FAT Brands Inc. (FAT) – Good Results Tempered by COVID Johnny Rockets to Impact Fourth Quarter

Thursday, November 12, 2020

FAT Brands Inc. (FAT)

Good Results Tempered by COVID; Johnny Rockets to Impact Fourth Quarter

FAT Brands Inc is a multi-brand restaurant franchising company. It develops, markets, and acquires predominantly fast casual restaurant concepts. The company provides turkey burgers, chicken Sandwiches, chicken tenders, burgers, ribs, wrap sandwiches, and others. Its brand portfolio comprises Fatburger, Buffalo’s Cafe and Express, and Ponderosa and Bonanza. The company’s overall footprint covers nearly 32 countries. Fatburger generates maximum revenue for the company.

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    3Q20 Results. Total revenue was $4.1 million, down from $6.5 million last year. Lower royalties and franchise fees were the key drivers. Net loss was $568,000, or $0.05 per share, compared to net income of $1.2 million, or $0.10 per share last year. We had forecast revenue of $3.6 million and a net loss of $1.6 million, or $0.11 per share.

    Sales Improving But Not Yet Back to Pre-Covid Levels.  Systemwide sales increased 53% sequentially, improving each month of the quarter, but the $73.1 million 3Q total was below the $84.7 million in the first quarter. Roughly 21% of the existing store count remains closed, mostly concentrated in the steak houses and Johnny Rockets. If COVID restrictions continue to ease, we expect the majority of …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Release – Newrange Gold (NRGOF) – Updates Drill Program at Pamlio Project

Newrange Gold Updates Drill Program at Pamlio Project

 

VANCOUVER, BRITISH COLUMBIA, November 12, 2020 (TSXV: NRG, US: NRGOF, Frankfurt: X6C) – Newrange Gold Corp. (“Newrange” or the “Company”) is pleased to provide an update on the reverse circulation (RC) drill program at the Pamlico Gold Project in Nevada. Since commencing the program in late May, the Company has drilled 65 holes (including two that had to be re-drilled) for a total of 6,538.04 meters. Assay results for the last 26 of these holes are still pending. Given this backlog of assays, the Company is taking a short hiatus in the drill program in order to compile the incoming results and plan a follow-up program.

Since switching rigs in September, drilling has been going well and the Company has drilled seven holes in each of the Gold Box Canyon and Merritt areas, eight at the Good Hope Mine, six at the Gold Bar and Pamlico Mines and two on IP anomalies.

The detailed location of upcoming holes, meters to be drilled and the relative amounts of RC versus diamond drilling will be determined once assay results have been interpreted. However, the Company expects to drill at least another 3,000 meters in approximately 20 holes that range in depth from 75 to 465 meters, following up on the recent drilling and with multiple holes planned to test the large Line 5 chargeability anomaly near the center of the property. It is anticipated that drilling will recommence on or about December 5.

About Pamlico

Located 12 miles southeast of Hawthorne, Nevada, along US Highway 95, the project enjoys excellent access and infrastructure, a mild, year-round operating climate and strong political support from Mineral County, one of the most pro-mining counties in the pro-mining state of Nevada. The Pamlico project covers the historic Pamlico group of mines, as well as the nearby Good Hope, Gold Bar and Sunset mines.

Discovered in 1884, the district rapidly gained a reputation as being one of Nevada’s highest-grade districts. Held by private interests for most of its history, the property remains underexplored in terms of modern exploration.

About Newrange Gold Corp.

Newrange is a precious metals exploration and development company focused on near to intermediate term production opportunities in favorable jurisdictions including Nevada, Ontario and Colorado. With numerous drill intercepts of near surface oxide gold mineralization to 340 grams gold per metric tonne, the Company’s flagship Pamlico Project is poised to become a significant new Nevada discovery. Focused on developing shareholder value through exploration and development of key projects, the Company is committed to building sustainable value for all stakeholders. Further information can be found on our website at www.newrangegold.com.

