ParaZero Technologies is the Next Potential 800% Winner

While the world has seen an uptick in unfortunate conflict this past week, war, terrorism and violence has actually been the catalyst for massive gains in the small cap world. First, Israeli stocks that can be loosely tied to defense like HUB Cyber Security Ltd. (HUBC), SuperCom Ltd. (SPCB) and Mobilicom Limited (MOB) shot up. Then on October 11, Tempest Therapeutics, Inc. (TPST) went up a ridiculous 4,000% on the day. That led to numerous small cap stocks spiking well in excess of 100% or even 500% in the coming days - with or without news - such as Versus Systems Inc. (VS), OpGen, Inc. (OPGN), Secoo Holding Limited (SECO), Bio-Path Holdings, Inc. (BPTH) and Sigma Additive Solutions, Inc. (SASI). Unfortunately for shareholders, most of these stocks gave back much of their gains. So if you chased or didn't take profits fast enough, you went from green to red quite quickly. 

Why did this happen? If you look at a long-term chart on these stocks, most resemble ski slopes from the steady stream of dilution at ever-lower prices. Stocks like VS and OPGN couldn't wait to push out further dilution either through new financings or warrant exercises. TPST tapped into $7 million of its $100 million shelf offering immediately after its spike, though we think that was a smart move. SPCB has a history of doing financings that kill any rally. For instance, the financing that was filed immediately after a spike in volume and a short-lived pop on July 31.

What shareholders need to look for in the next sustainable massive mover is a stock that is clean without a history of massive dilution. ParaZero Technologies Ltd. (PRZO) is just that stock. It is the best of both worlds as being an Israeli company specializing in drone safety systems, while also having a clean and tight share structure with only a $20 million market cap. The company just announced an expanded collaboration into the defense market for drones. It has only 6 million shares outstanding with a 2 million float. PRZO just did a $6 million IPO back in July, and according to that filing, the company will have sufficient cash to fund operating expenses and capital expenditure requirements through January 2025. So there is no plans to dilute any time soon, especially not below the IPO of $4.00. 

What has all of this resulted in? While most of the stocks we mentioned above pulled back substantially after their runs, PRZO ran 55% to close at $3.30 on Friday. Check out the price history posted below. This isn't a one day pump and dump. The run from $0.65 to $3.30 has been sustained. It pulled back to the $1.60 range for a couple of days then raced higher to make new highs. This is exactly the type of chart you want to see as a trader, not chasing pump and dump gambling plays up 800% in the morning then giving back most of those gains by the end of the day like OPGN. PRZO has the fundamentals as an Israeli defense play, it has a small float, and it has excellent chart technicals right now with a sustained run over several days. This is the type of stock that can give you an 800% winner.