Emerging Markets
Probility Media Corp (OTCMKTS: PBYA) Blue Sky Breakout as Online Education Pioneer Cleans up Balance Sheet, Reports Record Revenues and Acquires Upstryve Inc
Published
3 years agoon
By
Boe RimesProbility Media Corp (OTCMKTS: PBYA) is skyrocketing up the charts recently moving well into copper land and emerging as a volume leader in small caps regularly trading between $5 and $10 million in daily trading volume. The stock has a huge following and is emerging as an investor favorite and is currently among the most actively searched and talked about stocks in small caps. PBYA is looking to blaze a path along the likes of Enzolytics or Tesoro and break out into a whole new dimension – Tesoro went to multi dollars – currently PBYA is on a blue-sky breakout! It’s easy to get excited about a stock like PBYA; while it does have over 2 billion shares OS the Company has been busy cleaning up its balance sheet and according to its most recently filing the Company had well over $300k in the treasury, $3.3 million in assets and just $1.2 million in total liabilities putting it in the top 1% of the OTC. PBYA reported $7,642,786 in sales for the fiscal year ended March 31, up from $6.8 million last year however this does not include recently acquired Upstryve Enterprise, a leader in high quality training courses and materials that includes many fortune 500 Company’s as clients.
PBYA is already a major player in the online booming multi-billion-dollar vocational education and training market place and has been growing through strategic acquisitions. Most recently the Company acquired Upstryve Inc, the leader in online tutoring for the vocational industry, and its intention to rename itself to Upstryve. Upstryve Enterprise, is a full proprietary platform designed for corporations of all sizes. As a combined group of companies, Upstryve owns over 500 test prep courses, 600 self-study books and teaches over 1,000 annual virtual classes through One Exam Prep. It will conduct over 400 safety programs through North American Crane Bureau with numerous Fortune 500 clients such as Tesla (Nasdaq: TSLA), Alcoa (NYSE: AA), General Electric (NYSE: GE), Lockheed Martin (NYSE: LMT), IBM (NYSE: IBM), U.S. Steel (NYSE: X), Flour (NYSE: FLR), Los Alamos National Labs, United States Navy and Air Force and many more. Through Disco Learning Media, it will specialize in eCourse development, program management, and consulting for companies such as Itron (NASDAQ: ITRI), The University of Texas, the State of Texas K-12 schools and many more organizations.
ProBility Media Corp. is an industrial education and training technology company headquartered in Coconut Creek, Florida, offering education online and in person programs including training in a variety of vocational industries. ProBility is executing a disruptive strategy of defragmenting the education and training marketplace by offering high quality training courses and materials to prepare the workforce for excellence. ProBility services customers from the individual to the small business to the enterprise level corporation.
Microcapdaily has reported on PBYA before starting on September 15, 2018 stating at the time: “PBYA is one exciting story in small caps; the Company is executing a disruptive strategy of defragmenting the vocational education and training market place and has made a number of important acquisitions over the past year which has resulted in significant sales which are up over 100% this year over last.”
PBYA has a number of subsidiaries making big moves; NACB, a subsidiary of ProBility Media Corp., conducts over 400 safety programs each year all over the world. A partial list of customers includes companies such as Alcoa, Dow Chemical, Exxon Mobil, Fluor, General Electric, IBM, Kaiser Aluminum, Lockheed Martin, Los Alamos National Labs, Shell Oil, U.S. Navy, U.S Steel and many more. With training facilities located in Central Florida, Cincinnati, OH and Southeast Texas, customers can receive hands-on crane operator training at these locations. Several days ago, the NACB initiated new training programs for Tesla (Nasdaq: TSLA), Marathon (NYSE: MRO) and BAE Systems (OTC: BASEY). Another subsidiary of PBYA is One Exam Prep, offering over 500 online courses and test preparation for contractors in over 15 states. In addition, One Exam has published over 300 test preparation books that have become some of the most widely sold materials in multiple trade industries including that of electrical work. One Exam Prep is also a licensed and accredited continuing education provider in the state of Florida. On June 30 PBYA reported online classes have seen a fivefold increase since the start of Covid-19. One Exam Prep has quickly become one of the largest test prep companies in Florida.
The Company subsidiary NACB recently initiated new training programs for Tesla (Nasdaq: TSLA), Marathon (NYSE: MRO) and BAE Systems (OTC: BASEY). These programs consists of onsite training for crane operators, inspectors, rigging personnel and signal personnel and lift equipment trainers within these organizations. In addition, these engagements are long term training arrangements that are expected be replicated throughout their corporate footprint.