Signed: “Robert Archer”
CEO & Director

For further information contact:
Sharon Fleming
Corporate Communications
Phone: 760-898-9129
Email: info@newrangegold.com

Dave Cross
Chief Financial Officer and Corporate Secretary
Phone: 604-669-0868
Email: dcross@crossdavis.com

Website: www.newrangegold.com

Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statement: Some of the statements in this news release contain forward-looking information that involves inherent risk and uncertainty affecting the business of Newrange Gold Corp. Actual results may differ materially from those currently anticipated in such statements.

Release – Lineage Cell Therapeutics (LCTX) – Completes Patient Enrollment In Phase 1-2A Clinical Study Of Opregen Cell Therapy

 

Lineage Cell Therapeutics Completes Patient Enrollment In Phase 1/2a Clinical Study Of Opregen® Cell Therapy For The Treatment Of Dry Age-Related Macular Degeneration

 

  • OpRegen Data Update to be Featured in Presentation by Principal Investigator Christopher D. Riemann, M.D., at 2020 AAO Annual Meeting on November 15, 2020
  • Therapeutic Expert Call to Discuss Results Scheduled for November 17, 2020 @ 4pm ET/1pm PT

CARLSBAD, Calif.–(BUSINESS WIRE)–Nov. 11, 2020– Lineage Cell Therapeutics, Inc. (NYSE American and TASE: LCTX), a clinical-stage biotechnology company developing three novel cell therapies for serious conditions, today announced the successful completion of enrollment in its 24-patient Phase 1/2a study of its lead product candidate, OpRegen®. OpRegen is an investigational cell therapy consisting of retinal pigment epithelium (RPE) cells administered to the subretinal space for the treatment of dry age-related macular degeneration (AMD) with geographic atrophy (GA). Updated interim results from the ongoing Phase 1/2a study will be presented at the 2020 American Academy of Ophthalmology Annual Meeting (AAO 2020) during the OP02V Retina, Vitreous Original Papers Session on November 15, 2020 at 10:40am Eastern Time / 7:40 am Pacific Time by Christopher D. Riemann, M.D., Vitreoretinal Surgeon and Fellowship Director, Cincinnati Eye Institute and University of Cincinnati School of Medicine. Dr. Riemann also will participate in a call to discuss the interim results on November 17, 2020 at 4:00 pm Eastern Time / 1:00 pm Pacific Time. Interested parties can access the event on the Events and Presentations section of Lineage’s website.

“Completion of patient enrollment in our OpRegen study is a significant achievement for our team and reflects the focused commitment we have made to advancing our three cell therapy product candidates. We believe the potential for transplanted cells to safely and durably treat serious diseases and conditions, particularly where traditional molecular approaches have failed, will usher in a new treatment paradigm for modern medicine. Demonstrating this potential in clinical trials is a vital step in that process and we are thankful to have reached this important milestone,” stated Brian Culley, CEO. “As a result of increased awareness of our study and promising data we reported recently, including the first known demonstration of retinal tissue restoration in a clinical setting, we were able to enroll and treat the final five patients in cohort 4 in just five weeks. We also surpassed our original goal by utilizing the Gyroscope Orbit SDS in 7 of the last 9 patients. We extend our gratitude to the participating patients, their families, and the study investigators and coordinators in both the US and Israel. With this milestone reached, our focus turns toward collecting safety and efficacy data on the most recently treated patients, evaluating options for later-stage clinical development, including with potential partners, and approaching the FDA to discuss our next steps. Our objective is to position the OpRegen program as a front-runner in the race to address an unmet need in what is widely expected to be a multi-billion-dollar dry AMD therapeutic market.”

About OpRegen

OpRegen is currently being evaluated in a Phase 1/2a open-label, dose escalation safety and efficacy study of a single injection of human retinal pigment epithelium cells derived from an established pluripotent cell line and transplanted subretinally in patients with advanced dry AMD with GA. The study enrolled 24 patients into 4 cohorts. The first 3 cohorts enrolled only legally blind patients with best corrected visual acuity (BCVA) of 20/200 or worse. The fourth cohort enrolled patients with vision as high as 20/64. Cohort 4 also included patients treated with a new “thaw-and-inject” formulation of OpRegen, which can be shipped directly to sites and used immediately upon thawing, removing the complications and logistics of having to use a dose preparation facility. The primary objective of the study is to evaluate the safety and tolerability of OpRegen as assessed by the incidence and frequency of treatment emergent adverse events. Secondary objectives are to evaluate the preliminary efficacy of OpRegen treatment by assessing the changes in ophthalmological parameters measured by various methods of primary clinical relevance. Additionally, for the patients in Cohort 4 that receive subretinal delivery of OpRegen utilizing the Gyroscope Orbit Subretinal Delivery System (Gyroscope Orbit SDS), objectives will include the evaluation of the safety of delivery of OpRegen using the Gyroscope Orbit SDS.

