24/7 Wall St.

DragonWave Inc. (NASDAQ: DRWI) is not exactly a new company nor is it exactly an initial public offering.  The stock has traded on the Toronto Stock Exchange under the ticker “DWI” since 2007.  It has also been a very strong stock in the Canadian trading as it was under $2.00 at the start of 2009 and rose to over $10.00 (Canadian Dollars) recently. Today, will mark the initiation of the listing on NASDAQ.

The company is a supplier of packet microwave radio systems, which is crucial in building a WiMAX network.  It recently posted quarterly results that beat market expectations and it also raised its 2010 fiscal revenue outlook.

The company’s key customer is Clearwire Corp (NASDAQ: CLWR), and that was about 77% of the company’s $35.5 million (Canadian Dollars) in revenues.  The company also made $0.21 EPS (also Canadian) in the last quarter, up from a loss of -$0.06 EPS a year earlier.

It is raising cash at $10.00 per share as well with its listing.  It is offering some 7,454,050 shares of common stock, and selling shareholders are selling 5,518,250 shares under the offering through the underwiters  Canaccord Adams and Piper Jaffray.  All in all, 12,972,300 common shares were sold for aggregate gross proceeds of $129.723 million (U.S. Dollars).

The company already has a slew of analysts covering the stock, so this will probably start to become a more recognized company for US investors soon.

JON C. OGG
OCTOBER 15, 2009