In the wake of its recent shareholder’s letter, Crown ElectroKinetics Corp. (NASDAQ: CRKN) has been getting plenty of hype. The smart glass manufacturing company has completed its first prototype and is set to commercialize its product soon. Furthermore, CRKN recently secured two lucrative contracts while adding a third one to the list during its earnings call. But most importantly, CRKN is to report its Q1 earnings this week and provide its 2023 guidance in an upcoming shareholders letter. With this in mind, CRKN stock could be one to watch.
CRKN Stock News
After issuing its shareholder’s letter on April 26th, CRKN stock has been gaining a great deal of hype, climbing as much as 220%, mainly due to the company stating some significant forward-looking statements in its letter.
Intending to commercialize its product, CRKN has indicated that it has completed its first prototype smart window insert. The company believes this accomplishment, alongside other prototype accomplishments, would put it on track to commercialize its product, the Generation 1.0 Smart Window Inserts, at the end of the summer.
CRKN could also benefit from the Inflation Reduction Act that expands the tax incentives for retrofit energy improvements. This might drive demand for its product since CRKN is currently operating in a developing market with few competitors. As a result, CRKN could realize revenues soon by the end of the year.
Moreover, CRKN has gained two more customers increasing its total to three and is expecting approximately $100 million in revenues throughout the contracts. With CRKN having a market cap of around $8.14 million, the company could be massively undervalued in light of its expected revenues.
CRKN was set to report its Q1 earnings on May 15th and provide updated guidance on the revenue and EBITDA for 2022. However, CRKN released an NT 10-Q filing stating it would report its Q1 earnings within 5 days from the original date. CRKN also held an earnings call, where the company stated that it would provide another shareholders letter in the next two or three weeks discussing 2023 guidance.
During its earnings call, CRKN stated that it had secured a three-year contract adding a new third customer to its list. Despite not mentioning how much revenue this contract will generate, CRKN anticipates a purchase order from this contract within a week or so, where it will announce what it will mean to its revenues. With this in mind, investors may want to keep an eye on CRKN as it discloses more information regarding this contract during the coming week or so.
Furthermore, CRKN stated that it was granted an extension from NASDAQ until August 28th to regain compliance. Yet, if the company doesn’t meet the minimum bid price by then, it would perform a up to 1 to 15 reverse split as CRKN already has shareholders’ permission. As a result, CRKN might not face any dilution risks moving forward. Nevertheless, CRKN might not even have to perform a reverse split as it is set to put its product on the market by the end of the summer, which could boost its stock price by then.
CRKN Stock Financials
In its 2022 annual report, CRKN reported $6.5 million in assets, including $821 thousand in cash. CRKN witnessed a decline in assets from $9.6 million, including a decrease in its cash from $6.1 million. CRKN’s liabilities grew YoY from $664 thousand to $6 million as its current liabilities increased from $664 thousand to $4.6 million, while the company had a total of $1.3 million in lease liability during 2022.
CRKN is still to report revenues as it awaits product commercialization, however, its operating losses slightly shrank YoY from $16.8 million to $15.1 million, while its net loss also shrank YoY from $16.4 million to $14.3 million.
Media Sentiment
@greatstockpicks is excited about CRKN’s new purchase order
@rob_tradez is expecting a gap for CRKN soon
@TerryChenOK is anticipating CRKN price to more than double
Technical Analysis
CRKN stock trend is neutral as it is trading in a sideways channel between the support at $0.18 and the resistance at $0.24
Looking at the indicators, CRKN stock is trading above the 21 MA, 50 MA, and below the 200 MA, which is a bullish sign. The RSI is approaching overbought at 67, and the MACD is bullish.
Fundamentally, CRKN stock’s most recent catalysts were its shareholder’s letter and earnings call. At the same time, its upcoming catalysts are its Q1 earnings report, more information regarding revenues from its recently secured contract during the coming week, its upcoming shareholders’ letter, and its product hitting the market at the end of the summer.
CRKN stock price is expected to increase in anticipation of its 2023 guidance during the upcoming shareholders’ letter while also awaiting its product’s commercialization at the summer’s end. A possible play would be going long, and an entry point would be on retests of the $0.18 support and taking profits on retests of the $0.24 and $0.3 resistances while leaving a tail in anticipation of the company commercializing its product at the end of the summer.
CRKN Stock Forecast
Following its shareholder’s letter, CRKN stock has been gaining significant traction, with the company stating that it has completed its first prototype and is set to commercialize its product at the end of the summer, allowing it to realize revenues during the latter half of the year. Additionally, CRKN has completed two contracts, increasing its current customers to three industry-leading companies. With CRKN expecting $100 million in revenues from these contracts while expecting to disclose more information about its third contract in a week or so, CRKN stock could be heavily undervalued due to its significantly low market cap. As CRKN is set to offer its 2023 guidance during an upcoming shareholders’ letter in two or three weeks, CRKN stock could be one to keep an eye on.
If you have questions about CRKN stock and where it could be heading next, feel free to reach out to us in our free alerts room!
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