Recently, Lineage reported the first known finding of retinal tissue regeneration in a patient receiving OpRegen for the treatment of atrophic dry AMD. This unprecedented finding supports the view that dry AMD is not an irreversible, degenerative condition and that some portion of diseased retinal tissue may be recoverable in atrophic end-stage disease patients. These findings were initially observed by an independent external advisor using multiple imaging technologies and were subsequently confirmed by the reading center and additional experts in the field of retinal imaging. The Company also has observed evidence of benefit in other patients, including increases in Best Corrected Visual Acuity (BCVA), reduction in the growth of GA, and increases in reading speed.

OpRegen is a registered trademark of Cell Cure Neurosciences Ltd., a majority-owned subsidiary of Lineage Cell Therapeutics, Inc.

About Dry AMD

Dry age-related macular degeneration (AMD) is a leading cause of adult blindness in the developed world. There are two forms of AMD: wet AMD and dry AMD. Dry AMD is the more common of the two types, accounting for approximately 85-90% of cases. Wet AMD is the less common of the two types, accounting for approximately 10-15% of cases. Global sales of the two leading wet AMD therapies were in excess of $10 billion in 2019. Nearly all cases of wet AMD begin as dry AMD. Dry AMD typically affects both eyes. There are currently no U.S. Food and Drug Administration (FDA) or European Medicines Agency (EMA) approved treatment options available for patients with dry AMD.

About Lineage Cell Therapeutics, Inc.

Lineage Cell Therapeutics is a clinical-stage biotechnology company developing novel cell therapies for unmet medical needs. Lineage’s programs are based on its robust proprietary cell-based therapy platform and associated in-house development and manufacturing capabilities. With this platform Lineage develops and manufactures specialized, terminally differentiated human cells from its pluripotent and progenitor cell starting materials. These differentiated cells are developed to either replace or support cells that are dysfunctional or absent due to degenerative disease or traumatic injury or administered as a means of helping the body mount an effective immune response to cancer. Lineage’s clinical programs are in markets with billion dollar opportunities and include three allogeneic (“off-the-shelf”) product candidates: (i) OpRegen®, a retinal pigment epithelium transplant therapy in Phase 1/2a development for the treatment of dry age-related macular degeneration, a leading cause of blindness in the developed world; (ii) OPC1, an oligodendrocyte progenitor cell therapy in Phase 1/2a development for the treatment of acute spinal cord injuries; and (iii) VAC, an allogeneic dendritic cell therapy platform for immuno-oncology and infectious disease, currently in clinical development for the treatment of non-small cell lung cancer. For more information, please visit www.lineagecell.com or follow the Company on Twitter @LineageCell.

Forward-Looking Statements

Lineage cautions you that all statements, other than statements of historical facts, contained in this press release, are forward-looking statements. Forward-looking statements, in some cases, can be identified by terms such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “design,” “intend,” “expect,” “could,” “plan,” “potential,” “predict,” “seek,” “should,” “would,” “contemplate,” project,” “target,” “tend to,” or the negative version of these words and similar expressions. Such statements include, but are not limited to, statements relating to the potential for cell therapy generally and the expected addressable market for OpRegen. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Lineage’s actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements in this press release, including risks and uncertainties inherent in Lineage’s business and other risks in Lineage’s filings with the Securities and Exchange Commission (the SEC). Lineage’s forward-looking statements are based upon its current expectations and involve assumptions that may never materialize or may prove to be incorrect. All forward-looking statements are expressly qualified in their entirety by these cautionary statements. Further information regarding these and other risks is included under the heading “Risk Factors” in Lineage’s periodic reports with the SEC, including Lineage’s Annual Report on Form 10-K filed with the SEC on March 12, 2020 and its other reports, which are available from the SEC’s website. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they were made. Lineage undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.

