 2017
The dividend stock report from dividendstocksonline.com
The dividend stock report from Dividend Stocks Rock
Top rated signals for binary options from binaryoptionsprosignals.com
Goldmasterinvesting.com Ocean Of Gold Report for the top 15 gold mining companies
Trader Review shows how to time the market with its "Percent of X" indicator
The Trader's Academy Club
The Wealth Builder's Club from beatthemarketanalyzer.com
MyBB: A Forum For Investors and Traders
Spartan Trader Forex Academy Live Daily Trading Room
Try the Z Code System if you're looking for other ways to make money systematically outside of the stock market.
Top rated signals for binary options from binaryoptionsprosignals.com
Goldmasterinvesting.com Ocean Of Gold Report for the top 15 gold mining companies
Trader Review shows how to time the market with its "Percent of X" indicator
The Trader's Academy Club
The Wealth Builder's Club from beatthemarketanalyzer.com
MyBB: A Forum For Investors and Traders
Spartan Trader Forex Academy Live Daily Trading Room
Try the Z Code System if you're looking for other ways to make money systematically outside of the stock market.
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