ProBility recently announced the acquisition of Upstryve Inc, the leader in online tutoring for the vocational industry, and intention to rename itself to Upstryve. The Company also announced its intention not to affect a reverse split in connection with the acquisition. Upstryve is the only tutoring platform dedicated to providing aspiring professionals an affordable all-encompassing learning experience. Upstryve provides 1 on 1 contractor license exam preparation for professionals to confidently pass their state or national exams and obtain their contractor license. It’s platform links aspiring trade professionals with expert trade tutors and instructors who have years of experience in the field. Students work with tutors who guide them through typical struggles and help them gain the confidence they need before exam day.
It’s instructors specialize in exam preparation for all construction and trades, National Trade Association Exams, Contractors, Electricians, Plumbing, HVAC, Engineering, Healthcare, Utilities and more. Upstryve offers existing industry experts to earn from three sources, hourly tutoring at their desired hourly rate, affiliated sales of study materials and the ability to publish study materials, test questions and specialized courses through its publishing platform. For more information, visit www.upstryve.com.
Upstryve Enterprise, is a full proprietary platform designed for corporations of all sizes. The corporate platform assists in workforce training, career coaching, employee retention and employee centered initiatives. Career coaches in the enterprise platform assist in developing skills in leadership, empathy, communication, problem-solving and teamwork. Creating teams with skills beyond their training and rooted in their company’s values increases job satisfaction, workforce retention and overall business productivity. Upstryve believes that when teams are fully invested in their roles, they feel motivated, passionate and prepared for excellence.
As a combined group of companies, Upstryve owns over 500 test prep courses, 600 self-study books and teaches over 1,000 annual virtual classes through One Exam Prep. It will conduct over 400 safety programs through North American Crane Bureau with numerous Fortune 500 clients such as Tesla (Nasdaq: TSLA), Alcoa (NYSE: AA), General Electric (NYSE: GE), Lockheed Martin (NYSE: LMT), IBM (NYSE: IBM), U.S. Steel (NYSE: X), Flour (NYSE: FLR), Los Alamos National Labs, United States Navy and Air Force and many more. Through Disco Learning Media, it will specialize in eCourse development, program management, and consulting for companies such as Itron (NASDAQ: ITRI), The University of Texas, the State of Texas K-12 schools and many more organizations. ProBility’s presence with numerous corporations will allow Upstryve to offer them a 21st century online training platform and ways to connect its employees with industry professionals.
The Company operates in a fast growing sector especially during the current pandemic. According to a report published in October 2020 by Grandview Research, the global online tutoring services market was valued at $4.81 billion in 2019 and expected to expand at a compound annual growth rate of 16.1% from 2020 to 2027 with a projected revenue forecast of $15.99 billion. Similar online tutoring marketplaces have gained large valuations such as Varsity Tutors a subsidiary of parent company Nerdy. It recently announced a sale to TPG Pace Tech Opportunities (NYSE: PACE) via a SPAC which will go public under the symbol (NYSE: NRDY). Varsity Tutors received a $1.7 billion valuation in February 2021. Upstryve’s group of companies has trained or educated over 500,000 trade professionals and students.
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While PBYA has committed to no reverse split what many penny stock speculators may not know is that real Companies with real sales and a good chance of moving to a national exchange usually increase in value significantly directly following the RS. We covered many examples in this article.
PBYA has been busy beefing up its management team; they named Dana Jackson as Chief Operating Officer. Mr. Jackson currently holds the position of Vice President of Sales and Marketing at North American Crane Bureau. In addition to sales, Mr. Jackson has handled all logistics and operations for training programs. Prior to NACB, Mr. Jackson had previously worked in sales related to education learning management systems . Mr. Jackson holds key relationships with Fortune 500 companies and training directors across multiple industries which will be invaluable to ProBility’s growth.
ProBility has also named Lauren Paino as new Chief Financial Officer (CFO). Ms. Paino has held a position at North American Crane Bureau as Controller for the past three years. She has also been instrumental in ProBility’s restructuring efforts and work to bring the Company current with OTC Markets. Ms. Paino will take over the role from Noah Davis who will remain as President of the Company.
ProBility has also named Juan Garcia as Chief Learning Officer (CLO) for the company. Mr. Garcia was co-founder and President of Disco Learning Media (Disco) prior to selling the company to ProBility in 2018. Since that time he has remained as President of Disco. He brings his years of experience in working with the academic world including Government agencies, nonprofits and universities. He was behind the development of programs such as Energy 101, Top Core as well as others.
