re: OWLT Baby products.

Owlet Announces $9 Million Private Placement Financing

ATLTiger still riding this through? I’ve been able to average down, and did really well on those lots.. but this bag is heavy!

I break even at $9-10. At $50M or so market cap, I’m still in the camp it goes to zero or a multi-bagger within the next 12-18mos.

https://investors.owletcare.com/news/news-details/2024/Owlet-Announces-Strong-Second-Quarter-2024-Results-Achieves-Record-Breaking-Amazon-Prime-Day/default.aspx

quote:

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Owlet Announces Strong Second Quarter 2024 Results, Achieves Record-Breaking Amazon Prime Day
08/12/2024
LEHI, Utah--(BUSINESS WIRE)-- Owlet , Inc. (“Owlet” or the “Company”) (NYSE:OWLT), the pioneer of smart infant monitoring, today reports financial results for the second quarter ended June 30, 2024. Owlet’s Chief Executive Officer and Co-Founder, Kurt Workman, President and Chief Revenue Officer, Jonathan Harris, and Chief Financial Officer, Amanda Twede Crawford, will host a conference call to review the Company’s results and provide a business update today, August 12, 2024, at 4:30 p.m. ET.

Q2 2024 Financial Highlights:

Obtained CE Medical certification for UK and Europe, launching Dream Sock across major European markets.
Q2 Revenue was approximately $20.7 million, up approximately 58% year over year.
Q2 Gross Margin was approximately 50%, up approximately 1,000 basis points year over year.
Q2 Net Loss was approximately ($1.1) million, improving approximately 85% compared to Net Loss of approximately ($8.5) million year over year.
Q2 adjusted EBITDA was approximately $0.1 million compared to adjusted EBITDA loss of ($4.3) million in the same prior year period.

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They will be doing $200m+ in revenue by 2027. No brainer buy and hold for the next several years.

Agreed. I was very skeptical that they’d make it through the last year or so.

But they’ve been running the ship extremely lean and it probably taught Workman quite a bit that he’ll be able to carry forward.

quote:

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Owlet, Inc. (NYSE: OWLT) has recently engaged in private placements involving convertible preferred stock and warrants, structured as follows:

1. **Series A Convertible Preferred Stock**:
- **Conversion**: Holders can convert each share into approximately 145.77 shares of common stock.
- **Warrants**: Accompanying the Series A preferred stock, warrants were issued that allow the purchase of common stock at an exercise price of $4.66 per share. These warrants are exercisable until February 2028.
- **Redemption**: The Series A shares can be redeemed at $1,000 per share, plus any unpaid dividends, under certain conditions, or they can be converted to common stock at a specified rate.

2. **Series B Convertible Preferred Stock**:
- **Conversion**: Each share is convertible into about 129.66 shares of common stock.
- **Warrants**: The Series B preferred stock also comes with warrants allowing holders to purchase additional shares of common stock. The exercise price for these warrants is $7.71 per share, and they are exercisable until March 2029.
- **Redemption and Voting Rights**: The Series B shares also include provisions for redemption and voting, similar to those of the Series A stock, but with different conversion rates and seniority conditions.

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Per ChatGPT

These offerings were really attractive to the holders. Lots of equity option built in.

30M sounds right. I’ve done this exercise before and can’t find it.

I think valuation is still mostly related to the negative shareholder equity.

Either way solid margins and back to back bounces in revenue reaccelerating.

The Euro clearances are only going to help going forward. Opens the door to grow top line much faster.

ETA:

Series A (Feb ‘23) - 61.2M shares
- Warrants: “Each purchaser will also receive a warrant to purchase 180% of the number of shares of common stock into which their Series A preferred stock is convertible. The warrants will have a per share exercise price of $0.333 and will be exercisable by the holder at any time on or after the issuance date for a period of five years.”
OWLT IR

Series B (Feb ‘24) - 1.2M shares
- Each purchaser will also receive a warrant to purchase 150% of the number of shares of common stock into which their Series B preferred stock is convertible. The warrants will have a per share exercise price of $7.7125 and will be exercisable by the holder at any time on or after the issuance date for a period of five years.
OWLT IR

I’ve got to be reading this wrong. No way these offer an additional ~62M shares. Plus the warrant which could be another ~112M shares.

Creeping back up