Joe Gomes, Managing Director – Generalist Analyst, Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Investor Conference. Late last week, Commercial Vehicle Group’s (CVG) CEO Harold Bevis and CFO Andy Cheung presented at an investor conference. As we highlighted in our initiation report, CVG is in the midst of a business transformation and management provided an overview of the current status.
Contract Wins. Over the past two years, CVG has won over $400 million of annualized new business at full ramp. CVG won over 300 programs with 115 new and existing customers in 18 countries in 19 different markets. New business should contribute over $150 million of revenue in 2023.
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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.
In 2022, central banks purchased the largest amount of gold in recent history. According to the World Gold Council, central bank purchases of gold have reached a level not seen since 1967. The world’s central banks bought 673 metric tons in one month, and in the third quarter, the figure reached 400 metric tons. This is interesting because the flow from central banks since 2020 has been eminently net sales.
Why are global central banks adding gold to their reserves? There may be different factors.
Most central banks’ largest percentage of reserves are US dollars, which usually come in the form of US Treasury bonds. It would make sense for some of the central banks, especially China, to decide to depend less on the dollar.
China’s high foreign exchange reserves are a key source of stability for the People’s Bank of China. But the high amount of US dollars ($3.1 trillion) may have been a key stabilizing factor in 2022, but it could be too much if the next ten years bring a wave of money devaluation that has never happened before.
Central banks have been talking about the idea of issuing a digital currency, which would completely change the way money works today. By issuing a digital currency directly into a citizen’s account at the central bank, the financial institution would have all access to savers’ information and, more importantly, would be able to accelerate the transmission mechanism of monetary policy by eliminating the channels that prevent higher inflation from happening: the banking channel and the backstop of credit demand. What has kept inflation from going up much more is that the way monetary policy is passed on is always slowed down by the demand for credit in the banking system. This has obviously led to a huge rise in the prices of financial assets and still caused prices to go through the roof when the growth in the money supply was used to pay for government spending and subsidies.
If central banks start issuing digital currencies, the level of purchasing power destruction of currencies seen in the past fifty years will be exceedingly small compared with what can occur with unbridled central bank control.
In such an environment, gold’s status as a reserve of value would be unequalled.
There are more reasons why a central bank might buy gold.
Central banks need gold because they may be preparing for an unprecedented period of monetary devastation.
The Financial Times claims that central banks are already suffering significant losses as a result of the falling value of the bonds they hold on their balance sheets. By the end of the second quarter of 2022, the Federal Reserve had lost $720 billion while the Bank of England had lost £200 billion. The European Central Bank is currently having its finances reviewed, and it is predicted that it will also incur significant losses. The European Central Bank, the US Federal Reserve, the Bank of England, the Swiss National Bank, and the Australian central bank all “now face possible losses of more than $1 trillion altogether, as once-profitable bonds morph into liabilities,” according to Reuters.
If a central bank experiences a loss, it can fill the gap by using any available reserves from prior years or by requesting help from other central banks. Similar to a commercial bank, it may experience significant difficulties; nevertheless, a central bank has the option of turning to governments as a last resort. This implies that the hole will be paid for by taxpayers, and the costs are astronomical.
The wave of monetary destruction that could result from a new record in global debt, enormous losses in the central bank’s assets, and the issuance of digital currencies finds only one true safe haven with centuries of proven status as a reserve of value: Gold. This is because central banks are aware that governments are not cutting deficit spending.
These numbers highlight the enormous issue brought on by the recent overuse of quantitative easing. Because they were unaware of the reality of issuer solvency, central banks switched from purchasing low-risk assets at attractive prices to purchasing any sovereign bond at any price.
Why do central banks increase their gold purchases just as losses appear on their balance sheets? To increase their reserve level, lessen losses, and foresee how newly created digital currencies may affect inflation. Since buying European or North American sovereign bonds doesn’t lower the risk of losing money if inflation stays high, it is very likely that the only real option if to buy more gold.
The central banks of industrialized nations will make an effort to shrink their balance sheets in order to fight inflation, but they will also discover that the assets they own are continuing to depreciate in value. A central bank that is losing money cannot immediately expand its balance sheet or buy more sovereign bonds. A liquidity trap has been set. Quantitative easing and low interest rates are necessary for higher asset values, but further liquidity and financial restraint may prolong inflationary pressures, which would then increase pressure on asset prices.
The idea that printing money wouldn’t lead to inflation served as the foundation for the monetary mirage. The evidence to the contrary now demonstrates that central banks are faced with a serious challenge: they are unable to sustain multiple expansion and asset price inflation, lower consumer prices, and fund government deficit spending at the same time.
So, why do they buy gold? Because a new paradigm in policy will unavoidably emerge as a result of the disastrous economic and monetary effects of years of excessive easing, and neither our real earnings nor our deposit savings benefit from that. When given the choice between “sound money” and “financial repression,” governments have forced central banks to choose “financial repression.”
The only reason central banks buy gold is to protect their balance sheets from their own monetary destruction programs; they have no choice but to do so.
About the Author:
Daniel Lacalle, Ph.D., economist and fund manager, is the author of the bestselling books Freedom or Equality (2020), Escape from the Central Bank Trap (2017), The Energy World Is Flat (2015), and Life in the Financial Markets (2014).
Daniel is a professor of global economy at IE Business School in Madrid.
Small-Cap Companies are Punching Back on Naked Shorts in Growing Numbers
The hashtag #NakedShorts has been trending on Twitter for over a week. To save Channelchek readers any embarrassment that may occur from Googling this term, especially at work, below are specifics on this market jargon. Also included below are specifics on why this has been trending and how it may impact self-directed retail traders and even small publicly traded companies that have the potential to be impacted by an illegal practice that apparently is not uncommon.
