Since I first profiled Electro Energy Inc. (EEEI) on September 16, the stock first fell substantially to as low as 30 cents, and just recently has shot back up to the price it was when I wrote the article, a very cheap 50 cents.
I have bought the stock for myself and clients repeatedly in the intervening dip, and I made another purchase at $.50 today because of two news items which dramatically improve the prospects for the company.
On October 29, they announced that they raised $750,000 bridge financing from KIT Financial, and yesterday they announced a $2 million research funding as part of a recent Department of Defense Funding bill. Both of these are excellent news, and they go a long way towards easing the cash crunch which has put their continued solvency in doubt and depressed the share price to such a low level.
EEEI still needs to raise money, but future raises are also likely to be on better terms because of their stronger balance sheet, and the likelihood that they will commence high volume shipments of batteries from their Gainesville plant in early 2008.
DISCLOSURE: Tom Konrad and/or his clients have positions in EEEI.
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