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Bravada International Ltd. (OTCMKTS:BRAV) Has A Clear Runway For Growth

Bravada International Ltd. (OTCMKTS:BRAV) Has A Clear Runway For Growth
Written by
Jarrod Wesson
Published on
May 24, 2017
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Bravada International Ltd. (OTCMKTS:BRAV), the women’s fashion retailer specializing in leggings, and leg fashion, launched very recently a new retail online business, which was celebrated by the market. The share price spiked on high volume reacting to the news. Have a look:SourceThe new store is www.LeggingSuperstore.com, which is likely to increase the revenues of the BRAV. Because of this, the market pushed up the share price in a sudden way. The company seems to be in a process of changing its business model from being a physical store to operating the business online. We believe that it is a great step and the market seems to believe the same, given the most recent share price spike. In this article, we will provide you more information about the other websites and physical stores of BRAV.BusinessThe business entity commenced its operations on September 19, 1997. It has changed its name several times until March 16, 2010, when BRAV started its activities. The company's business objective is the marketing, sale, and distribution of "women’s apparel, women’s leg fashion, leggings, and bodysuits primarily in Canada, the United States, and Australia". A physical store and the following websites are owned by BRAV:www.LeggingSuperstore.comwww.WorldofLeggings.comwww.OnlyLeggings.comwww.MuscleFlex.comwww.Legstravaganza.comAccording to the most recent quarterly report, the first two websites in the list earned the highest customer ratings for their product quality and customer service levels that Google and Amazon give, 4.8. Additionally, the company has registered the following trademarks: "World of Leggings," "Muscle Flex," and "Legstravaganza".Recent DevelopmentsAccording to the press release put out on May 18, 2017, the new store is offering "3,000 legging and leg fashion styles" including regular and plus-size leggings. The catalog of the shop includes clothes made with USA basic cotton "stunning graphic print styles such as mermaid-scale leggings and armor-leggings, graphic print bodysuits, jumpsuits, and seasonal leggings".SourceThe market reaction to this release was as follows. On May 17, 2017, the shares were exchanged at the price of $0.0006 before the announcement of the news. On May 18, 2017, right after the announcement, the share price went to $0.0017, and later, the following day, the share price touched the level of $0.0023. On May 20, 2017 and the following days, the share price declined a little bit to $0.0014 as market participants booked profits.Financial figures and share typesThe following financial figures were reported in the last quarterly report:

  • Inventory: $537,000
  • Total assets: $841,000
  • Long Term Debt: zero
  • Total Liabilities: $749,000

In addition, according to OTC Markets, the total amount of outstanding shares is approximately 704 million. Thus, the fair value using the net asset value per share is about $0.0013. However, online retailers are valued much more, as we need to count the future growth of the online retail business. So, if the comparison with other big online retailers is fair, the share price would be worth much more.We noted in the most recent quarterly report that the company has different classes of stock. The following are the securities offered:

  • Common stock
  • Series A Preferred Stock: its number of votes is equal to 1000 to 1.
  • Series B Preferred Stock: it has five hundred voting rights, can be convertible and is redeemable.
  • Series C Preferred Stock: it has number of votes equal to two thousand voting right, can be convertible and is redeemable.
  • Series D Preferred Stock: it has two thousand (2000) voting rights, can be convertible and is redeemable.
  • For more questions, shareholders can check the quarterly report or contact the transfer agent, Madison Stock Transfer Inc.

Is there dilution risk? Yes, the preferred shares may be convertible to common stock. However, if the company can grow its business, it will offset the dilution.ConclusionBravada International seems to have been growing its online retail business for quite long time. But, it seems that it was just recently that the market started to recognize its potential. The latest breakout was produced as a result of the launch of LeggingSuperstore.com. In this article, we saw that the company has many other assets and has been operating other websites before. Additionally, the share price is worth exactly the same as current book value per share. Hence, the market is not pricing in the fact that the online retail business is growing at a high pace, so the share price may be undervalued. To sum up, there is a lot to like in the company and investors need to be alert. We will be updating our subscribers as soon as we know more. For the latest updates on BRAV, sign up below!Disclosure: We have no position in BRAV and have not been compensated for this article.

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