What are Naked Shorts?
Naked short selling of stocks is the illegal practice of short-selling shares that have not been allocated and verified to exist. Most shorting of stock occurs only after the trader borrows the security or determines that it can be borrowed before they sell it short (without owning). So naked shorting refers to short pressure on a stock that may actually be larger than the tradable shares in the market. This can place downward pressure on shares as they are sold, at times in excess of their existence.
Despite being made illegal after the 2008–09 financial crisis, naked shorting continues in practice because of loopholes in rules and discrepancies between physical and electronic trading systems.
Small Caps Revenge
Empowered by the activities of Gamestop (GME) and others, a growing number of small-cap companies are devising plans to go after naked short sellers. This could help their companies trade at a fairer value rather than be artificially depressed by illegal trading practices.
Companies involved in heightening integrity in the markets for their stock are companies like Verb Technology Co. Inc. (VERB), a provider of interactive video-based sales apps with operations in Newport, California, and Lehi, Utah. Verb said this week it was joining education company Genius Group Ltd. (GNS), e-scooter and e-bike maker Helbiz (HLBZ), and Creatd Inc. (CRTD) designed for creators in coming up with measures to ensure “greater integrity in the capital markets” as Verb Chief Executive Rory J. Cutai said in a statement.
The move gained impetus last week as Genius Group said it had appointed a former F.B.I. director to lead a task force investigating alleged illegal trading in its stock, first disclosed a few weeks ago. Genius CEO believes there has been a measurable cost to the company. “We want this to stop,” he said. “They’re taking value away from our shareholders. They’re predators. They’re doing something illegal, and we want it to stop, whether that means getting regulators to enforce existing regulations or put new ones in place,” he said.
Legality of Naked Short Selling
In regular (legal) short trading, an investor borrows shares from someone else and pays an interest rate or “rebate rate.” They then sell them in anticipation of the stock price falling. The trade is a winner if the price falls and the seller buys them back at a lower price (netting out rebate rate) to close out the open short sale.
In naked short selling, investors don’t borrow the stock. They skip right to selling unowned with a promise to deliver them at a later date. If that promise is not fulfilled, it’s a failure to deliver.
Recently, companies such as AMC have paid a special dividend to determine, and frankly hurt, those short sellers that have not abided by the rules by first borrowing the security it sold.
Image: Elon Musk has been very vocal, Tesla is a company that hedge fund managers have routinely shorted (Twitter)
What Some Companies are Doing
Last week Helbiz said it was going to punch back at naked short positions. Creatd CEO Jeremy Frommer, meanwhile, is behind Ceobloc, a website that aims to end the practice of naked short selling. “Illegal naked short selling is the biggest risk to the health of today’s public markets” is how the site introduces its mission.
Genius just set guidance for 2023, saying it expects revenue of $48 million to $52 million, up 37% from its 2022 pro forma guidance. Last Thursday, the stock rose a record 290% in volume of about 270 million shares traded. That crushed the daily average of about 634,000. The CEO says this is another indicator of wrongdoing, given that the company’s float is just 10.9 million shares. “Clearly, that’s far more shares than we created,” the founder, Roger Hamilton points out.
Take Away
It is unclear what the task force of the small-cap companies intends to do. Companies like AMC Theaters (AMC) waged war by declaring a dividend that was a different class of stock. Shareholders would have to verify their ownership of a registered share in order to receive the dividend. This went a long way to verify what is in the float that is legitimate and that which is not.
With a Light Week Ahead for Economic Reports, Investors Eye Big-Tech Earnings
In contrast to recent weeks, which began quietly as investors waited on late-week releases (i.e.: inflation, Beige Book, Fed announcements, etc.) before getting involved, this week is relatively quiet for economic reports. With less to be concerned about undermining any new positions, early week activity, without a holiday, may help increase volume. The scarcity of economic numbers could also cause more attention to be paid to earnings reports. This coming week we’ll receive a slew of big tech companies reporting. Disappointment may cause tech, which is showing signs of life early in 2023, to fall behind again. Whereas surprises on the upside could help unwind some of last year’s dismal big tech performance. Small Cap stocks, for their part, are keeping pace with the Nasdaq 100 mega stocks.
Earnings of both small-caps and mega-caps this week may produce a clear front-running segment based on capitalization.
There’s a Fed meeting next week. While the consensus seems to be for a 25 bp hike, Fed governors have been clear in recent addresses that the tightening cycle is not over. The PCE number late this week is considered the Fed’s favorite inflation gauge. There are no scheduled addresses by Fed regional presidents leading up to the two-day meeting that concludes on February 1.
Monday 1/23
8:30 AM ET The index of leading economic indicators, which has been in steep decline (dropped a full 1.0 percent in November), is expected to have fallen a further 0.7 percent in December. The index of leading economic indicators is a composite of 10 forward-looking components, including building permits, new factory orders, stock market performance, and unemployment claims. As such, estimates pre-report tend to be very close to the actual number. The report attempts to predict general economic conditions six months out.
Tuesday 1/24
9:45 AM ET, The Purchasing Managers Index (PMI) has been drifting down further into contraction – no relief is expected for January. Manufacturing is seen at 46.5 with services at 45.5.
Wednesday 1/25
7:00 AM ET, the Mortgage Bankers’ Association (MBA) compiles various mortgage loan indexes. The purchase applications index measures applications at mortgage lenders. This is a leading indicator for single-family home sales and housing construction. The composite index is expected to come in at 27.9%, while the Purchase applications are expected to show a reading of 24.7%. The data provides a gauge of not only the demand for housing but economic momentum.