ProBility has named Johanna Viscaino as Chief Marketing Officer (CMO) for the company. Ms. Viscaino previously held the same position at Upstryve. She is an experienced digital content producer in the e-learning industry. She has been a key part to the branding and growth behind the brands in the company.
ProBility has named Ori Gross as Chief Information Officer (CIO). Mr. Gross has worked with ProBility since before the original reverse merger in 2016. He has served as head of IT during that time. He brings his years of experience with learning management systems and e-commerce platforms.
On August 16 PBYA announced its status has changed to penny stock exempt as per OTC Markets. To qualify for “Penny Stock Exempt” on OTC Markets, an issuer must satisfy one of the following requirements: (i) the issuer’s securities have a minimum price greater than $5 per share; (ii) the issuer has average revenues of at least $6 million for the last (3) years; or (iii) the issuer has net tangible assets exceeding $2 million, if the issuer has been in continuous operations for at lease (3) years or $5 million if less than three (3) years.
Through a series of unfortunate events in 2018, ProBility’s balance sheet became inflated with debt and its stock price depressed significantly through 2019. Following the Company’s changes from 2019 through 2021 including, reduction and settlement of convertible and straight debt, elimination of non-performing business units, replacement of certain members of management, growth of its remaining divisions by digital marketing and transitioning much of its programs online allowed the company to achieve operational profits starting in Fiscal year end 2020.
As part of the recent efforts to restructure its balance sheet, the Company has successfully settled about $500,000 of convertible debt for restricted common stock. The restricted common stock was included in the shares issued to the shareholders of Upstryve in connection with acquisition. The note holders have stated they are encouraged by the recent strides the Company has made in bringing the company current with OTC Markets and its restructuring.
“We are excited to see another positive result in Probility’s ascension to a legitimate security and Company in the eyes of regulators.” stated Noah Davis, President of ProBility. “Over the past several months, we have achieved many successful wins for the company including the continued clean-up of our balance sheet, new customer contracts, becoming current with our filing obligations pursuant to SEC Rule 15c-211 and OTC Markets and acquisition of Upstryve. We remain committed to continuing our goal of becoming a Company capable of being eligible for higher exchanges and recognition among investors as legitimate contenders in the online education and tutoring industry with a unique focus on vocational education.”
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Probility Media Corp is skyrocketing up the charts recently moving well into copper land and emerging as a volume leader in small caps regularly trading between $5 and $10 million in daily trading volume. The stock has a huge following and is emerging as an investor favorite and is currently among the most actively searched and talked about stocks in small caps. PBYA is looking to blaze a path along the likes of Enzolytics or Tesoro and break out into a whole new dimension – Tesoro went to multi dollars – currently PBYA is on a blue-sky breakout! It’s easy to get excited about a stock like PBYA; while it does have over 2 billion shares OS the Company has been busy cleaning up its balance sheet and according to its most recently filing the Company had well over $300k in the treasury, $3.3 million in assets and just $1.2 million in total liabilities putting it in the top 1% of the OTC. PBYA reported $7,642,786 in sales for the fiscal year ended March 31, up from $6.8 million last year however this does not include recently acquisition of Upstryve Enterprise, a leader in high quality training courses and materials that includes many fortune 500 Company’s as clients. PBYA is already a major player in the online booming multi-billion-dollar vocational education and training market place and has bene growing through strategic acquisitions. Most recently the Company acquired Upstryve Inc, the leader in online tutoring for the vocational industry, and its intention to rename itself to Upstryve. Upstryve Enterprise, is a full proprietary platform designed for corporations of all sizes. As a combined group of companies, Upstryve owns over 500 test prep courses, 600 self-study books and teaches over 1,000 annual virtual classes through One Exam Prep. It will conduct over 400 safety programs through North American Crane Bureau with numerous Fortune 500 clients such as Tesla (Nasdaq: TSLA), Alcoa (NYSE: AA), General Electric (NYSE: GE), Lockheed Martin (NYSE: LMT), IBM (NYSE: IBM), U.S. Steel (NYSE: X), Flour (NYSE: FLR), Los Alamos National Labs, United States Navy and Air Force and many more. Through Disco Learning Media, it will specialize in eCourse development, program management, and consulting for companies such as Itron (NASDAQ: ITRI), The University of Texas, the State of Texas K-12 schools and many more organizations. We will be updating on PBYA when more details emerge so make sure you are subscribed to Microcapdaily so you know what’s going on with PBYA.
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Disclosure: we hold no position in PBYA either long or short and we have not been compensated for this article.
