Forward Industries Inc (NASDAQ:FORD)
Forward Industries is having an incredibly strong day in the market today, and for good reason. The company announced that it has reached an extended agreement with regard to one of its biggest customers. Today, we’ll talk about the agreement, how the stock is reacting to the news, and what we can expect to see from FORD moving forward. So, let’s get right to it…
FORD Announces Agreement Extension
As mentioned above, Forward Industries is having a strong day in the market today after announcing the extension of an important agreement. You see, the company is focused on designing and distributing custom carry and protective solutions. In most cases, the solutions are designed for important aspects of the medical industry.
For example, for several years now, FORD has been supplying a company known as Global Healthcare with quality custom carry cases for diabetic products. However, investors were getting concerned as the agreement between the two companies was scheduled to expire.
Nonetheless, today’s news was overwhelmingly positive as the company announced that the Global Healthcare agreement would be extended. The two companies reached an agreement to extend the existing supply agreement by another three and a half years. As a result, FORD will continue providing custom carry cases for diabetic products through January of the year 2020. In a statement, Terry Wise, CEO at Forward Industries had the following to offer…
“This agreement from another major player in the industry emphatically reflects Forward’s ability to consistently provide a high quality compliant product on a timely basis. I am extremely delighted that we continue to uphold our extremely high quality performance ratings from all our multi-national clients – and despite a very challenging, highly regulated and competitive market landscape we continue to be the preferred supplier of choice within the diabetics’ custom case industry.”
How The Market Reacted To The News
As investors, one of the first things that we learn is that the news moves the market. Any time positive news is released with regard to a publicly traded company, we can expect to see gains in the value of the stock associated with that company. Adversely, when negative news is released, we can expect to see declines. In the case of FORD, the news that was released was overwhelmingly positive. Now, investors can rest assured that the revenue generated from the Global Healthcare agreement will stay in tact for a minimum of three and a half more years! As a result, we saw gains in the value of the stock today. By the end of the trading session, Forward Industries grew by $0.45 per share or 39.47% to close the day off at $1.59 per share.
What We Can Expect To See Moving Forward
Moving forward, I have an incredibly bullish opinion of what we can expect to see from FORD. However, it’s also important to remember that the market tends to move through a series of overreactions. So, we can expect it to fall back from highs tomorrow. Nonetheless, the forward looking picture actually looks pretty good here. With the continued agreement, Forward Industries maintains its position as a leading provider of carry cases for diabetic supplies. This will help revenue to continue to grow, leading to further gains in the value of the stock.