NEW YORK (TheStreet) -- Shares of Digital Ally Inc. (DGLY) - Get Report are gaining by 16.76% to $12.89 on heavy volume in late morning trading on Monday, as the company that develops, manufacturers, and markets advanced video surveillance products for law enforcement, homeland security, and commercial applications announced that it has been awarded GSA status by the U.S. General Services Administration.
The GSA is the procurement arm of the federal government and the "Schedule 84" award is basically a long term contract with the government.
The award "encompasses federal, state, and local government agencies that are purchasing video solutions for law enforcement, security, facilities management, fire and rescue, clothing, marine craft, and emergency/disaster response requirements," the company said in a statement.
Exclusive Report:Jim Cramer's Best Stocks for 2015
The contract is for five years and will allow federal, state, and local government customers to "efficiently purchase" a variety of Digital Ally's video evidence collection and management products and services.
"The GSA establishes long-term, government-wide contracts with commercial vendors in order to streamline and standardize the process of procuring products and services for the entire federal government. The GSA is the most widely used government contract vehicle, representing more than $32 billion in total contract volume in Fiscal 2014," Digital Ally continued.
"Digital Ally's inclusion as a GSA Schedule 84 vendor enables all government agencies to obtain hardware and software products, support, training, and warranty services at approved pricing and with authorized license terms from a trusted vendor," the company said.
Separately, TheStreet Ratings team rates DIGITAL ALLY INC as a Sell with a ratings score of E+. TheStreet Ratings Team has this to say about their recommendation:
"We rate DIGITAL ALLY INC (DGLY) a SELL. This is based on several weak investment measures, which should drive this stock to significantly underperform the majority of stocks that we rate. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- DIGITAL ALLY INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, DIGITAL ALLY INC reported poor results of -$1.14 versus -$0.99 in the prior year.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Electronic Equipment, Instruments & Components industry. The net income has significantly decreased by 606.6% when compared to the same quarter one year ago, falling from -$0.91 million to -$6.40 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, DIGITAL ALLY INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to -$2.35 million or 363.11% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The gross profit margin for DIGITAL ALLY INC is rather high; currently it is at 55.65%. Regardless of DGLY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DGLY's net profit margin of -137.17% significantly underperformed when compared to the industry average.
- You can view the full analysis from the report here: DGLY Ratings Report