Emerging Markets
Bitfarms (NASDAQ: BITF) in Focus: Exploring the Meteoric 110% Surge and Macro Influences
Published
10 months agoon
December 7, 2023Bitfarms Ltd. (NASDAQ: BITF) rides the wave of explosive growth surging by over 110% from its lows of $1.03 per share in November. This BTC miner has witnessed a 41% increase since last Friday, December 1st, 2023. If you’ve been keeping up with our recent articles, you’ll notice that majority of coverage lacks substantial press releases or filings supporting a surge in valuation. Today’s coverage includes precisely that and more. Let’s delve deeper into BITF to assess if this crypto miner is worth considering amidst the ongoing rise in spot BTC.
Background:
Established in 2017, BITF has established itself as a global leader in Bitcoin (BTC) mining. Utilizing its computational power, the company contributes to various mining pools, earning payment in Bitcoin.
BITF sets itself apart by developing, owning, and operating vertically integrated mining farms. These facilities feature in-house management, company-owned electrical engineering services, installation support, and multiple on-site technical repair centers, ensuring a comprehensive operational setup. Bitfarms relies on its proprietary data analytics system, ensuring superior operational performance and uninterrupted service.
Currently managing 11 farms across four countries—Canada, the United States, Paraguay, and Argentina—Bitfarms predominantly uses environmentally friendly hydro-electric power and maintains long-term power contracts. The company remains dedicated to employing sustainable energy sources, often utilizing locally available and under-utilized energy infrastructure.
In its recent upgrade initiative, BITF has improved its fleet’s efficiency and capital practices ahead of the Halving. This strategic move aims to boost its capital-efficient fleet to 12.0 EH/s by Q2 2024. The focus lies in reducing miner and energy costs, enhancing fleet energy efficiency, and fostering greater pricing flexibility for sustained growth and success.
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Market Update:
At the core of BITF’s latest momentum and strength lies its connection to macro-scale factors. To provide deeper insights into BITF’s future prospects, we’ve conducted a comprehensive market analysis.
The latest market surge propelled spot BTC above the USD $44,000 mark at its peak, reaching its highest value in more than 19 months. This remarkable rally emphasizes the enduring positivity shared among retail and institutional traders alike.
Blackrock ETF:
The primary driving force behind Bitcoin’s ascent appears to be rooted in market expectations of an approved spot BTC exchange-traded fund (ETF) in January 2024. This anticipation has spurred substantial cash inflows from institutional investors, contributing significantly to Bitcoin’s current trajectory.
If the approval unfolds as anticipated, it has the potential to bring a substantial wave of fresh capital into Bitcoin. According to certain projections, this approval might introduce up to $50 billion in new liquidity to Bitcoin. The precise impact on Bitcoin’s price remains uncertain; however, a particular model suggests a 4% price surge for every $1 billion that enters Bitcoin. Consequently, if the projected $50 billion materializes, Bitcoin could potentially double or even triple in value.
Rumours from Qatar:
As per bitcoin enthusiast Max Keiser, Qatar’s sovereign wealth fund (QSWF) (mainly tasked with managing the nation’s extensive oil and gas-derived wealth), is contemplating a significant investment spree of up to $500 billion in the flagship cryptocurrency, Bitcoin.
To offer a comparison, this proposed investment dwarfs the disclosed Bitcoin holdings of MicroStrategy, founded by Michael Saylor, by an astonishing 671 times. Presently, MicroStrategy stands as the largest corporate holder of Bitcoin, possessing 174,530 BTC following its acquisition in November.
Keiser is notably optimistic that QSWF’s monumental investment could propel the price of bitcoin to reach soaring highs of $100,000.
Binance Update:
In the aftermath of former Binance CEO Changpeng Zhao’s guilty plea and the subsequent $4.3 billion settlement with the U.S. Department of Justice (DOJ) on Nov. 21, Bitcoin’s price initially showed mixed signals. Contrary to expectations, Binance did not experience a mass exodus of funds similar to what FTX faced during its public liquidity crisis. Notably, prominent figures in the crypto space, such as Galaxy Digital CEO Mike Novogratz, perceive the settlement as a positive development overall.
At first, Binance’s Bitcoin reserves dropped by 17% from their peak. Following the initial outflows, the balance has shown an increase of nearly 1%. As for FTX, their BTC reserves fell a staggering 99.9% from all-time highs in November 2022 ,with no recovery in sight.
This serves as a significant testament to Bitcoin’s resilience at present, even as the largest cryptocurrency exchange by volume faces a monumental lawsuit. Unlike the substantial impact experienced by FTX, this legal challenge did not severely affect BTC reserves.