Thursday 1/26
8:30 AM ET, Forecasters see Durable Goods Orders rebounding 2.8 percent in December, which would more than reverse November’s steep 2.1 percent decline. Yet the gain is seen concentrated in aircraft as both ex-transportation and core capital goods orders are seen falling 0.2 percent.
8:30 AM ET, Gross Domestic Product, or GDP for the fourth quarter is expected to have slowed to a 2.7% annualized growth versus third-quarter growth of 3.2%. Positive growth would indicate that the economy is not in a recession.
8:30 AM ET, Jobless Claims are a weekly report. For the January 21 week, it is expected to come in at 202,000 versus a very low 190,000 in the prior week. The Fed focuses on jobs; the very strong numbers (low) suggest the Fed has room to tighten without being overly disruptive to job creation. Also, a tight labor market can be viewed as inflationary.
10:00 AM ET, New Home Sales in December are expected to revert to the downward trend at a 614,000 annualized rate versus November’s 640,000. Higher home sales reverberate throughout the economy in terms of spending and growth.
Friday 1/27
• 8:30 AM ET, Personal Income is expected to have increased a monthly 0.2 percent higher in December, with consumption expenditures expected to have decreased 0.1 percent. These would compare with respective November gains of 0.4 and 0.1 percent.
The PCE inflation readings for December, which are part of the PI numbers, are expected to show no change overall and up 0.3 percent for the core (versus respective gains of 0.1 and 0.2 percent) for annual rates of 5.0 and 4.4 percent (versus November’s 5.5 and 4.7 percent).
What Else
The Federal Reserve is very likely through most of its overnight Fed Funds tightening cycle. Japan, which had gone through decades of having a deflation problem, is now experiencing the highest inflation in 41 years. The Bank of Japan has not adopted the aggressively hawkish monetary policy that the US has. The US central bank, chaired by Jerome Powell, must be looking on and holding his stated opinion that he’d rather do too much tightening than too little.
Vancouver, British Columbia – January 20, 2023: Defense Metals Corp. (“Defense Metals” or the “Company”; TSX-V: DEFN / OTCQB: DFMTF / FSE:35D) is pleased to announce that it will participate at both, the AME Roundup in the Core shack, Booth# 821, January 25, & 26th, 2023 and the Vancouver Resource Investment Conference, Booth #119, on January 29-30, 2023. Defense Metals’ technical and financial management will be available during the conferences at the Vancouver Convention Centre East (AME) and West (VRIC).
About the Wicheeda REE Project
The 100% owned, 4,262-hectare (~10,532-acre) Wicheeda REE Project is located approximately 80 km northeast of the city of Prince George, British Columbia: population 77,000. The Wicheeda project is readily accessible by all-weather gravel roads and is near infrastructure, including power transmission lines, gas pipelines, the Canadian National Railway, and major highways.
The 2021 Wicheeda REE Project Preliminary Economic Assessment technical report (“PEA”) outlined a robust after-tax net present value (NPV@8%) of $517 million and an 18% IRR[1]. This PEA contemplated an open pit mining operation with a 1.75:1 (waste: mill feed) strip ratio providing a 1.8 Mtpa (“million tonnes per year”) mill throughput producing an average of 25,423 tonnes REO annually over a 16 year mine life. A Phase 1 initial pit strip ratio of 0.63:1 (waste: mill feed) would yield rapid access to higher grade surface mineralization in year 1 and payback of $440 million initial capital within 5 years.
Qualified Person
The scientific and technical information contained in this news release as it relates to the Wicheeda REE Project has been reviewed and approved by Kristopher J. Raffle, P.Geo. (B.C.), Principal and Consultant of APEX Geoscience Ltd. of Edmonton, Alberta, who is a director of Defense Metals and a “Qualified Person” (“QP”) as defined in NI 43-101. Mr. Raffle has verified the data, which included a review of the sampling, analytical and test methods underlying the data, information and opinions disclosed herein.
About Defense Metals Corp.
Defense Metals Corp. is a company focused on the development of its 100% owned Wicheeda Rare Earth Element mineral deposit, located near Prince George, British Columbia, Canada, that contains metals and elements commonly used in in green energy, aerospace, automotive and defense technologies. Rare earth elements are especially important in the production of magnets 1 Independent Preliminary Economic Assessment for the Wicheeda Rare Earth Element Project, British Columbia, Canada, dated January 6, 2022, with an effective date of November 7, 2021, and prepared by SRK Consulting (Canada) Inc. is filed under Defense Metals Corp.’s Issuer Profile on SEDAR (www.sedar.com). used in wind turbines and in permanent magnet motors for electric vehicles. Defense Metals Corp. trades in Canada under the symbol “DEFN” on the TSX Venture Exchange, in the United States, under “DFMTF” on the OTCQB and in Germany on the Frankfurt Exchange under “35D”.
