Cyberlux Corporation's (OTC: CYBL, $CYBL) shares have been consolidating at the $0.015 level. But, that doesn't mean they are fairly valued. In fact, at current prices, they are anything but. And that takes into consideration its more than 30% surge since the start of March. What's more, even technicals support CYBL's share price should be trending higher. Thus, why are the shares stuck in a tight range? Probably because markets are never perfect, and in this case, they are quite the opposite.
After all, CYBL is better positioned for significant growth today compared to any time in its history. They proved that after recently bumping guidance higher by 47%, telling investors to expect upwards of $44 million in revenues this year. How many penny stocks generate that much income per year? Not many. In fact, we couldn't find another $0.015 stock producing anything close to what CYBL forecasts. And plugging those forecasts into just about any valuation model indicates CYBL stock is appreciably undervalued. Not just based on current forecasts but also because guidance past 2022 is exceedingly more bullish, with management expecting its company to exceed the $100 million revenue mark as early as year-end 2023. They actually have even more bullish calculations based on their pipeline vision.
But, just taking the lower end of guidance to post $100 million in less than 24 months should still be sending this stock considerably higher. Remember, investors trade on forward-looking valuations, and being early to CYBL stock at these levels, especially with the apparent price/asset disconnect, offers an investment proposition worth the wait. A most bullish presentation at the recent Emerging Growth Conference even laid out the case, first hand, for why CYBL stock presents a compelling investment opportunity.
Therefore, while CYBL stock may be taking a breather after a more than 30% run, waiting too long to capitalize on this apparent valuation disconnect could leave substantial dollars on the table. Its next revenues update alone could send share prices exponentially higher.
A Pipeline Of Near-Term Catalysts
That's no exaggeration. Even a quick sum of its parts shows that CYBL has the revenue-generating firepower already in place to squeeze its stock price appreciably higher. Recent acquisitions, a strong cash position, and a slew of accretive 2021 deals do an excellent job of justifying why CYBL is better positioned today to score record-setting revenues compared to any time in its history. And as noted, CYBL is bullish, too, raising its 2022 guidance from $30.5 million to $44 million for the year. Obviously, management gets a better view of behind the scenes, and it's unlikely they would guide too aggressively without supporting evidence of an expected surge. Much of their optimism could stem from the performance of its acquisitions, especially in the Digital Platform Solutions sector of its business.
There, its acquisition of Kreatx SHPK is setting up to be a value driver that delivers faster growth than expected from a digital services space that is red-hot with client demand. Kreatx develops innovative software solutions for private and public sector clients. And the deal does more than help clients; it brings under CYBL management extensive knowledge and experience in building SaaS solutions and end-user applications. Of course, the better news is that it opens the doors to significant revenue-generating opportunities.
Already in the crosshairs is earning business from clients needing, not wanting, end-to-end digital platform solutions that make communicating across multiple organizational channels more efficient and possible. By the way, both government and commercial clients are in play, with each providing CYBL the chance to score multi-million dollar contracts from creating client-specific solutions. Notable, too, the addition of Kreatx adds to the foundation of its Cyberlux Infrastructure Software Solutions (Cyberlux ISS) business unit and accelerates one of Cyberlux's core growth initiatives of monetizing its new Cyberlux Digital Software Platform.
From both CYBL's and investors' perspectives, the best news is that clients need what CYBL is selling. That results from technology outpacing large companies and government offices' ability to keep pace with implementing supporting change. In other words, thousands of commercial clients and probably hundreds of global governments are way behind the curve when it comes to having integrated necessary upgrades to their communications infrastructure. Why is that a big deal and a massive opportunity for CYBL? Well, because even basic infrastructure is tied to communicating from department to department. And when systems get out of whack, even between an entity and its vendor, serious consequences could result. Imagine the ramifications of a government defense department, for instance, not communicating effectively between government branches. Or if a municipal water supply company couldn't process communications with outside departments. The results of not being able to do so could be potentially catastrophic.
Here's the part most investors may not understand when evaluating the CYBL investment proposition. While billions of people walk around with smartphones that house the latest technology grade, that's not the case for commercial and governments. What's taken for granted by 99% of the smart-device carrying population is that every company or agency down the line enjoys these same technologies. That's not the case, and not even by a long shot. Hundreds, perhaps hundreds of thousands of businesses need system upgrades to catch up with last year's technology. And even if they get that much accomplished, they will still be behind the curve ahead of the next technological advance.