So What?:
With multiple factors driving spot BTC, smaller-scale BTC miners are becoming increasingly attractive -especially considering the potential financial growth and rising profit margins. Let’s delve into the recent developments concerning BITF for a closer look.
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What Happened:
On December 1st, 2023, BITF released a comprehensive performance and financial update, revealing robust figures for their BTC mining operations. Based on this report alone, it’s evident that BITF boasts a substantial global operational capacity and possesses the financial support needed to remain competitive, particularly as BTC mining grows more challenging post-halving. To enhance clarity, we’ve restructured the release into bullet points for easier comprehension.
BTC Production: November production recorded 392 BTC, a 1.5% decline from October. The network difficulty surged by 19.0% in November, indicating strong miner demand leading into the 2024 Halving.
Network Metrics: For the eleven months ended November 30th, network difficulty increased by 92.2%, while BTC’s price rose approximately 128.4%. This resulted in a 33.9% improvement in production economics measured by USD/TH/day.
Operating Highlights:
- 6.4 EH/s was online by November 30, 2023, marking a 45% increase from November 30, 2022.
- 66.4 BTC/average EH/s was recorded, down 1.9% from October 2023.
- 13.1 BTC earned daily on average in November, equivalent to about $495,200 per day based on a BTC price of $37,800 on November 30, 2023.
Expansion Initiatives:
- Firm purchase order placed for 35,888 Bitmain T21 miners, with an option for an additional 28,000 T21 miners.
- Finalizing contracts to expand operating capacity from 30 MW to 50 MW at Paso Pe, adding 20 MW of hydro-miner containers.
Financial Update:
- Raised $44 million in gross proceeds through a private placement of common stock and warrants.
- Sold 350 BTC, generating $12.8 million in total proceeds.
- Added 42 BTC to treasury, holding a total of 802 BTC, valued at approximately $30.3 million based on a BTC price of $37,800 at November 30, 2023.
- Held Synthetic HODL™ of 35 long-dated BTC call options as of November 30, 2023.
- Reduced outstanding indebtedness by $1.9 million, leaving a remaining balance of $6.0 million at November 30, 2023.
Technical Analysis:
We’re noticing a trend among retail traders on social platforms like X, discussing technical trading patterns related to crypto miners, specifically highlighting positive momentum linked to an Inverse Head and Shoulders (IHS) pattern. A user, @FreeDoomCapital, suggests that among all miners, BITF seems to exhibit the clearest pattern. Here’s a brief explanation of the pattern to enhance your comprehension.
The Inverse Head and Shoulders (IHS) pattern is a technical analysis formation commonly observed in financial markets, particularly in stocks, currencies, and cryptocurrencies. It’s considered a bullish reversal pattern and typically appears after a downtrend.
Here’s a further breakdown on the pattern:
- Formation: The pattern consists of three successive troughs. The middle trough (the “head”) is the lowest point, while the two surrounding troughs (the “shoulders”) are higher than the head and relatively symmetrical in height.
- Shoulders: The left and right shoulders are formed at the end of a downtrend. They show a decline in price followed by a temporary stabilization or slight increase before declining again.
- Head: The head is formed after the left shoulder, indicating a further decrease in price, often reaching a new low. However, the head is typically higher than the previous trough, indicating a potential shift in the downward momentum.
- Neckline: The neckline is a trendline connecting the highs of the two shoulders. It acts as a critical level; a breakout above this line is a significant signal for a potential trend reversal.
- Volume: Volume analysis can complement the pattern. Generally, during the formation of the left shoulder, the volume decreases, increases during the head formation, and decreases again during the right shoulder formation. A breakout with higher volume after the formation is considered a stronger confirmation of the pattern.
- Confirmation: A confirmed Inverse Head and Shoulders pattern occurs when the price breaks above the neckline. Traders often look for a sustained move above the neckline to confirm the reversal.
The Inverse Head and Shoulders pattern is considered complete when the price breaks above the neckline, indicating a shift from a downtrend to a potential uptrend. Traders and analysts use this pattern as a signal to anticipate higher prices, and they often set price targets based on the distance between the neckline and the head.
Similar to all technical trading patterns, it’s important to recognize that it’s not foolproof and may not be accurate in every instance. However, it’s noteworthy that several sources are paying attention, particularly due to the apparent clarity of BITF’s formation of an IHS pattern in their lineup.
