US Nuclear Corp (OTCMKTS:UCLE) is the new talk of the town. Within a week, the price skyrocketed to a new high of $2.0 after it had remained within the $0.35 range for nearly a year. In this piece, we give a brief introduction to the company and all of the recent developments that contributed to its success.
First, take a look at the stock price action over the past year:
Company Profile
US Nuclear Corp. founded in February 2012 and is headquartered in Canoga Park, California. The company designs builds and manufactures radiation safety and monitoring instruments. It provides a full line of radiation detection equipment and services to clients industries such as nuclear reactor plants, universities, local and state hospitals, government agencies, the military and emergency medical technicians or EMT/first responders. Its products include Radiation Water Monitors; Tritium Monitors; Alpha, Beta, Gamma and Tritium Monitors; DroneRAD Aerial Radiation Detection; Air and Water Monitors; Vehicle Monitors, Personnel Monitors, Exit Monitors and Room Monitors; Radon Air Monitors and Radon Switch Products; Handheld Survey Meters and Personal Dosimeters, Pocket Micro-R Meters, as well as Port Security Equipment, and software solutions. It operates through the Optron and Overhoff segments. The Optron segment is located in Canoga Park, California. The Overhoff segment is located in located in Milford, Ohio.
It also provides vehicles, personnel, exit, and room monitors; radon air monitors and radon switch products; handheld survey meters, as well as personal dosimeters and pocket Micro-R meters; and port security equipment. Also, the company offers software, which measures gamma and neutron radiation levels; airborne radioactivity levels; temperature and humidity in the facility; status of security doors; wind speed and direction; and barometric pressure. Its products and services are used in nuclear reactor plants, universities, local and state hospitals, government agencies, and emergency medical technicians/first responders, as well as in airports, cargo, screening at ports and borders, and other critical infrastructure.
Recent Developments
Very recently, the company signed a letter of intent with MIFTEC to become the exclusive contractor to manufacture medical isotope generators in the nuclear medicine market. MIFTEC’s parent company, MIFTI Nuclear Fusion, was recognized and awarded by the U.S. ARPA-E for their innovative approach and rapid progress towards fusion energy, which could provide a nearly limitless supply of clean, domestic power. MIFTI has shown that its Staged Z-Pinch fusion technique will produce high neutron flux, which in turn can be used to produce medical radioisotopes.
MIFTEC released a comment explaining that there is a terrible shortage of medical scanning isotopes which mean millions of patients are unable to get the diagnostic scans and treatment they need due to the shortage and deteriorating sources of medical isotopes from Russia, Belgium, Canada, and South Africa.
It is believed that MIFTEC’s breakthrough solution could solve this medical isotope shortage, and at a fraction of the cost. MIFTEC believes it can cut the current cost of producing radioisotopes by at least 50%, thereby allowing even greater access to individuals that need them.
US Nuclear Corp. will also acquire a 10% interest in MIFTEC, and is working with BMA Securities to raise funds on a best efforts basis.
In July 2017, it was awarded a $0.7 million contract to supply the U.S. Air Force with a new fleet of portable Tritium air monitors, bringing their current order backlog up to $2.4 million. The new monitors will replace the fleet of obsolete instruments currently being used. Sandia National Laboratories was enlisted to help the USAF in testing and selecting an appropriate replacement model, and after several years of deliberation, US Nuclear (Overhoff division) was awarded the contract.
Robert Goldstein, CEO of US Nuclear Corp commented that it was an honor for its instrument to be selected as the best by Sandia and the USAF, who enlist some of the smartest people in the instrumentation industry. He added that in spite of the difficulty in receiving the contract, management remained confident in the quality and performance of its product. Units will be delivered in partial shipments every month throughout the rest of the year until the quota is met, with payment prior to each shipment to generate cash-flow and keep momentum strong through 2017.
The portable tritium monitors are a critical safety instrument, measuring tritium concentration in the ambient air by pumping the air through a set of ionization detectors. An audible and visual alarm will sound if levels exceed the alarm limit, warning the user to evacuate or take action.
Company Financials
The firm’s statement of comprehensive income reveals that revenues dropped by 21% year on year, falling from $2.65 million to $2.1 million in 2016. This as well as some non-recurring expenses led to a net loss of $1.6 million during the year.
The firm is very highly leveraged with its liabilities consisting 90% of its capital. Its high liquidity of 2 remains a source of assurance to investors that the business is capable of financing its immediate operating costs
Conclusion
UCLE’s success in winning the contract with the US Airforce demonstrates that the company will be successful for a while yet.
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Disclosure: We have no position in UCLE and have not been compensated for this article.
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