Bad for them, but good for CYBL, since those same entities lacking what CYBL offers today will also need them in the future. Thus, far from a one-and-done provider, CYBL can keep recurring client revenues in its queue for potentially decades. That's a probable cause for management to suggest more than $100 million in revenues is likely closer than many expect.
Digital Platform Solutions meet Surging Demand
And know this, CYBL has the assets in its portfolio to generate those lofty revenues. Not only that, they already prove that its digital services platform does more than create a means to communicate effectively; it also accelerates clients' competitiveness by enabling new delivery channels and integrating separate business models. Most important to Cyberlux's value proposition is that they build client-specific solutions, which could create a client relationship intact for years beyond the initial sale.
Part of that specificity is that CYBL builds platforms that facilitate multiple areas of platform functionality. Its Marketplace solution is an excellent example of how that works by enabling clients to leverage customized services allowing them to catalog and manage third-party suppliers. Several parts combine to make the solution valuable. Its Services Automation solution orchestrates client-specific processes and workflows to drive efficiencies of scale. Its Low-code development solutions enhance client business and IT collaboration by leveraging visual development and reusable components to build and modify processes, workflows, and business apps. Of course, tying all of it together is an Integration solution that joins all disparate enterprise data enabling better decisions and experiences for employees and customers.
So, in just that business segment, how big is the revenue-generating opportunity for CYBL? In a word, substantial. Combining the sum of just its marketable solutions puts a more than $813 billion global revenue-generating opportunity in its near-term crosshairs. And knowing that CYBL's Digital Platform Solutions capabilities provide comprehensive and much-needed technological solutions to government and industry, capturing a significant part of that almost trillion-dollar market potential is certainly within near-term reach.
Cyberlux Is Already A Vendor In Government Systems
In fact, because CYBL already does business with principal government offices, including the DoD, a jump start to earning those revenues could happen faster than even the staunchest bulls expect. That's because there is absolutely no time to waste for clients to implement and integrate systems that allow for seamless digital processes. As far as its government contract work, the excellent news on that front is that CYBL is already an established vendor for large government departments, including the Department of Defense. That's a big deal, and it positions CYBL potentially ahead of others vying for contracts. Those contracts, by the way, are generally not small. Government contracts can quickly jump into the tens of millions of dollars with the scope involved. Thus, having a foot in the door, so to speak, provides a competitive advantage for CYBL that shouldn't be overlooked or underappreciated.
Keep in mind that while some of CYBL's competitors may be able to find niche opportunities, few, if any, offer a comprehensive suite of services comparable to CYBL. That, too, can't go underappreciated since, by design, CYBL provides a total solution instead of just adding a component to an existing one. That's a critical advantage by alleviating client concern and doubt of the system's ability to work seamlessly from module to module. In other words, whether clients need more efficient cloud computing, big data and analytics, cybersecurity, artificial intelligence, or a more robust Internet of Things (IoT) platform, CYBL solutions address the implementation and integration processes across the board. Expect the power of that segment to flex its revenue-generating muscle in the first part of this year.
Its DPS business segment is just one division expected to add significantly to the growing revenue streams. They have several others, and each is positioned to add an additional punch to its income.
Value Drivers Are Diverse And Potentially Lucrative
Better still, those divisions add multiple revenue-generating shots on goals across a broad range of industries. And again, CYBL could hold a competitive advantage in each market. In-play today are value drivers capitalizing on its interest from a stake in advanced unmanned aircraft systems (UAS), LED lighting solutions, renewable energy and infrastructure technology, and Software-as-a-Service (SaaS) solutions. In addition, as an active Department of Defense (DoD) contractor, CYBL is already providing leading-edge, battle-tested lighting solutions to the U.S. Air Force, National Guard, Special Operations Command (SOCOM), and the U.S. Army. Client interest in CYBL technology at that level is more than product validation; it shows just how good CYBL's technology is.
The market dollars at stake justify CYBL's interest as well. Its FlightEye UAS solutions and its Infrastructure Technology solutions focus combine to allow CYBL to target a more than $171 billion global revenue-generating opportunity. Another $3.7 billion is in play from its Advanced Lighting Solutions business market opportunities. And those dollar market references are at today's estimates. Each is expected to grow by low to mid-double-digit percentages, which, when compounded, can double the market size in less than five years.
