I've gotten my fair share of emails asking me what's wrong with Draganfly (DPRO) . Yes, the stock action is terrible. If it were in a vacuum, I would be panicked, to say the least. It's not. That's not to say DPRO hasn't underperformed. It has. Any time your company loses 75% of its value over the past half year, that is an easy conclusion. In the last month alone, shares are down 37%. We haven't seen a close above $4 but one time since the late July uplist.
Unfortunately, the uplist to the Nasdaq came with a big offering at $4 when the stock had been trading above $5 prior to the move. The market hasn't forgiven the stock for that move. I imagine some of the institutional money that fund that offering at $4, used every push into $4 to get money back out. Additionally, there was a Regulation A offering back in late 2020 through early 2021 that recently came unlocked. Those shares were sold at $0.47 before the reverse split. That translates to $2.35, so we may have had people selling between $2.15 and $2.50 with the approach they still held warrants from that offering, As long as they were close to breakeven on the stock, they had a "free" or cheap look at the warrants. I really can't fault that approach, especially in this environment.
As for the company itself, they do continue to execute. News has been a little slow as of late, but it is the holidays. With several government related entities as clients, Draganfly may be held hostage to the dreaded budget proposals and approvals. That being said, they have introduced several new lines of business this year. Just this morning, they expanded their relationship with the Drone Racing League and Woz Ed to expand the DRL Academy STEM program. Many investors have been waiting to see what happens with the Woz Ed relationship, so here's a step. Plus, this shows that the Drone Racing League relationship is also growing. This is one expansion.
The Digital Dreams Labs $9 million deal was a huge step into the recreational AI toy segment of the market. We've seen steady progress in cold storage/drone delivery in Texas. Alabama continues to expand their use of Vital Intelligence. Nascar inches deeper and deeper into its relationship with Draganfly, but the company has expanded to Trophy Truck racing as well.
When you ask me what's wrong with Draganfly, I begin to wonder what's wrong with investors. Outside of a discounted offering that the market didn't like, the company continues to expand and deliver. It's almost illogical that the cash on the balance sheet has skyrocketed, revenue continues to grow rapidly, and the company has diversified its revenue streams significantly yet we're trading back to 2020 levels. This market has lost the ability to be patient with anything small. There's no other way to describe it. Once a small name loses momentum, it is dead in the water.
As long as DPRO continues to show strong quarterly growth, the company will be fine. Eventually buyers will find their way back. When you consider the value of the company is roughly 33% cash right now, I don't see how this doesn't setup for a massive rally after its next quarterly report if it produces the numbers I believe it will produce. Only time will time. Until then, this is going to test the pain threshold of every buyer in the last 12 months.