For further information, please contact:
Todd Hanas, Bluesky Corporate Communications Ltd. Vice President, Investor Relations Tel: (778) 994 8072 Email: todd@blueskycorp.ca Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Cautionary Statement Regarding “Forward-Looking” Information This news release contains “forward‐looking information or statements” within the meaning of applicable securities laws, which may include, without limitation, statements relating to advancing the Wicheeda REE Project, the Company’s plans for its Wicheeda REE Project, attending the conferences, the technical, financial and business prospects of the Company, its project and other matters. All statements in this news release, other than statements of historical facts, that address events or developments that the Company expects to occur, are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including the price of rare earth elements, the anticipated costs and expenditures, the ability to achieve its goals, that general business and economic conditions will not change in a material adverse manner, that financing will be available if and when needed and on reasonable terms. Such forward-looking information reflects the Company’s views with respect to future events and is subject to risks, uncertainties and assumptions, including the risks and uncertainties relating to the interpretation of exploration results, risks related to the inherent uncertainty of exploration and cost estimates, the potential for unexpected costs and expenses and those other risks filed under the Company’s profile on SEDAR at www.sedar.com. While such estimates and assumptions are considered reasonable by the management of the Company, they are inherently subject to significant business, economic, competitive and regulatory uncertainties and risks. Factors that could cause actual results to differ materially from those in forward looking statements include, but are not limited to, continued availability of capital and financing and general economic, market or business conditions, adverse weather and climate conditions, failure to maintain or obtain all necessary government permits, approvals and authorizations, failure to maintain community acceptance (including First Nations), risks relating to unanticipated operational difficulties (including failure of equipment or processes to operate in accordance with specifications or expectations, cost escalation, unavailability of personnel, materials and equipment, government action or delays in the receipt of government approvals, industrial disturbances or other job action, and unanticipated events related to health, safety and environmental matters), risks relating to inaccurate geological and engineering assumptions, decrease in the price of rare earth elements, the impact of Covid-19 or other viruses and diseases on the Company’s ability to operate, an inability to predict and counteract the effects of COVID19 on the business of the Company, including but not limited to, the effects of COVID-19 on the price of commodities, capital market conditions, restriction on labour and international travel and supply chains, loss of key employees, consultants, or directors, increase in costs, delayed drilling results, litigation, and failure of counterparties to perform their contractual obligations. The Company does not undertake to update forward‐looking statements or forward‐ looking information, except as required by law.
[1] Independent Preliminary Economic Assessment for the Wicheeda Rare Earth Element Project, British Columbia, Canada, dated January 6, 2022, with an effective date of November 7, 2021, and prepared by SRK Consulting (Canada) Inc. is filed under Defense Metals Corp.’s Issuer Profile on SEDAR (www.sedar.com).
NEW YORK, NY / ACCESSWIRE / January 19, 2023 / Engine Gaming and Media, Inc. (“Engine” or the “Company”) (NASDAQ:GAME)(TSXV:GAME), a data-driven, gaming, media and influencer marketing platform company, today announced the Company has received notice from The Nasdaq Stock Market (“NASDAQ”) on January 19, 2023 informing Engine that it has regained compliance with the minimum bid price requirement under NASDAQ Listing Rule 5550(a)(2) for continued listing on The Nasdaq Capital Market. Consequently, Engine is now in compliance with all applicable listing standards and its common stock will continue to be listed on The Nasdaq Capital Market.
Engine was previously notified by NASDAQ on June 23, 2022 that it was not in compliance with the minimum bid price rule because its common stock failed to meet the closing bid price of $1.00 or more for 30 consecutive business days. In order to regain compliance with the Rule, the Company was required to maintain a minimum closing bid price of $1.00 or more for at least 10 consecutive trading days. This requirement was met on January 18, 2023, the tenth consecutive trading day when the closing bid price of the Company’s common stock was over $1.00.
About Engine Gaming and Media, Inc.
Engine Gaming and Media, Inc. (NASDAQ:GAME)(TSXV:GAME) provides unparalleled live streaming data and social analytics, influencer relationship management and monetization, and programmatic advertising to support the world’s largest video gaming companies, brand marketers, ecommerce companies, media publishers and agencies to drive new streams of revenue. The company’s subsidiaries include Stream Hatchet, the global leader in gaming video distribution analytics; Sideqik, a social influencer marketing discovery, analytics, and activation platform; and Frankly Media, a digital publishing platform used to create, distribute, and monetize content across all digital channels. Engine Gaming generates revenue through a combination of software-as-a-service subscription fees, managed services, and programmatic advertising. For more information, please visit www.enginegaming.com.
Cautionary Statement on Forward-Looking Information
This news release contains forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Engine to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. In respect of the forward-looking information contained herein, Engine has provided such statements and information in reliance on certain assumptions that management believed to be reasonable at the time. Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements stated herein to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Actual results could differ materially from those currently anticipated due to a number of factors and risks. Accordingly, readers should not place undue reliance on forward-looking information contained in this news release.
The forward-looking statements contained in this news release are made as of the date of this release and, accordingly, are subject to change after such date. Engine does not assume any obligation to update or revise any forward-looking statements, whether written or oral, that may be made from time to time by us or on our behalf, except as required by applicable law.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Company Contact:
Lou Schwartz 647-725-7765
Investor Relations Contact:
Shannon Devine MZ North America Main: 203-741-8811 GAME@mzgroup.us
DENVER, Jan. 19, 2023 /CNW/ – Medicine Man Technologies operating as Schwazze, (OTCQX: SHWZ) (NEO: SHWZ) (“Schwazze” or the “Company”), announces changes to its executive financial leadership team in preparation for its growth initiatives in Colorado and New Mexico with the addition of Chief Financial Officer, Forrest Hoffmaster. Effectively immediately, Hoffmaster replaces the current CFO, Nancy Huber, who previously announced her plans to retire once the Company hired a new CFO.