Therefore, referencing earlier that CYBL's $44 million 2022 guidance may prove conservative could be a spot-on assumption. And at less than $0.02, and with record-setting growth happening today, CYBL stock is simply too good to ignore.
Exponential Growth Expected
Moreover, consideration now is timely since it's likely that the disconnect between CYBL's current share price and its intrinsic value may not last much longer. And that's not an expected result of investor sentiment but rather from operational performance.
Remember, most stocks trading at CYBL's price are either non-revenue-generating companies or new to the industry. CYBL is neither. They generate significant revenues now and will do better as the year goes on. And they certainly aren't new to the industry.
CYBL has provided leading-edge, battle-tested lighting solutions to the U.S. Air Force, National Guard, Special Operations Command (SOCOM), and the U.S. Army for more than a decade. Currently, CYBL is part of the supply chain fortifying the DoD with lightweight, portable battery-powered advanced LED lighting systems for special operators, forward-base operations, security, and maintenance lighting. Things in that division look extremely promising heading into the last three quarters of this year.
In fact, CYBL announced completing initial consumer product trials, making them better positioned than ever to provide the DoD with specialized lighting technology and serving the military, first responder, and specific commercial markets with its innovative BrightEye Tactical Lighting System products. Results were so encouraging in its product trials that CYBL believes it can become a go-to provider of advanced lighting solutions worldwide to government and military organizations. Listening to the CEO at the Emerging Growth Conference, they intend to make that happen.
By the way, there's still more to like. And again, revenue-generating firepower is included.
Accretive Acquisitions Generate Additional Rev-Gen Firepower
CYBL expects to see a significant revenue contribution from its acquisition of FBD Group SHPK, a company it purchased to build its infrastructure technology capability platform, including critical technology assets and personnel resources. That deal can be a near-term driver, too, expected to accelerate revenue-generating opportunities across Europe and North and South America through a new business unit, Cyberlux Infrastructure Technology Solutions (Cyberlux ITS).
Like its others, this division targets a massive sector with its platform driving the execution and implementation of core CYBL infrastructure technology across global renewable energy and infrastructure projects. FBD Group adds expertise as a worldwide telecommunication, infrastructure, software, and service provider. They add additional value as an innovator in next-generation telecommunications technologies such as 5G, a key communication technology enhancing CYBL's business interests and capability in the unmanned aircraft guidance systems sector. Indeed, CYBL's sum of its parts is impressive, and what's more appealing is that they have a plan to maximize the totality of value.
The company recently announced its Operation Alpha growth plan, putting three priorities are in play: (1) drive growth through aggressive business development, acquisitions, and joint ventures; (2) address core target markets with DoD products, new specialty UAS technology capabilities, solar and renewables, and with emerging infrastructure projects; and (3) gain immediate business velocity by focusing on the new business and the new product pipeline, accelerating the South American projects, continuing to build out the Company's organization, and driving the Company's strategic IP development.
The theme is simple. Make its acquisitions, business divisions, and future performance accretive to its collective operational vision. In other words, combine several multi-billion dollar market opportunities to target a potential combined trillion-dollar market developing within the next few years. Kind of like one team, one dream philosophy. However, CYBL's markets are no dream. They are already beyond a known $930 billion combined revenue-generating opportunity. Capturing 1% of that potential- $9.3 billion. Capturing 1/10th of 1%- $930 million. No matter how it's broken down, CYBL is breaking down a massive wall of revenue-generating opportunities that fit its diversified business profile.
Undervalued Today But Maybe Not Tomorrow
So, while shares are undervalued today, that doesn't mean the same will be true tomorrow. CYBL is bound to catch the bid deserved. And with its 2022 prospects looking ready to deliver, being early to the CYBL investment consideration may be worthy of a buy, set, and forget it strategy. Periodic profit-taking aside, investors have an opportunity to post exponential gains from a less than $0.02 stock on the verge of delivering $44 million in revenues this year. Indeed, if guidance turns into reality, current valuations would likely become extinct minutes after the release.
Thus, taking action in the CYBL proposition sooner than later may be a wise consideration. Remember, markets may miss the mark when pricing stocks, especially in the penny sector. But, fundamentals, contracts, revenues, and fiscal discipline can change attitudes about a company stock price in a hurry. In CYBL's case, an attitude adjustment starting today would be timely, and moreover, it's warranted.
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