Lineage Cell Therapeutics, Inc. IR
Ioana C. Hone
(ir@lineagecell.com)
(442) 287-8963

Solebury Trout IR
Gitanjali Jain Ogawa
(Gogawa@troutgroup.com)
(646) 378-2949

Russo Partners – Media Relations
Nic Johnson or David Schull
Nic.johnson@russopartnersllc.com
David.schull@russopartnersllc.com
(212) 845-4242

Source: Lineage Cell Therapeutics, Inc.

Release – Lineage Cell Therapeutics (LCTX) – Video – Utilizing Pluripotent Stem Cells In Cell Therapy

 

Utilizing pluripotent stem cells in cell therapy

 

In this episode of Conversations in Healthcare, Mike Ward, Global Head of Thought Leadership at DRG, speaks with Brian Culley, CEO of Lineage Cell Therapeutics. Brian and Mike discuss the company’s cell therapy program, utilizing pluripotent stem cells, initially targeting dry age-related macular degeneration, acute spinal cord injuries, and non-small cell lung cancer. Brian shares about the status of their Phase 1/2a clinical trials, and how COVID-19 has affected the company’s operations. Learn more in the full episode.

 

 

Will There be Mergers in the Utility Industry?

 

Utility Mergers May Be Reheating After Pausing for the Pandemic

 

NextEra Energy (NEE) made an all-stock acquisition offer for Evergy (EVRG) earlier this week. It has been reported that Evergy quickly dismissed the $60 per share offer as inadequate. The offer comes after NextEra, the world’s largest wind and solar power producer, was rebuffed in its attempt to acquire Evergy last spring and Duke Energy (DUK) in September. Evergy is under pressure from one of its shareholders, Elliot Management, to consider consolidation.

Merger activity was picking up before the pandemic – Utility merger activity had been increasing steadily between 2012-2016.  Activity remained at a fervid pace in recent years. In 2017 Sempra Energy (SRE) acquired Oncor, the regulated utility unit of TXU. In 2018, Great Plains Energy and Westar Energy merged to form Evergy, Inc. In 2019 Dominion Energy (D) closed its acquisition of SCANA, and Centerpoint Energy (CNP) absorbed Vectren. This year, however, has largely been characterized by merger offers but no agreements.

 

 

Merger agreements among regulated assets are difficult to justify – Under cost-of-service rate-making, utility rates are set to recover costs and leave a little leftover to compensate investors. Cost reductions through a merger or other means often face a reduction in rates. Consequently, it is difficult to pay a market premium without it being highly dilutive to earnings without cost savings. Combining noncontiguous service areas limits cost reductions beyond headquarter reductions. Merger savings must come from unregulated operations. Hostile takeovers among utilities are extremely rare because they require regulatory approval. NextEra CEO James Robo said on September 30, 2020, that he would not pursue hostile acquisitions because major deals could only clear regulatory hurdles if companies worked co-operatively.

History of utility mergers – In the nineties, there was a wave of merger activity among utilities. Mergers typically took the form of a large electric utility taking over its neighboring smaller gas utility. The thought process was that the company that owned the meter rights owned the customer. At the time, there was a belief that utilities could use that connection to sell customers unregulated products. Products such as appliance repair service agreements had become popular. In addition, natural gas service was becoming unbundled, allowing customers the ability to buy gas from a third party and then pay the utility solely for the distribution service. Utilities began forming their own unregulated marketing subsidiaries, often with names similar to the regulated utility name. Utilities needed to acquire, merge, or sell out to control enough metered customers to compete. Over time, regulators tightened the rules regarding the sale of unregulated services to utility customers.

Why has merger activity increased? Around the turn of the century, electric utility service also started to become unbundled. Large customers could purchase power from marketers or even self-generate via cogenerations. The shift away from traditional utility operations has continued with the spread of renewable power generation. Utilities like NextEra that have focused on wind generation have seen their stock price soar while utilities stuck with stranded coal generation assets have seen their stock underperform. That has given currency to the winners in the form of a high stock price.