As Chief Financial Officer, Forrest Hoffmaster joins the executive leadership team at Schwazze where he will be responsible for the company’s finance functions including Accounting, Audit, Risk, Tax, Treasury, Financial Planning & Analysis, Investor Relations, and Capital Markets. In addition, he will oversee the company’s data analytics and information technology functions. Hoffmaster brings to Schwazze a 30-year career with broad C-suite experience in purpose-driven companies including Whole Foods, HEB Grocery, Advanced Micro Devices and, most recently, with New Seasons Market headquartered in Portland, Oregon.
As CEO of New Seasons Market, a specialty gourmet food retailer, Hoffmaster successfully led the company through one of the most disruptive periods within the company’s history and the retail grocery industry. Grounded in founder-inspired values, he stewarded the company to financial health growing EBITDA by 30% over two years, with a deliberate growth strategy coupled with operating cost optimization, resulting in a successful sale and integration of the company with Good Food Holdings LLC.
Prior to New Seasons Market, Hoffmaster spent 15 years with Whole Foods Market in various capacities in finance and operations. Previously he was with HEB Grocery and Advanced Micro Devices in finance management roles. Hoffmaster began his career as a CPA with Arthur Andersen focusing on SEC and GAAP compliance and reporting, graduating from the University of Houston Cum Laude with a BBA in Accounting in 1993.
“We are excited about the addition of Forrest Hoffmaster to our executive leadership team as Chief Financial Officer. Hoffmaster brings a wealth of financial and operational experience that will enable Schwazze’s growth strategy, optimize its operating costs, and foster a performance-driven organization,” said Justin Dye, Chairman and CEO of Schwazze. “We thank Nancy Huber, outgoing CFO, for her invaluable contributions since 2019 and wish her well in her retirement.”
“I am excited to join such a deeply experienced, operationally focused team at Schwazze and look forward to the growth and success ahead. Schwazze has solid fundamentals and is writing an incredibly successful story as an admired retailer with a house of brands in the cannabis industry. I am looking forward to contributing to that,” said Forrest Hoffmaster.
Since April 2020, Schwazze has acquired, opened or announced the planned acquisition of 41 cannabis retail dispensaries (Star Buds, Emerald Fields and R.Greenleaf) as well as seven cultivation facilities and two manufacturing plants in Colorado and New Mexico. In May 2021, Schwazze announced the creation of its Biosciences division, and in August 2021 it commenced home delivery services in Colorado.
About Schwazze
Schwazze (OTCQX: SHWZ; NEO: SHWZ) is building a premier, vertically integrated regional cannabis company with assets in Colorado and New Mexico and will continue to take its operating system to other states where it can develop a differentiated regional leadership position. Schwazze is the parent company of a portfolio of leading cannabis businesses and brands spanning seed to sale. The Company is committed to unlocking the full potential of the cannabis plant to improve the human condition. Schwazze is anchored by a high-performance culture that combines customer-centric thinking and data science to test, measure, and drive decisions and outcomes. The Company’s leadership team has deep expertise in retailing, wholesaling, and building consumer brands at Fortune 500 companies as well as in the cannabis sector. Schwazze is passionate about making a difference in our communities, promoting diversity and inclusion, and doing our part to incorporate climate-conscious best practices.
Medicine Man Technologies, Inc. was Schwazze’s former operating trade name. The corporate entity continues to be named Medicine Man Technologies, Inc. Schwazze derives its name from the pruning technique of a cannabis plant to enhance plant structure and promote healthy growth. To learn more about Schwazze, visit www.Schwazze.com.
Forward-Looking Statements
This press release contains “forward-looking statements.” Such statements may be preceded by the words “plan,” “will,” “may,” “continue,” “predicts,” or similar words. Forward-looking statements are not guarantees of future events or performance, are based on certain assumptions, and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company’s control and cannot be predicted or quantified. Consequently, actual events and results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with (i) our inability to manufacture our products and product candidates on a commercial scale on our own or in collaboration with third parties; (ii) difficulties in obtaining financing on commercially reasonable terms; (iii) changes in the size and nature of our competition; (iv) loss of one or more key executives or scientists; (v) difficulties in securing regulatory approval to market our products and product candidates; (vi) our ability to successfully execute our growth strategy in Colorado and outside the state, (vii) our ability to consummate the acquisition described in this press release or to identify and consummate future acquisitions that meet our criteria, (viii) our ability to successfully integrate acquired businesses, including the acquisition described in this press release, and realize synergies therefrom, (ix) the ongoing COVID-19 pandemic, * the timing and extent of governmental stimulus programs, and (xi) the uncertainty in the application of federal, state and local laws to our business, and any changes in such laws. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company’s filings with the Securities and Exchange Commission (SEC), including the Company’s Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. Investors and security holders are urged to read these documents free of charge on the SEC’s website at http://www.sec.gov. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise except as required by law.
Schwazze (OTCQX:SHWZ, NEO:SHWZ) is building a premier vertically integrated regional cannabis company with assets in Colorado and New Mexico and will continue to take its operating system to other states where it can develop a differentiated regional leadership position. Schwazze is the parent company of a portfolio of leading cannabis businesses and brands spanning seed to sale. The Company is committed to unlocking the full potential of the cannabis plant to improve the human condition. Schwazze is anchored by a high-performance culture that combines customer-centric thinking and data science to test, measure, and drive decisions and outcomes. The Company’s leadership team has deep expertise in retailing, wholesaling, and building consumer brands at Fortune 500 companies as well as in the cannabis sector. Schwazze is passionate about making a difference in our communities, promoting diversity and inclusion, and doing our part to incorporate climate-conscious best practices.