Conclusion:
An essential consideration with BTC miners is the increasing difficulty of mining the digital asset after halving, which is scheduled for around April 2024. BITF’s recent fleet upgrade aims to strengthen its capacity pre-halving, positioning itself as a frontrunner. With spot BTC around USD $44,000, the 392 BTC mined in November alone would translate to approximately USD $17 million in top line revenue. If potential BTC catalysts sky rocket the price to USD $150,000 as some suggest, November’s mining performance would represent nearly $60 million – and that’s just in one month. As one of the leading BTC miners globally, we highly recommend keeping BITF on your radar.
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Disclosure: We have not been compensated for this article/video. MicroCap Daily is not an investment advisor; this article/video does not provide investment advice. Always do your research, make your own investment decisions, or consult with your nearest financial advisor. This article/video is not a solicitation or recommendation to buy, sell, or hold securities. This article/video is our opinion, is meant for informational and educational purposes only, and does not provide investment advice. Past performance is not indicative of future performance.
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Emerging Markets
Music Licensing Inc. (OTC: SONG): Unraveling the 1250% Surge and Current Valuation
Published
11 months agoon
November 10, 2023Music Licensing, Inc. (OTC: SONG) shares skyrocket a whopping 100% gain at the time of writing, marking an incredible 1250% surge since their October low of $0.0004. Many appear to be wondering the cause behind the sudden rise and after today’s spike we decided to do more research. Let’s dig into the company and its recent updates to figure out how they’ve pulled off such an impressive climb and what might be coming next.
Background:
Starting with their name – Music Licensing, Inc., it is more commonly recognized as Pro Music Rights. If you’re diving into your own research, you’ll likely want to search by, “Pro Music Rights” to find the investor information you’re looking for, you won’t find much under the stock name alone.
In a nutshell, SONG is a performance rights organization (PRO) and was the 5th to be established in the United States. If that mean’s absolutely nothing to you, skip to the next title for a better understanding.
Nethertheless, they’ve got some big players under their license umbrella, including TikTok, iHeart Media, Triller, Napster, 7Digital, and Vevo. In total, SONG holds an estimated market share of 7.4% in the United States, representing a whopping 2,500,000 works.
Look out for familiar artists like A$AP Rocky, Wiz Khalifa, and Young Jeezy in their impressive lineup. For more details on other notable artists, their press releases have a comprehensive list for you to explore.
Again if the whole idea of a Performance Rights Organization (PRO) feels confusing, you’re not alone. We did some digging to break it down for you.
What’s a Performance Rights Organization:
To keep it simple, think of a Performance Rights Organization (PRO) as the backstage manager for musicians. It’s like the middle person making sure that when your favorite songs are played in public—on the radio, at concerts, or even on your go-to streaming app—the artists get their fair share of the spotlight. These organizations, such as ASCAP, BMI, and SESAC, keep tabs on where and how music is being enjoyed and make sure the right people get paid for their tunes. It’s a behind-the-scenes gig that ensures artists get a nod and a paycheck every time their music takes center stage.
Latest Press Release:
This morning on November 10th, 2023, the company announced it will be cancelling 59.9% of their outstanding shares to enhancing Shareholder Value.
“Following the cancellation of an astounding 1,566,945,290 common stock shares, which reduced the total outstanding shares to 2,000,000,000, Mr. Noch is now embarking on yet another groundbreaking endeavor. He has pledged to cancel an additional 1,197,364,785 common stock shares, equating to a remarkable 59.9% of the current outstanding shares”.
Taking the cancellation of all these shares would also mean their market cap would be effected pretty drastically as well. If we do the math (at time of writing), 2B shares outstanding multiplied by the current stock price of $0.004 would mean ~8M market cap.
Okay Jake, so you’ve done the share reduction dance, claiming it’s a boost for shareholders. But really, what else does cutting down on shares mean for investors. Allow us to further break it down.
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Why Does it Matter?
Cutting down on the number of shares a company has floating around might seem like financial gymnastics, but it actually makes sense for a few reasons:
- More Bang for Your Buck (EPS): Picture this – you and your buddies own a pizza joint. If you slice up the pizza into more pieces, each one gets smaller. The same goes for shares. Less shares mean each piece of the company’s earnings pie goes to fewer shareholders, so everyone’s slice gets bigger. That’s what we call Earnings Per Share (EPS), and a bigger slice is usually good news.
- Share Price Perk: When a company trims down its shares, it can potentially give its stock price a boost because the float is now tighter. With a tighter float, it doesn’t take as much buying to move the stock price in either direction.