Will merger activity reignite? COVID-19 and the resulting shutdown of the economy have made acquisitions difficult in all industries. Having a good sense of the true cash flow of an asset to acquire is difficult during normal situations and close to impossible under current situations. The fact that companies are even considering making an acquisition is a clear sign that the appetite for acquiring is there. As pandemic concerns began to wane with signs of a possible vaccine, it is reasonable to think that merger activity will pick up again. We look for 2021 to be a busy year for utilities.

 

Suggested Reading:

Will Solar Panels Continue to be Subsidized?

Will M&A Activity Spread to Canada?

Mergers Within the energy Industry are Heating Up

 

Each event in our popular Virtual Road Shows Series has a maximum capacity of 100 investors online. To take part, listen to and perhaps get your questions answered, see which virtual investor meeting intrigues you here.

 

Sources:

https://www.forbes.com/sites/greatspeculations/2020/06/21/evergy-inc-the-latest-phase-of-utility-ma/?sh=2c34d7374671, Roger Conrad, Forbes, June 21, 2020

https://www.utilitydive.com/news/nextera-mulls-bid-for-evergy-amid-market-volatility-may-face-competing-off/575675/, Iulia Gheorghiu, Utility Dive, April 8, 2020

https://www.reuters.com/article/us-evergy-m-a-nextera-energy-exclusive/exclusive-nextera-energy-in-15-billion-bid-for-evergy-sources-idUSKBN27P2S8, David French, Reuters, November 9, 2020

Photo: Skyspecs

 

Strong Third Quarter Performance is Encouraging for Future Performance

 

How High Above Expectations are Third-Quarter Earnings?

 

Company performance last quarter was strong, well above expectations. With 89% of the companies in the S&P 500 having released September-quarter earnings, an impressive 86% have reported a positive earnings surprise as announced by Factset. If this percent holds, it will be the highest percentage of S&P 500 companies reporting a positive EPS surprise since FactSet began tracking this metric in 2008. On average, earnings are beating estimates by 2.6% The outperformance most likely represents conservative guidance by management and estimates by analysts following the pandemic-depressed second quarter. These concerns have eased but have not gone away. Are the quarter’s results a sign that things are better than expected (optimism), or are there enough cracks to point out growing economic and political concern (pessimistic)?

Optimistic Arguments

  • The percent reporting positive surprises is higher than normal and widespread.  It is not unusual for more companies to report positive earnings surprises than earnings disappointments.  Historically, about 65% of the companies report results above expectations.  However, 86% is high. What’s more, the outperformance is widespread. All eleven sectors reported better-than-expected EPS, on average. In the case of Consumer Staples, Health Care, Industrials, and Materials, more than 90% of the companies are reporting results above expectations.
  • The level of outperformance is high and supported by top-line growth. On average, earnings are beating estimates by 2.6%. If this holds, it will be the largest outperformance since FactSet began tracking performance in 2008. Seventy-nine percent of the S&P 500 companies reported revenue growth above estimates. Like earnings, the percent reporting a favorable revenue surprise would be a record.
  • Earnings momentum looks like it will continue into the fourth quarter. Of the companies giving guidance, 68% reported positive EPS guidance for the upcoming quarter. Analysts have followed management guidance. The median analyst estimate for the fourth quarter rose 1.8% during the month of October. The increase comes after sharp estimate decreases in the second quarter. The increase contrasts with previous periods. Over the last ten years, analysts have reduced their estimates by 2.2%, on average, in the first month after quarter’s end.

Pessimistic Arguments

  • Results may be an upside surprise, but they are down year-over-year.  For the companies reporting, earnings are down 7.5% versus last year, on average.  If this decline holds after all companies have reported, it will represent the sixth quarter of the last seven to report year-over-year declines.
  • Strong earnings reflect an economic recovery from pandemic restrictions, and the pandemic is worsening. As the number of reported COVID-19 cases have been trending higher, government officials are beginning to consider reimposing activity restrictions. Already, several governments in Europe have added restrictions, and the Biden transition team has hinted it would as well.
  • Valuations are still high. The forward 12-month P/E ratio is 21.6. This ratio is above the ten-year average of 15.5 times. The average price target is only 11% above current stock prices. High valuations leave less room for stocks to perform well unless results continue to come in better than expected.