Joe Gomes, Managing Director – Generalist Analyst, Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
A Change. Yesterday, Schwazze announced that the Company hired a new Chief Financial Officer in Forrest Hoffmaster. Mr. Hoffmaster will be replacing the previous CFO Nancy Huber, who previously announced her plans to retire once the Company hired a new CFO.
Background on Mr. Hoffmaster. Forrest Hoffmaster previously was CEO of New Seasons Market, and prior to that position spent 15 years with Whole Foods Market in various capacities in finance and operations. He also was with HEB Grocery and Advanced Micro Devices in finance management roles. Mr. Hoffmaster graduated Cum Laude with a BBA in Accounting at the University of Houston in 1993.
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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.
Mark Reichman, Senior Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Exploration continues at Hopedale. Labrador Gold released results from grab and channel samples from the northernmost Thurber Dog license at the company’s Hopedale project in Labrador. Hopedale consists of 998 claims in five licenses covering 249 square kilometers of the Florence Lake greenstone belt. Previous work by others revealed significant gold in rock and soil over a three kilometer strike length, including four mineralized occurrences: 1) Thurber North with up to 3.8 grams per tonne, 2) TD500 with up to 21.59 grams per tonne, 3) Thurber Dog with up to 11.4 grams per tonne, and Thurber South with up to 4.1 grams per tonne. In addition to gold, the property has nickel and copper potential.
Encouraging assay results. Grab samples at TD500 returned gold values ranging from 0.46 grams per tonne to 21.59 grams per tonne. Channel sampling over a strike length of 60 meters returned 2.91 grams gold per tonne over 5.17 meters including 14.02 grams of gold per tonne over 0.61 meters, 2.35 grams of gold per tonne over 6.88 meters, and 4.23 grams of gold per tonne over 5.04 meters. Shear hosted gold mineralization has been discovered over a 35 meter strike length. Grab samples at the Kaapak copper occurrence returned up to 10.2% copper with seven of nine grab samples assaying over 1% copper. Channel sampling over a strike length of 50 meters at Kaapak returned copper values of up to 3.31%.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
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*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.
Image credit: National Human Genome research (Flickr)
What the FDA’s Accelerated Approval of a New Alzheimer’s Drug Could Mean for Those with the Disease – 5 Questions Answered about Lecanemab
The U.S. Food and Drug Administration (FDA) approved the medication Lecanemab, sold under the brand name Leqembi, on Jan. 6, 2023, through an “accelerated approval pathway” that fast-tracks promising clinical treatments for diseases in which there are no other currently effective options.
James E. Galvin, a neurologist from the University of Miami School of Medicine, specializes in the study of Alzheimer’s disease and Lewy body dementia. Below he explains the drug’s clinical potential to help ease the suffering of the roughly 6.5 million Americans who live with Alzheimer’s.
How Does Lecanemab Work, Biologically Speaking?
Lecanemab is a monoclonal antibody that targets beta-amyloid, a naturally occurring protein that becomes toxic when it clumps together to form the characteristic plaques that accumulate in the brains of people with Alzheimer’s disease. The drug is given through intravenous infusions every two weeks.
Antibodies are Y-shaped proteins circulating in the blood that recognize and neutralize substances in the body that they see as foreign, such as bacteria and viruses. A monoclonal antibody is produced by cloning, or making a copy of, a single white blood cell so that all the offshoot antibodies are derived from the same cell and bind to one specific target. In this case, lecanemab binds only to beta-amyloid proteins.
Lecanemab binds to a particular form of beta-amyloid as it clumps, called a protofibril. Studies suggest this is the species of beta-amyloid that is both most likely to aggregate into plaques that disrupt cell functioning and to play a role in the development of Alzheimer’s disease.
Earlier trials of other monoclonal antibodies failed to demonstrate a benefit and had more side effects, possibly because they targeted forms of beta-amyloid either too early or too late in the aggregation process.
Image: Misfolded beta-amyloid proteins aggegrate into clumps, called plaques, that form in the brains of people with Alzheimer’s
Could Lecanemab be a Game Changer for Alzheimer’s Treatment?
Potentially, yes, for people with early-stage Alzheimer’s disease. Medications such as lecanemab have the potential to interfere with the progression of Alzheimer’s disease by removing beta-amyloid from the brains of people who are suffering with it.
Two recent publications describe results from two different phases of clinical trials.
One study, published in early January 2023, reported the results of a phase 3 clinical trial that included 1,795 participants, half of whom received lecanemab and another half who didn’t. In that trial, treatment with lecanemab not only met all its clinical outcomes and safety requirements, but it also reduced the amounts of beta-amyloid measured in imaging tests and in the blood.
Researchers also saw reductions in the levels of tau – the protein responsible for the neurofibrillary tangles that accumulate inside the neurons in patient’s with Alzheimer’s. And they found reduced levels of other proteins that measure brain injury and degeneration. This suggests that lecanemab could potentially address the disease by targeting it through both direct and indirect pathways.
A separate study published in December 2022 reported the results of a phase 2 study with 856 participants. Lecanemab treatment also led to significant reductions in amyloid plaques on brain imaging tests, reductions in blood measurements of amyloid and tau protein and slowing of disease progression. These findings provide independent confirmation of the phase 3 findings and support the potential of lecanemab in the treatment of Alzheimer’s disease.
What Were the Results?
After 18 months of treatment in the phase 3 study, lecanemab slowed disease progression by 27% compared with the control group. Compared with those who didn’t receive the treatment, participants treated with lecanemab also showed 26% less decline on cognitive testing and a 36% slower loss of function in everyday activities. The study also found a marked reduction in the amount of beta-amyloid deposits in the brains of those who received the treatment.