- Steady Ship: Fewer shares mean fewer folks holding the reins. It’s like steering a ship – with fewer hands on deck, it’s easier to keep things steady. Reducing the number of shares available for purchase also makes it harder and more costly for others to buy a big chunk of ownership, fortifying the company against hostile takeovers.
- Improved Financial Ratios: Reducing shares outstanding can even positively impact financial ratios, such as earnings per share, return on equity, and book value per share. These improvements of course make their financial profile more attractive to investors by and large.
Financial Highlights:
Despite having a market cap of around $15 million on YahooFinance, or $8 million if we consider the share consolidation, SONG has posted impressive numbers for its financials. They’ve managed to rake in a substantial $758 million in revenues, pushing a solid net income of $39 million. Their quarter ending in June, 2023 showed 93M in revenue, which was also net profitable too. Digging into their balance sheet, you’ll find $45 million in assets and a modest $61,000 in liabilities. Given those figures, this valuation’s definitely a head-scratcher and seems completely off.
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Behind SONG’s Low Valuation:
According to one user, @StockPicksNYC, on Twitter there’s a story behind why their valuation is so low given their fundamental financial backing.
Apparently the stock’s low valuation can be attributed to a previous incident where a storm-induced power outage at the CEO’s residence led the company to a downgrade on OTC markets, pushing SONG into ‘Expert Market‘ status with a ‘Shell Risk’ label.
Despite successfully addressing challenges to regain ‘Pink Current’ status and remove the ‘Shell Risk’ designation, SONG is still unable to update its information on the OTCM platform.
This is a well-documented problem with OTCM and there’s ongoing litigation with OTC Link, (an OTC Markets subsidiary), revolving around transparency and responsiveness issues during efforts to resolve downgrade-related issues.
This has now pushed SONG to take further measures to safeguard itself and its shareholders. They currently have a lawsuit filed against OTC Markets, where they’re pursuing $386.6 Million in Damages.
The good news is despite the lack of information on OTCM, SONG filed a Form 1-SA with the SEC to provide detailed information about their business.
OTC Expert Market:
If we look at the OTC Market tiers, there’s OTCQX, OTCQB, OTCPNK, OTC Expert Market, and OTC Grey. Back on September 28, 2021 the SEC put an amendment in place that stops brokers from quoting stocks without current information. That’s where OTC’s Expert Market steps in.
In a nut shell, any company that does not have current information publicly available trades on OTC Expert Market. Only broker-dealers, professionals or sophisticated investors are allowed to view quotations in Expert Market securities. It of course comes with massive risk given you’d be completely unaware of the company’s financial health.
Conclusion:
Among many factors, SONG’s impressive revenue and profits alone make the company appear considerably undervalued. Even without more developments, we can imagine a company of this caliber will inevitably draw increasing interest from investors. Considering the legal issues with OTC, a move to a bigger exchange like the NYSE or NASDAQ seems likely. They’d atleast be a great candidate considering the fundamentals. Keep in mind, this dynamic story could change at a moments notice, so be sure to keep them on your radar.
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Emerging Markets
Lucy Scientific Discovery’s (NASDAQ: LSDI) Game-Changing Move: A Closer Look at the High Times Acquisition
Published
1 year agoon
September 8, 2023On August 8th, 2023, Lucy Scientific Discovery Inc. (NASDAQ: LSDI), a leading developer in the psychedelic drug industry, witnessed an impressive surge in its stock value, gaining approximately 25% in combined trading, including after-hours (AH) trading. The British Columbia-based company made headlines by announcing its strategic move to acquire intellectual property (IP) from the renowned cannabis publication, High Times Holding Corp. (HHC).
Additional Background:
Under this agreement, Lucy will exchange 20% of its shares and a series of payments for access to HHC’s valuable IP portfolio, which includes the rights to generate licensing and royalty income from renowned brands like High Times, 420.com, and Cannabis Cup, along with their associated domain names.
The partnership between #HighTimes and #LucyScientificDiscovery just makes sense. It's a harmonious alignment that should lead to success. This could be the start of something special as they journey towards ambitious goals.$LSDI $TSLA $SPY pic.twitter.com/qgXYkKQVoe
— Luca Grayson (@GraysonLucasa) September 7, 2023
Lucy’s commitment involves making semi-annual payments to HHC over a five-year period, structured around earnings before income, taxes, depreciation, and amortization (EBITDA) generated through the acquired IP. The flexibility exists for Lucy to fulfill these payments either in cash or through stock issuance and the announcement is generating considerable interest.
