A few weeks ago, a colleague of mine asked me for my mailing address. Then a package showed up at my front door. When I opened it, I was surprised to find a drone in a box.
There was another box that came with it.
Inside that box was an English dictionary.
Inside that dictionary was a lockbox.
And inside the lockbox was the controller for the drone.
I haven’t flown the drone yet. Turns out I need to register the thing. The biggest crime in my town tends to be going 35 MPH in 30 MPH zone. Or the $162 dollar fine for rolling through one of the few stop signs in the area. So, the last thing I wanted was my nosey neighbor wondering what I was flying around in my yard and dealing with officer Bob.
However, my interest was piqued in the product.
The drone came with an invitation to meet management and learn more about their products and an upcoming IPO (initial public offering).
Impressed with the marketing materials, I did something I never done before in all 23 years of working in the markets… I accepted the invitation to meet with management.
Most of my career has been about providing research or managing funds to short the market. In other words, I have been management’s mortal enemy. I’ve been threatened and yelled in my skirmishes with management.
Look, the CFO isn’t going to pat you on the back for figuring out he’s pulled the wool over investor’s eyes and exposed them for their shenanigans. There’s been no point to engage with management.
This time though, I’m genuinely interested in the product for a few reasons.
So, I headed out to Las Vegas and met with management.
The Power of Data
The company is Draganfly Innovations. It’s not some fly by night organization. Draganfly has been around over two decades. Next month, the company goes public.
Regular readers know that I have been a harsh critic of recent IPOs.
As my friend Charles Sizemore warned at the Irrational Economic Summit earlier this month, buy me a beer and I’ll talk your head off about WeWork. Of course, WeWork never made it to the public markets. Good riddance…
The business imploded before investors could be duped by an outrageous valuation. That’s been my biggest bone to pick. Investors like SoftBank haven driven up valuations to such crazy levels, there’s no upside left by the time these unicorns become public.
That doesn’t mean under the radar companies like Draganfly aren’t interesting. The most important takeaway from my trip was that there’s tremendous value in data. He who controls the data creates the most value.
The drones themselves are interesting. But anyone can make a drone. One advantage here for Draganfly is that the drones are not made in China. When dealing with U.S. government contracts that’s a massive edge for obvious reasons. Why would you buy a drone from China if you needed secure data?
And, that data is valuable. It’s used for agriculture, mining, national security, even to get a leg up in off-road racing. The uses are virtually limitless. Those drones collect valuable data. Data worth a lot of money.
That’s far different from a real estate company like WeWork that made up financial metrics and wanted to change the consciousness of the world.
Where I grew up, we call that bulls**t.
Meeting an Old Friend
The other advantage of going to Las Vegas was meeting up with a good friend of mine. He’s a professional horse bettor. My conversation about what’s going on with legalized gambling makes me even more bullish on the space.
The gambling business is a top pick in Hidden Fortunes. I think there’s 400% upside from here.
Last month I recommended an under-the-radar company that might complement the Draganfly’s of the world. It could be a huge winner in the national security space. The stock is quickly up 50%, with plenty more upside ahead if management can execute on their plan.
In the meantime, you can check out both recommendations. The upside is there right now. In the turbulent market of today, who knows when that might change. So, get in while the gettings good.