These outcomes are the some of the largest effects yet seen in any Alzheimer’s disease clinical trial. While not cures, they provide hope that by significantly slowing physical, cognitive and functional decline while also removing amyloid, the course of disease might be altered in a way to give patients improved quality of life.
It is important to remember that the trial was only carried out over 18 months, so we do not fully know the long-term benefits of lecanemab. Ongoing long-term studies will hopefully bring additional insights. However, some recent simulation models have suggested that lecanemab treatment may provide long-term benefits and improve overall quality of life.
While lecanemab has shown clear benefits, it also comes with some notable potential adverse effects that need to be considered. In this case, the concerns are very specific to treatment with amyloid monoclonal antibodies.
In the phase 3 clinical trial, of the 1,795 participants, 12.6% taking lecanemab experienced swelling of the brain on MRI scans compared to 1.7% of those who received the placebo. Overall, only 2.8% of participants experienced any symptoms – mostly headaches.
In addition, 17.3% of those who received lecanemab had small hemorrhages, or bleeds, of the brain on MRI scans compared to 9% in the placebo group. While few participants experienced complications, at least three deaths due to brain hemorrhage have been reported in individuals enrolled in an ongoing long-term study. But notably, each of these people appear to have had additional risk factors.
How is Lecanemab Different from Other Treatments?
The currently available Alzheimer’s treatments – which include donepezil, rivastigmine, galantamine and memantine – primarily treat symptoms. They do not address the underlying disease processes, and they have modest clinical benefits.
One medication that does treat the disease, aducanumab, sold under the brand name Aduhelm, was approved by the FDA in 2021 under the same accelerated process as lecanemab. But it has not become widely used due to controversy about its efficacy and pricing.
So lecanemab could offer the first disease-modifying medication with undisputed results for people living with the early stages of Alzheimer’s disease. It is important to note that lecanemab was not studied in and was not approved for individuals with moderate or severe stages of Alzheimer’s disease.
When Could Lecanemab Reach Patients Who Could Benefit?
Although lecanemab has received approval from the FDA, it will likely be several months before it is available for clinical use.
Eisai and Biogen, the pharmaceutical companies that developed lecanemab, recently published guidelines on their pricing policy and roll-out plans for the drug. However, the Center for Medicare and Medicaid Services has said that for now, therapies targeting beta-amyloid will not be covered by insurance except for those individuals who are enrolled in clinical trials funded by the National Institutes of Health. And commercial insurance companies generally follow Medicare guidance.
Lecanemab will have an estimated out-of-pocket cost of $26,500 per year. The drugmaker has already filed a supplemental application for traditional FDA approval. If that approval is granted, it is more likely that Medicare and commercial insurance payers will cover most of the cost of lecanemab, which would make the drug much more widely accessible to those living with Alzheimer’s disease.
This article was republished with permission from The Conversation, a news site dedicated to sharing ideas from academic experts. It represents the research-based findings and thoughts of, James E. Galvin, Professor of Neurology, University of Miami.
The IRS (Actually Congress) Makes it Less Taxing to Invest
As we enter the new tax season, there is something important investors of all ages, incomes, and investment styles may have missed. Buried in the CONSOLIDATED APPROPRIATIONS ACT, which is the $1.7 trillion legislation passed just before the holidays, is a section called the SECURE 2.0 Act of 2022. If you missed it, and don’t wish to wade through the 4,100 pages of legislation, I’ve summarized seven key features below.
I’m not a tax attorney, CPA, or IRS employee, so although my reading comprehension is decent, use the below as a starting point, then get advice from professionals or sources, including IRS.gov, you’ve come to rely upon.
Investor Benefits
It’s not a stretch to expect that SECURE 2.0 will affect most Americans’ tax-advantaged investing accounts — and most likely in a beneficial way. The bill, which builds on a retirement act passed in 2019, includes changes to 401(k)s and 403(b)s. Additionally, it now includes emergency needs provisions, ROTH changes, new rules for saving and withdrawing from retirement plans, and a 529 plan change that will be welcome for those trapped balances.
The vast majority of SECURE 2.0’s new rules begin this year, but some are not implemented until 2024 or even later.
Seven Key Areas to Help Taxpayers
#1 Automatic Enrollment and Plan Portability (Starts 2025)
This requires businesses adopting new 401(k) and 403(b) plans to automatically enroll eligible employees, starting at a contribution rate of at least 3%, beginning in 2025. It also permits retirement plan service providers to offer plan sponsors automatic portability services, transferring an employee’s retirement accounts to a new plan if they change jobs. This could benefit those that would be confused by the myriad of investments in a brokerage IRA as compared to a prepackaged 401(k) eligible retirement plan at the new employer.
#2 – Emergency Savings (Starts 2024)
Defined contribution retirement plans would be able to add an emergency savings account in the form of a designated Roth account eligible to accept participant contributions for non-highly compensated employees starting in 2024. Contributions would be limited to $2,500 annually (or lower, as set by the employer), and the first four withdrawals in a year would be tax and penalty-free. Depending on plan rules, contributions may be eligible for an employer match. In addition to giving participants penalty-free access to funds, an emergency savings fund could encourage plan participants to save for short-term and unexpected expenses.
#3 – Student Loan Debt (Starts 2024)
Employers will be able to “match” employee student loan payments beginning in 2024 with matching payments to a retirement account. This aids workers with increased retirement savings while they are paying off educational loans.
#4 – 529 Plans Rolled to Roth (Begins 2023)
After 15 years of aging, 529 plan assets can be rolled over to a Roth IRA for the beneficiary over five years. This is subject to the annual Roth contribution maximum with a lifetime cap of $35,000. The rollover is treated as a contribution towards the annual Roth IRA contribution limit.