Furthermore, post-acquisition, Lucy will grant High Times the opportunity to operate retail outlets and distribute THC products bearing these prestigious brands within the United States. This privilege comes in exchange for an annual license fee of $1 million, set to double to $2 million annually once federal legalization of cannabis occurs in the country.
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Leveraging the brand rights secured from HHC, Lucy aims to bolster its revenue streams by expanding and enhancing its existing 18 licensing agreements, both domestically and internationally. These arrangements encompass a wide array of consumer products and merchandise, promising to further establish Lucy’s presence in the global market. The acquisition is expected to be finalized within the coming two weeks, marking a significant strategic move for Lucy Scientific Discovery Inc.
As a result of the acquisition, High Times is now a publicly-traded entity. Lucy anticipates that this agreement will contribute over $10 million in revenue to its financial results in the upcoming year, along with $5 million in EBITDA.
By purchasing #HighTimes assets, Lucy Scientific Discovery has struck gold. It has acquired a wealth of intellectual property, trademarks, and royalty prospects that will bring #LSDI $LSDI #lucyscientificdiscovery millions of dollars. pic.twitter.com/CEkqQnuFHm
— Rowan Dune (@rowandune) September 7, 2023
Adam Levin, the Executive Chairman of HHC, expressed optimism about the deal, noting, “This transaction will create exciting new growth opportunities for the High Times brand, under the leadership of Richard Nanula, a seasoned executive with extensive experience in major consumer brands and global corporations.”
Levin also emphasized High Times’ enthusiasm in becoming a significant shareholder of Lucy Scientific Discovery. Notably, Lucy completed its initial public offering and Nasdaq listing in February, offering 1,875,000 shares at $4.00 each.
Richard Nanula, CEO of the British Columbia-based company, shared his outlook on the acquisition, stating, “Lucy expects this acquisition to rapidly generate high-margin revenue within the global cannabis sector.”
In recent developments, Lucy introduced the sleep aid product “Twilight,” which includes amanita muscaria and reishi mushrooms. Additionally, the company joined forces with Wesana Health Holdings Inc. (OTCQB: WSNAF) in March to collaborate on the development of the CBD and psilocybin-based drug SANA-013, targeting conditions such as migraines, cluster headaches, and major depressive disorder.
$LSDI's Health Canada license allows approved psilocybin sales, backed by the Canadian government's significant funding $LSDI is on fire. #LucyScientificDiscovery $LSDI
— William James (@jaym_willy) September 8, 2023
High Times, founded in 1974, has a rich history, featuring works by renowned writers like Truman Capote and Hunter S. Thompson. Since 1988, its Cannabis Cup has stood as the most prestigious cannabis competition globally, with notable judges including Snoop Dogg, Joe Rogan, Tommy Chong, and other prominent figures in the cannabis industry.
While Lucy’s shares showed a nearly 16% increase to reach $0.68 on the Nasdaq exchange on Friday, it is worth noting that they have experienced a decline of over 77% over the past year.
Macro Trend:
In recent times, our articles have prominently featured cannabis-related topics, reflecting the growing popularity of stocks in this sector. LSDI’s acquisition aligns perfectly with the current climate, as the cannabis industry experiences a significant surge, coinciding with the Health and Human Services (HHS) exploring the possibility of reclassifying cannabis from Schedule I to Schedule III of the Controlled Substances Act.
Don't overreact to temporary $LSDI EPS decline. Psychedelics mega-trend makes risk/reward compelling.#Shrooms#LucyScientificDiscovery
— gianna snell (@skatette) September 8, 2023
While many countries around the world have already moved towards decriminalization and legalization, the United States has been relatively cautious in its approach. However, the consideration of such a reclassification represents a potential historic turning point. If such a change were to materialize, it would mark a substantial shift in the regulatory landscape, potentially revitalizing cannabis as an attractive investment opportunity. The industry is already showing signs of reestablishing its market presence and could once again become a noteworthy investment option.
I know this Mindful line is set to disrupt the market. Expecting a surge in stock price in the months ahead. #Lucyscientificdiscovery $LSDI pic.twitter.com/2ccR1CttA3
— Tom (@Tomi_l33) September 7, 2023
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Disclosure: We have not been compensated for this article/video. MicroCap Daily is not an investment advisor; this article/video does not provide investment advice. Always do your research, make your own investment decisions, or consult with your nearest financial advisor. This article/video is not a solicitation or recommendation to buy, sell, or hold securities. This article/video is our opinion, is meant for informational and educational purposes only, and does not provide investment advice. Past performance is not indicative of future performance.
Picture by herbalhemp from Pixabay
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