On Balance

The market looks well beyond near-term results, and it will be company performance over the next several years that will impact future stock price performance. That said, strong results this quarter are a good harbinger of future performance. This quarter’s results are encouraging and seem to indicate that management and analysts have overestimated the individual company impact of broader economic and political concerns.

Suggested Reading:

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Keeping Their Powder Dry

 

Do You Know a College Student?

Tell them about the College Challenge!

 

Sources:

https://www.factset.com/hubfs/Resources%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_110620A.pdf, John Butters, FactSet, November 6, 2020

Vectrus (VEC) – After a 3Q Beat, What’s Next?

Wednesday, November 11, 2020

Vectrus (VEC)

After a 3Q Beat, What’s Next?

Vectrus Inc is a U.S.-based company that provides services to the U.S. government. It operates as one segment and offer facility and logistics services and information technology and network communications services. The information technology and network communications capabilities consist of communications systems operations and maintenance, management and service support, systems installation and activation, system-of-systems engineering and software development, and mission support for the department of defense. The facility and logistics service include airfield management, ammunition management, civil engineering, communications, emergency services, life support activities, public works, security, transportation operations and others.

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    3Q20 Results. Vectrus continued to post strong results even in the face of COVID. Revenue of $352.4 million was down 2.1% y-o-y, but up 4.9% sequentially. COVID impacts reduced 3Q revenue by an estimated $12.9 million. EBITDA margin of 4.8% was the second highest in 10 quarters, even with a 40 bp COVID headwind. GAAP EPS was $0.88 versus $0.67. Adjusted EPS was $0.89 versus $0.71 last year. Third quarter 2020 adjusted EPS was impacted by $0.14 from COVID.

    Converging on the $2.5B/7% Goal.  Vectrus continues to move forward on its goal of $2.5 billion of revenue and 7% EBITDA margin by 2023. The new contracts highlight the Company’s move to diversify its revenue streams, while moving up the margin ladder. The Company is exhibiting its leadership position in the converged infrastructure market, in our view, which should lead to additional opportunities …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Palladium One Mining Inc. (NKORF)(PDM:CA) – Building Scale at the Palladium-Dominant LK Project

Wednesday, November 11, 2020

Palladium One Mining Inc. (NKORF)(PDM:CA)

Building Scale at the Palladium-Dominant LK Project

Noble Capital Markets research on Palladium One Mining is published under ticker symbols (NKORF and PDM:CA). The price target is in USD and based on ticker symbol NKORF. Palladium One Mining Inc is a palladium dominant, PGE, nickel, copper exploration and development company. Its assets consist of the Lantinen Koillismaa and Kostonjarvi PGE-Cu-Ni projects, located in north-central Finland and the Tyko Ni-Cu-PGE and Disraeli PGE-Ni-Cu properties in Ontario, Canada. LK is targeting disseminated sulphide along 38 kilometers of favorable basal contact. The KS project is targeting massive sulphide within a 20,000-hectare land package covering a regional scale gravity and magnetic geophysical anomaly. Tyko is a 13,000-hectare project targeting disseminated and massive sulphide in a highly metamorphosed Archean terrain. Disraeli is a 2,500-hectare project targeting PGE-rich disseminated and massive sulphide in a highly productive Proterozoic mid-continent rift.

Mark Reichman, Senior Research Analyst of Natural Resources, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    Phase II drilling program begins this week. Palladium One announced plans to begin a 17,500-meter Phase II drilling program on November 13 at its Lantinen Koillismaa (LK) project in Finland. The Phase II program is designed to support a future inferred resource estimate at the Kaukua South Zone, which has a drill defined mineralized strike length greater than 4 kilometers, and better define open-pit resources. The Phase I program, completed in September, entailed drilling 26 holes representing 4,486 meters of drilling.

