Looking Ready for a Swing as this Company Presses Hard on Sales Initiatives
Cash on hand will fund the company through 2023.
Hello everyone, if your just joining us and missed our initial coverage of SOBR, take the time to read this full report.
SOBR Safe, Inc. (NASDAQ: SOBR) has developed a proprietary, touch-based identity verification, alcohol detection and cloud-based reporting system that may render breathalyzer technology obsolete.
Current price $2.02/share (as of market close 11-9-22)
We talked about SOBR a month ago, but I want to revisit the company because their story is just getting better. SOBR listed on the NASDAQ in May this year, their story is amazing with disruptive technology, and they are pressing hard for market penetration. I expect revenues at SOBR could explode in the near term.
Briefly, SOBR has invented an alcohol detection technology that is touch based, extracting humidity from the skin and determining the presence of alcohol. Breathalyzers can report alcohol with 80% accuracy. SOBR’s technology operates with 97% accuracy. We will talk more about SOBR products below.
Last month the NTSB made a statement alluding to the need for technology like SOBR’s to be installed in all new cars, preventing them from starting for an alcohol positive driver. NTSB Chair Jennifer Homendy implored, “We need to implement the technologies we have right here, right now to save lives.” That news sent SOBR shares soaring because they’re the first to market with finger touch technology.
In the U.S. there is an alcohol related automobile fatality every 45 minutes and 290,000 are injured in such accidents every year (NHTSA). Drivers with a blood alcohol content of over 0.10 are seven times more likely to be involved in a fatal accident than sober drivers.
Here is how SOBR has traded since then:
September 20th (day of the NTSB statement) $.91 to $3.16/share
October 10th (day of our last alert) $2.80 to $3.74/share
October 26th (SOBR advises cash position) $3.64 to $4.27/share
November 8th (as I draft this report) $2.11 to $2.22/share
SOBR shares have been bouncing around for a few reasons. The peaks are likely due to SOBR having an amazing, disruptive technology with enormous potential that has investors excited and a consistent flow of catalysts. The valleys are the result of weakness in the equities market and a significant uptick in short interest.
As you read this report, you may be like me thinking of dozens of potential applications for SOBR devices and their technologies.
Recent catalysts at SOBR:
Recently the company confirmed it had over $10M in cash, enough to fund the company through 2023. They further stated the common shares in the public float were approximately seven million. The company will strengthen its sales and distribution network with some of those funds.
Just this past Tuesday SOBR announced that the Child Safety Network (CSN) has awarded the Company its Safe Family Seal of Approval, and SOBRsafe will be prominent in the national nonprofit’s technology stack for ensuring school bus safety. America has 500,000 school buses to protect but think of the ripple effect this endorsement could have on the company’s marketing efforts.
Last week SOBR announced it’s entering the oil and gas industry through multi-site SOBRcheck™ demonstrations, as sponsored by TerraTech, one of the world’s largest oilfield services and logistics providers. Oil and gas experiences the highest rate of binge drinking of any industry in the United States.
On October 19th, SOBR announced that a prominent west coast commercial construction company (they didn’t name the company) is implementing SOBRcheck™ as the new front line alcohol screening solution for its more than 400 employees across multiple locations. Over 20% of construction risks are alcohol related and the total annual cost of all U.S. construction injuries is $12 billion.
SOBRsafe Chairman & CEO Dave Gandini will present at 1:00pm ET and is conducting one-on-one investor meetings at the Sidoti & Company Virtual Investment Conference on November 10, 2022. Sidoti has been a premier provider of independent securities research focused specifically on Small Cap and Micro-Cap companies and the institutions that invest in their securities.
The developments I mention above are just those that have happened since our last report one month ago. Now I want to look at how SOBR makes money and their alcohol detection devices.
It’s important to understand that SOBR is firstly an SaaS company and that is where they will generate most of their revenues. They sell their devices at reasonable prices, they aren’t expensive, then they attach a per user/employee monthly fee for use of their cloud-based software that records the data the devices collect. The contracts SOBR clients sign for SaaS services are on an Evergreen 60-month basis.
SOBR outsources their device design, engineering, manufacturing, and testing functions to BGM Engineering. Another partner, HELM provides packaging, fulfillment, onboarding, and customer service functions. The arrangement with these partners allows the staff at SOBR to focus on sales, their SaaS platform, and collecting fees.
SOBRcheck – is a touch-based desktop device with online reporting. There are no upfront installation fees (device is free) and cloud monitoring is only $30/month per employee/person. The expandable device can store data for 1,000 users and can process up to 200 users/hour.
SOBRsure – is a wearable device with continuous alcohol monitoring and GPS tracking. Provides notifications to managers/parents upon alcohol detection or device removal. The unit cost is $299, and the software fee is $19.95/month per user.
Potential applications for SOBR device applications:
Law enforcement for impaired drivers – the judicial system for probation and work release – any public transport including planes, trains, buses – construction and machine operators – hospitals – rehabilitation centers – commercial drivers – child driver monitoring, installation in new cars, and many more. As I said above, potential applications are only limited by imagination.
Can you imagine what kind of insurance discounts might become available to users of SOBR devices?
FYE is December 31, mrq is 6-30-2022
Insider ownership 28%
Outstanding shares 12.9M
Shares float 7M
Insider ownership 28.5%
Market cap $28.6M
Cash $10M+ (as of 10-25-22)
With a soft RSI (14) of 42.6 and an obvious trough having developed SOBR looks like it may be ready to swing into a peak.
Stay tuned for our full report on SOBR.
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