ENGlobal Corp. (ENG) stock prices were down by a concerning 18.0528% shortly after market trading commenced, bringing the price per share down to USD$2.9501 early on in the trading day.
Securities Purchase Agreement
The company announced on June 2nd, 2021 that it had entered into a securities purchase agreement with various institutional investors. The agreement will entail the sale and purchase of 7,142,859 shares of the company’s common stock, with a purchase price of USD$2.80 per share. The shares will be distributed via a registered direct offering priced at-the-market (ATM) under Nasdaq rules. June 4th, 2021 is the anticipated closing date of the offering, subject to the satisfaction of customary closing conditions.
Net Income and Revenue
The company announced earlier in May 2021 that net income for the first quarter of the 2021 period ended March 27th, 2021 came out to USD$46,000, with revenues being reported at USD$12.499 million. These numbers are comparable to the USD$1.101 million reported in net income for the same quarter of the prior year, as well as the USD$19.26 million in revenue generated for the same quarter period ended March 28th, 2020.
Affected by Pandemic
With the onset of the global pandemic having spared precious few businesses from the scope of its devastating economic wrath, ENG was also severely affected. At present, the company reported seeing strong indications of their top and bottom-line performance improving over the course of the fiscal year 2021.
End of Pandemic Woes in Sight
Primarily because of ENG’s heavy investing in business development that it expects to come to fruition over time, but also because of the global immunization efforts. With the world hurtling towards universal immunizations, the company forecasts more people returning to work as the spread of the pandemic is curbed. This, in turn, will facilitate increased demand for ENG’s clients’ products.
The company has also reported signs of market opportunities in green energy sectors continuing to improve, including renewable fuels and solar energy. ENG has made additional progress in expanding their roster of established technology and construction partners, which, in turn, makes the company a more attractive option for prospective clients. The company anticipates attracting numerous high-value contracts over the course of the upcoming quarters.
Future Outlook for ENG
With the end of the pandemic seeming closer and closer, ENG is poised to capitalize on the opportunities presented to it in a post-pandemic economy. The company is keen to push for further growth and continue its trajectory of success. Current and potential investors look to management to leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.