    Initial focus will be on a wide zone of shallow high-grade mineralization.  The initial stage of the Phase II program will entail approximately 2,500 meters of diamond drilling to be completed before year-end and will target a 750-meter long high-grade section located between Holes LK20-006 and LK20-016. Of the discovery holes drilled at Kaukua South, bore hole LK20-016 is the highest grade drilled …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Gevo Inc. (GEVO) – 3Q2020 Capital Raises Enhance Funding Visibility and Project Financing Discussions Progressing

Wednesday, November 11, 2020

Gevo, Inc. (GEVO)

3Q2020 Capital Raises Enhance Funding Visibility and Project Financing Discussions Progressing

Gevo Inc is a renewable chemicals and biofuels company engaged in the development and commercialization of alternatives to petroleum-based products based on isobutanol produced from renewable feedstocks. Its operating segments are the Gevo segment and the Gevo Development/Agri-Energy segment. By its segments, it is involved in research and development activities related to the future production of isobutanol, including the development of its biocatalysts, the production and sale of biojet fuel, its Retrofit process and the next generation of chemicals and biofuels that will be based on its isobutanol technology. Gevo Development/Agri-Energy is the key revenue generating segment which involves the operation of the Luverne Facility and production of ethanol, isobutanol and related products.

Poe Fratt, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    Adjusted 3Q2020 EBITDA of $(4.0) million widened versus $(3.1) million in 2Q2020 due to idling Luverne plant, but cash burn dropped. Lower cost structure pushed cash burn down to $3.9 million from $4.7 million. Current 2020 EBITDA loss estimate is $16.7 million and 4Q2020 cash burn should stay in the $4 million range.

    Current cash of ~$81 million enhances near-term funding visibility, including repayment of maturing convertible debt.  3Q2020 capital raises of $62 million from equity offerings and $16 million from warrant exercises enhanced the funding visibility and reduced financial risk. Design and engineering (FEED) phase to fully develop/construct the three production plants has started and the influx of cash …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

ACCO Brands Corporation (ACCO) – PowerA Acquisition Expands Consumer Offerings

Wednesday, November 11, 2020

ACCO Brands Corporation (ACCO)

PowerA Acquisition Expands Consumer Offerings

ACCO Brands Corporation designs, manufactures, sources, markets, and sells office products, academic supplies, and calendar products primarily in the United States, Canada, Northern Europe, Brazil, Australia, and Mexico. It operates through three segments: ACCO Brands North America, ACCO Brands EMEA, and ACCO Brands International. The company offers office products, such as stapling, binding and laminating equipment, and related consumable supplies, as well as shredders and whiteboards; and academic products, including notebooks, folders, decorative calendars, and stationery products. It also provides private label products, as well as business machine maintenance and repair services. The company offers its business, academic, and calendar product lines under the Artline, AT-A-GLANCE, Derwent, Esselte, Five Star, GBC, Hilroy, Leitz, Marbig, Mead, NOBO, Quartet, Rapid, Rexel, Swingline, Tilibra, Wilson Jones, and other brand names. In addition, it designs, sources, distributes, markets, and sells accessories for laptop and desktop computers, and tablets comprising security products; input devices, such as presenters, mice, and trackballs; ergonomic aids, including foot and wrist rests; docking stations; and other personal computers and tablet accessories under the Kensington, Microsaver, and ClickSafe brand names. The company sells its products to consumers and commercial end-users primarily through resellers, including traditional office supply resellers, wholesalers, mass merchandisers, and retailers, as well as directly to consumers through on-line and direct mail. ACCO Brands Corporation is headquartered in Lake Zurich, Illinois.

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    PowerA Acquisition. Last night, ACCO announced it has entered into a definitive agreement to acquire PowerA, a fast-growing, leading provider of third-party video gaming accessories, including controllers, power charging solutions, and gaming headsets. PowerA is a long-standing licensed partner with the leading gaming platforms and title publishers, with a 20-year track record of collaboration.

    Consumer Focus.  The acquisition represents a major step in ACCO’s strategy to transition the Company into a faster-growing, consumer-focused company. Upon completion of the deal, more than 50% of revenues will be derived from consumer, school, and technology products, which will offer faster growing market demand over the next several years. ACCO’s channels will become more consumer and online …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Sierra Metals (SMTS)(SMT:CA) – Big 3Q Beat; Raising Estimates

Tuesday, November 10, 2020

Sierra Metals (SMTS)(SMT:CA)

Big 3Q Beat; Raising Estimates

As of April 24, 2020, Noble Capital Markets research on Sierra Metals is published under ticker symbols (SMTS and SMT:CA). The price target is in USD and based on ticker symbol SMTS. Research reports dated prior to April 24, 2020 may not follow these guidelines and could account for a variance in the price target.

