Boston, MA 03/19/2014 (wallstreetpr) – Kandi Technologies Group Inc. (NASDAQ:KND) has announced it has entered into a securities purchase agreement with two institutional investors, for the placement of its common stock in a deal worth $11.05 at a share price of $18.24. Kandi Technologies as part of the transaction will issue 606,000 shares to the institutional investors and also warrants of purchase of up to 90,000 shares of its common stock, at a share price of $22.80. The warrants have a term of $18 months from the date of issuance.
Kandi Technologies Group Inc. (NASDAQ:KND) intends to use the proceeds of the offering for general working capital with the placement expected to be completed on March 24, 2014 subject to customary closing conditions. The securities are being offered through prospectus supplement with a shelf registration being filed with the Securities and Exchange Commission.
Kandi commands an average dollar volume of $72.1 million with a 30 day shares moving average of 2.5 million shares. Its market cap currently stands at $617.2 million forming part of the consumer goods and automotive industry. Kandi Technologies stock is currently rated as a “Hold” in the market
Kandi Technologies Group Inc. (NASDAQ:KND) strengths in the market can be seen in its robust revenue growth over the recent quarter with solid stock prices and good cash flow levels. The company’s weaknesses on the other hand can be seen in feeble growth accompanied with decreasing earnings per share as well as deteriorating net income and a poor return on equity.
Why Kandi Technologies is a Hold in the market
Kandi Technologies Group Inc. (NASDAQ:KND) main strength as of the moment is its revenue growth metrics that has seen revenues grow by highs of 34.3% over the past year, exceeding the industry average of 3.7%. The major concerns seem to lie on the fact that the revenue growth has not trickled down the company bottom line, to cause an increase in earnings per share.
The company’s share price has also grown by a high of 361.06% compared to the same period a year ago exceeding the performance of the broader industry. Its debt to equity ratio is at a low of 0.67 less than the industry average suggesting better debt management levels. A steep decline in earnings per share in the recent quarter earnings has harm the company’s appeal with investors, necessitating the hold rating.