#5 – Distributions Required by Law (Begins 2023)
When you’ve built up your IRA, 401(k), or 403(b) or other tax-advantaged money, you can’t shelter it from taxes forever. In the past, the IRS required you to pull an amount out, based on their calculation, each year upon reaching 72 years of age. This money is then fully taxable if it was sheltered from taxes when it was placed in the account. The Act now gives us an extra year to allow our investments to grow before beginning withdrawals. Starting in 2023, the age at which owners of retirement accounts must start taking required minimum distributions (RMDs) increased to 73.
The SECURE 2.0 Act then increases the age at which RMDs must start to 75 starting in 2033.
There had been a steep penalty for failure to withdraw your RMD. It has been dropped from 50% of the amount not taken to 25%. By any measure, 25% is still a severe penalty, but it is better than having forgetfulness cost you 50% of your money. Better yet, the penalty will be reduced to 10% for IRA owners if the account holder withdraws the RMD amount previously not taken and submits a corrected tax return in a timely manner. The rationale is that self-managed IRAs are more likely to be missed than assets in 401(k) plans.
Additionally, Roth accounts in employer retirement plans will be exempt from the RMD requirements starting in 2024.
Starting the first day of 2025, individuals ages 60 through 63 years old will be able to make catch-up contributions of up to $10,000 annually to a workplace plan; this amount will then be indexed to inflation. The catch-up amount for people aged 50 and older has not changed for 2023 ($7,500.) There is, however, a “but.” If you earned more than $145,000 in the prior calendar year, all catch-up contributions at age 50 or older will need to be made to a Roth account in after-tax dollars. Individuals earning $145,000 or less, adjusted for inflation going forward, will be exempt from this Roth requirement.
IRAs currently have a $1,000 catch-up contribution limit for people aged 50 and over. Starting in 2024, that limit will be indexed to inflation, meaning it could adjust every year based on federally determined cost-of-living changes.
#7 – Employer Matching for Roth Accounts(Begins 2024)
Employers will be able (although not required) to provide employees the option of receiving vested matching contributions to Roth accounts. Until now, any employer match in a sponsored plan was made on a pre-tax basis. Contributions to a Roth retirement plan are made after tax, after which earnings can grow tax-free.
In 2024, Roth RMDs from an employer-sponsored plan is no longer required. This money can stay invested and even grow tax-free for as long as the account owner deems it prudent.
Take Away
The SECURE 2.0 Act provides over 90 changes that impact taxes, at the same time, could mean increased business for the firms involved in administering qualified plans. The law builds on earlier changes that increased the age at which retirees must take RMDs.
There are many small provisions in the new law; the highlights include helping younger workers save while they continue to pay off student debt, also making it easier to move accounts from one employer to another and to enable people to save for emergencies within retirement accounts.
Older Americans could feel a more immediate benefit from the increased age at which retirees must begin taking RMDs from IRA and 401(k) accounts and the increase in the size of catch-up contributions for older workers’ plans.
SECURE 2.0 provides increased opportunities to save for retirement. Everyone’s financial situation is different. As always, consult a tax professional to understand how these changes best apply to your situation. We encourage you to consult Channelchek and other trusted sources of investment information as you weigh decisions related to the investments themselves.
InPlay Oil is a junior oil and gas exploration and production company with operations in Alberta focused on light oil production. The company operates long-lived, low-decline properties with drilling development and enhanced oil recovery potential as well as undeveloped lands with exploration possibilities. The common shares of InPlay trade on the Toronto Stock Exchange under the symbol IPO and the OTCQX Exchange under the symbol IPOOF.
Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Production slows. Management projects 2022 production of 9,100-9,200 BOE/d versus 11/9/22 guidance of 9,150-9,400. Downtime at a third party gas facility led to a 435 BOE/d decrease in production. Cold weather also delayed getting wells on line. We have reduced our estimate to 9,162 BOE/d from 9,280. The company projects 2023 production of 9,500-10,000 BOE/d down from 9,900-10,400. We have lowered our forecast to 10,000 BOE/d from 10,400 to be within management’s guidance. We are comfortable being at the upper end of guidance given InPlay’s history of surpassing guidance (until the most recent quarter).
Expenditures rise. The company projects 2022 capital expenditures of C$76-78 million up from C$70-72 million due the acceleration of a drilling program. 2023 capital expenditure guidance increased to C$75-80 million (versus C$69-71 million) despite the drilling of 0.5 net wells less than previously assumed. Management attributes the higher capital expenditures mainly to two gas facility upgrades but also notes that it plans to drill longer wells in 2023 than in 2022.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
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.
Mark Reichman, Senior Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
2022 exploration program. The goal of Eskay Mining’s 2022 exploration program was to identify new precious metal-rich volcanogenic massive sulfide (VMS) deposits across its Consolidated Eskay Project based on mapping and geochemical sampling, along with more advanced work including widely-spaced drilling. During the 2022 exploration season, Eskay Mining completed 29,500 meters of diamond drilling along the TV-Jeff corridor and along the Scarlet Ridge-Tarn Lake Trend.
New precious metal-rich VMS system. Through its exploration work at Scarlet Knob-Tarn Lake, the company confirmed the presence of a second major trend of gold and silver-rich VMS mineralization at the northern end of the Eastern anticline which runs parallel to the Eskay anticline that hosts the Eskay Creek deposit located approximately seven kilometers to the west. Additionally, management thinks Tarn Lake and Scarlet Knob may be connected.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
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.
