LAS VEGAS - Ault Alliance, Inc. (NYSE American: AULT), a diversified holding company, has reported significant growth in sales demand and backlog for its subsidiary Gresham Worldwide, Inc. (OTCQB: GIGA), with a particular surge in its defense business segments. The company's Israeli subsidiary, Enertec Systems 2001 Ltd., which operates in the missile defense and medical device markets, is leading this increase.
Gresham's current backlog, combined with existing contract options, is estimated at $46 million as of March 31, 2024. The company projects that its annual revenue will surpass $50 million for the year 2024. This anticipated growth is attributed to the escalating global conflicts that have heightened demand for defense technology solutions.
Enertec, a key contributor to this growth, has a 44-year history and is considered by Gresham to be one of Israel's top private defense test equipment suppliers. The firm recently secured a multi-year contract worth $20 million to provide missile defense system technology. Gresham's operations also span across the United Kingdom and the United States.
William B. Horne, CEO of Ault Alliance, praised Gresham's innovation and performance, expressing commitment to support its advancements in defense technology during these critical times. Jonathan 'JR' Read, CEO of Gresham, expressed confidence in the company's growth trajectory, expecting an average annual revenue growth rate exceeding 20% in the coming years, alongside plans to enhance profitability through operational synergies.
Ault Alliance's portfolio includes a variety of industries such as data center operations, artificial intelligence ecosystems hosting, defense/aerospace, and more. The company also provides financial support to select businesses through a licensed lending subsidiary.
The information in this article is based on a press release statement from Ault Alliance, Inc. Investors are advised to consult the company's public filings and press releases for more detailed information.
InvestingPro Insights
Ault Alliance, Inc. (NYSE American: AULT) has shown a noteworthy 75.93% revenue growth over the last twelve months as of Q1 2023, indicating a robust upward trajectory in its financial performance. This aligns with the company's reported surge in sales demand and backlog for its subsidiary Gresham Worldwide, Inc., particularly in its defense business segments. The revenue growth is further complemented by a positive outlook, with the company's annual revenue projected to surpass $50 million for the year 2024.
Despite the optimism surrounding the company's sales and backlog, Ault Alliance faces challenges as reflected in the InvestingPro Data. With a market capitalization of just $0.77 million and a Price / Book multiple as low as 0.01, the company's valuation metrics suggest that it is trading at a low price relative to its book value, which could be an indicator of market undervaluation or underlying financial difficulties. This could be of particular interest to value investors or those looking for potential turnaround situations.
InvestingPro Tips for Ault Alliance highlight several areas of concern. The company operates with a significant debt burden and may have trouble making interest payments on its debt, which is a critical factor for investors to consider, especially given the company's high revenue growth. Additionally, analysts do not anticipate the company will be profitable this year, and the stock has experienced high price volatility, with a 1-month price total return of -12.81% and a 1-year price total return of -99.93%. These factors underscore the importance of due diligence and risk assessment when evaluating Ault Alliance as an investment.
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