Sierra Metals Inc is a precious and base metals producer in Latin America. The company acquires, explores, extracts, and produces mineral concentrates consisting of silver, copper, lead, zinc and gold in Mexico and Peru. Its activity includes the operation of the Yauricocha Mine in Peru, and the Bolivar and Cusi mines in Mexico. Yauricocha is an underground polymetallic mine using the sublevel block caving and cut-and-fill mining methods. Bolivar is a copper-silver-zinc-gold underground mine using room-and-pillar mining method. The majority of the revenue is earned by selling of the mineral concentrates to its customers in Peru.

Mark Reichman, Senior Research Analyst of Natural Resources, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    Better-than-expected third quarter earnings. Sierra Metals reported adjusted earnings per share of $0.11 compared with $0.02 during the prior year period and our estimate of $0.06. The variance to our estimate was largely due to lower-than-expected operating costs. Compared with the prior year period, mining costs declined 18.3% and gross profit as a percent of revenue increased to 45.1% from 28.4%. Adjusted EBITDA increased 72.5% to $37.2 million compared to $21.6 million earned during the prior year. During the third quarter, free cash flow amounted to $24.0 million. Despite a challenging operating environment due to COVID, SMTS delivered exceptional operating and financial results.

    Updating estimates.  We are increasing our 2020 EPS and EBITDA estimates to $0.21 and $102.9 million from $0.14 and $85.5 million, respectively. Additionally, we have increased our 2021 EPS and EBITDA estimates to $0.38 and $172.7 million from $0.30 and $137.3 million. Our estimate revisions reflect lower costs and higher margin …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Townsquare Media Inc (TSQ) – An Impressive Recovery; Raising Estimates

Tuesday, November 10, 2020

Townsquare Media Inc (TSQ)

An Impressive Recovery; Raising Estimates

Townsquare Media Inc is an entertainment and media company offering digital marketing solutions in the United States and Canada. It owns and operates radio stations, social media properties focusing the small and mid-cap companies. Services offered to the clients include live events, local advertising, digital advertising, e-commerce offerings, few others. The segments through which the company operates its businesses are classified into Local marketing solutions and Entertainment segments. Revenues are generated from commercials through broadcasts and sale of internet based advertisements.

Michael Kupinski, Director of Research, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    Outperforms highest expectations. Q3 revenues of $95.3 million was better than our recent upwardly revised revenue estimate of $92.1 million. Cash flow, as measured by adj. EBITDA, was $17.5 million, significantly better than our $11.3 million estimate. The results benefited from a large $4.4 million in Political advertising, above our upwardly revised $2.6 million estimate, and accounted for the large variance in our estimates.

    Improving results, even without Political.  Revenue trends appear to be moderating even without the benefit of Political advertising. Q4 advertising pacings are down 17%, a sequential improvement from the 21% decline in q3, ex Political. Its Digital Interactive business continues its double-digit revenue growth in Q4, up an expected 16%, a sequential acceleration from 14% growth in Q3 …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Information Services (III) – Beats 3Q Expectations, Continues to Move Forward in a COVID World

Tuesday, November 10, 2020

Information Services (III)

Beats 3Q Expectations, Continues to Move Forward in a COVID World

ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 700 clients, including more than 70 of the top 100 enterprises in the world, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,300 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    3Q20 Operating Results. Third quarter results came in better than expected, with revenue of $61.6 million and adjusted EBITDA of $8.2 million. Management had forecast revenue in the $53-$55 million range and adjusted EBITDA in the $6-$7 million range. EPS for the quarter was $0.04 and adjusted EPS was $0.10. We had forecast revenue of $53 million, adjusted EBITDA of $6.8 million, EPS of $0.01, and $0.05 per share of adjusted EPS.

    Geographies.  Revenues were $35.0 million in the Americas, up 11% sequentially and down 13% versus the prior year; $20.9 million in Europe, flat sequentially and down 7% on a reported basis (down 11% in constant currency) versus the prior year; and $5.7 million in Asia Pacific, up 19% sequentially and up 8% on a reported basis (and up 4% in constant currency) versus the prior year. Recurring …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision.