Capstone Companies Inc - CAPC stock

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Capstone Companies, Inc. (CAPC) is a public holding company that designs, manufactures, and markets consumer-inspired products incorporating recent technological innovations. The company is historically known for exploiting technologies in induction charging, home LED lighting, power failure control, and security products. It recently stormed the electronic market with its new novel Capstone’s Smart Mirrors. Capone's lighting products portfolio includes connected surfaces–smart mirrors, Eco-i-Lites, fitness mirrors, LED motion sensor lights, LED puck lights, LED under cabinet light bars, wireless remote-controlled LED accent lights, and wireless remote-control outlets. Capstone distributes its consumer products to retail outlets throughout North America and globally through its wholly-owned subsidiaries. Capstone Industries, Inc., Capstone International HK, Ltd., and Capstone Lighting Technologies, LLC substitute the company’s subsidiaries. The firm markets its products under the name of Capstone Lighting and Hoover Home LED. It uses hardware centers, warehouse clubs, and e-commerce websites to sell its products.[1] The firm was formally named CHDT Corporation before changing its name in June 2012 to Capstone Companies, Inc. Capstone was incorporated in 1986 under the laws of the State of Florida. The company is headquartered in Deerfield Beach, Florida. Its common stock is listed on the OTCQB Venture Market of the OTC Markets Group, Inc. under the CAPC ticker.[2]

Business Operations[edit]

The company’s long-term strategy focuses on expanding its product development and engineering, manufacturing base, marketing, and distribution of its end consumer products. The firm’s products mostly target applications for home indoor and outdoor lighting. It is committed to pursuing new revenue generation opportunities by introducing and expanding its connected market portfolio alternative distribution channels such as e-commerce and others that it had not explored initially. The firm also looks to leverage its existing customer base and connections to source new organic growth initiatives within its emerging investment categories. Capstone's outstanding strength has been the ability to identify emerging products in the line of technology, including the LED lighting category, where the company successfully applied its branding and product strategies to command a respectable position in the market. The company’s new products have connectivity features comparable to modern smartphones and tablets. Its Lighting and Hoover Home LED brands have jointly sold millions of products over the recent years.[3]

Capstone’s mirror perfectly works like a smartphone with efficient features, including a touch screen, internet connectivity, voice interfacing, and an operating system equipped to run downloadable applications. The mirror allows users to access social media feeds, voice assistance, listen to music, check traffic and weather updates, and stream entertainment, among other functions. Its smart mirror launch was announced in February 2021, but the first shipment of the product began in the first quarter of 2022 due to the rise in variants of COVID-19 in Thailand. The company produces portable codeless LED Accent Light Bars with magnetic mounting plate adhesives that facilitate their mounting on surfaces. They are also accompanied by remote controls that enable the user to switch multiple lights, dimmer presets for adjusting the brightness of the lights, and a timer feature for auto-switching off the lights. Its LED lighting products are sold nationally and globally under the Capstone Lighting brand, available via Amazon and Wayfair e-commerce Websites. LED products are distributed to customers through direct sales internationally, including to consumer markets across Australia, Japan, South America, Korea, North America, and the United Kingdom.[4]

Corporate History and Milestones[edit]

Capstone Industries, Inc., Capstone’s primary subsidiary, was incorporated as a Florida corporation to distribute and sell the firm’s products. The company established Capstone International Hong Kong, Ltd. (CIHK) to facilitate the expansion of Capstone’s product development, engineering, and factory resource capabilities. A shift in production activities from Thailand to China led to the downsizing and gradual termination of CIHK operations in March 2022. The company’s focus through 2017 was on integrating LED into the most commonly used consumer products. With the erosion of LED prices over the past years, Capstone came up with the Connected Surfaces approach to create a business in an emerging sector that would create future revenue growth for the firm and all shareholders and facilitate its ultimate growth. It settled on the smart home segment as the long-term beneficiary of its Connected Surfaces program. The company began its journey into the electronics market in 2019 with the Connected Surfaces Smart Mirrors.[5]

Vital Company News[edit]

The company provided its fiscal and operational results for the quarter that ended September 30,20,2022 and updates for the preceding nine months on November 14, 2022. Highlights of the results include:

  • The company incurred a net loss of approximately $1.452 million on the back of about $1.603 million used cash in operations
  • As of September 30, 2022, the firm had approximately $107 thousand working capital,
  • An accumulated deficit of approximately $7.890 million,
  • $262 thousand in the cash balance,
  • Short-term notes payable of $1.068 million and $886 thousand of long-term liabilities for notes payable and deferred taxes

The company attributed the reduction in its brick-and-mortar retail sector to the global resurgence of the COVID-19 pandemic and the development of new vaccine-resistant strains of the novel virus that might have paralyzed the movement of customers to retail stores, thereby reducing consumer traffic and spending. The company indicated its strong belief in the successful relaunch of its Smart Mirror portfolio using the online retail platform that would decrease its extreme dependence on the brick-and-mortar and e-commerce websites of Big Box retailers for revenue generation in the future.[6]

Capstone Leadership[edit]

Stewart Wallach, President and Chief Executive Officer

  • Joined the firm in 2006 as a director and was appointed the company’s President and CEO in 2007
  • Founded Capstone Companies, Inc., the firm’s primary subsidiary, in 1998 and became the company’s Chief Executive Officer and Chairman of the Board
  • He co-founded Examsoft Worldwide, Inc., a firm that provided laptop-examination security software technology for numerous educational institutions and state examiners
  • He also founded Systematic Marketing, Inc., which Sagaz Industries, Inc. later acquired, where Mr. Wallach served in the President’s position for ten years.

Other board members are James G. McClinton, Chief Financial Officer; George Wolf, Corporate Business Development; and Aimee C. Brown, Director of Administration.[7]

OTC Symbol: CAPC | OTC Tier: OTCQB