Month: March 2024

Townsquare Media (TSQ) – Improving Fundamental Outlook; Boosts Dividend

Posted on by cpereira@noblefcm.com


Monday, March 18, 2024

Townsquare is a community-focused digital media and digital marketing solutions company with market leading local radio stations, principally focused outside the top 50 markets in the U.S. Our assets include a subscription digital marketing services business, Townsquare Interactive, providing website design, creation and hosting, search engine optimization, social media and online reputation management as well as other digital monthly services for approximately 26,800 SMBs; a robust digital advertising division, Townsquare IGNITE, a powerful combination of a) an owned and operated portfolio of more than 330 local news and entertainment websites and mobile apps along with a network of leading national music and entertainment brands, collecting valuable first party data, and b) a proprietary digital programmatic advertising technology stack with an in-house demand and data management platform; and a portfolio of 321 local terrestrial radio stations in 67 U.S. markets strategically situated outside the Top 50 markets in the United States. Our portfolio includes local media brands such as WYRK.com, WJON.com, and NJ101.5.com and premier national music brands such as XXLmag.com, TasteofCountry.com, UltimateClassicRock.com and Loudwire.com.

Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.

Jacob Mutchler, Research Associate, Noble Capital Markets, Inc.

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

Solid Q4 Results. The company reported Q4 revenue of $114.8 million and adj. EBITDA of $24.8 million, in line with expectations. Revenue for full year 2023 declined a modest 0.9%, excluding political revenue, and adj. EBITDA decreased 9.1% when political is excluded. Digital Advertising was a bright spot for the company in 2023, increasing a solid 7.1% from the prior year. Notably, revenue and adj. EBITDA met the company’s previously issued full year guidance. 

Digital at its trough. Digital revenue in Q4 was down 6.4% from the prior year period. The decrease was attributed to softness in Digital Marketing Solutions, which declined $3.2 million or 14.5% in the quarter. Management provided a sanguine view that this business may have troughed and is positioned for growth by year end. 


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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. 

Seanergy Maritime (SHIP) – Strong results allow us to raise our estimates and price target

Posted on by cpereira@noblefcm.com


Monday, March 18, 2024

Seanergy Maritime Holdings Corp. is the only pure-play Capesize ship-owner publicly listed in the US. Seanergy provides marine dry bulk transportation services through a modern fleet of Capesize vessels. The Company’s operating fleet consists of 17 Capesize vessels with an average age of approximately 12 years and aggregate cargo carrying capacity of approximately 3,011,083 dwt. The Company is incorporated in the Marshall Islands and has executive offices in Glyfada, Greece. The Company’s common shares trade on the Nasdaq Capital Market under the symbol “SHIP” and its Class B warrants under “SHIPZ”.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

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

Shipping rates were even higher than our recently-raised rates. Shipping rates spiked in December. We raised our estimates in February to reflect favorable conditions, but rates surpassed our raised projections. Seanergy was able to extend/reprice six vessels at favorable terms due to higher rates.

Seanergy has fixed 93% of 2024-1Q and 58% of 2024-2Q operating days at attractive prices. We believe cash flow and earnings will be fairly stable due to fixed prices. Seanergy’s exposure to shipping rates increases as the year progresses as charters expire and the company adds vessels to its fleet.


Get the Full Report

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. 

Titan Medical Announces Transformative Merger with Conavi Medical

Posted on by slightbourne@noblecapitalmarkets.com

Toronto-based medical device company Titan Medical Inc. (TSX: TMD) unveiled a definitive agreement to merge with Conavi Medical Inc. in an all-stock transaction that will create a new publicly-traded leader in hybrid intravascular imaging.

The deal, announced on March 18, 2024, will see Titan acquire all of the outstanding shares of Conavi, a commercial-stage firm that has developed the Novasight Hybrid System for guiding minimally invasive coronary procedures. In exchange, Conavi shareholders will receive newly issued shares of Titan.

The merger will constitute a reverse takeover of Titan by Conavi. Upon completion, the combined entity plans to change its name to Conavi Medical Inc. and apply to list its shares on the TSX Venture Exchange after delisting from the Toronto Stock Exchange.

“This planned merger comes at a pivotal moment as we advance the Novasight Hybrid System, unlocking its full potential in the U.S. and globally,” said Thomas Looby, CEO of Conavi. “Gaining public company status will enhance our financial strength and growth strategy.”

Conavi’s Novasight Hybrid system is the first to combine intravascular ultrasound (IVUS) and optical coherence tomography (OCT) imaging modalities, enabling simultaneous and co-registered imaging of coronary arteries. It has regulatory approvals in the U.S., Canada, China and Japan.

Paul Cataford, Interim CEO and Board Chair of Titan, said “Conavi is an exciting commercial-stage company with groundbreaking technology. We are confident in their ability to drive adoption of the Novasight Hybrid System.”

As part of the transaction, Conavi will complete a concurrent equity financing raising between $15-20 million before the deal closes around July 15th. The financing is expected to attract support from institutional investors.

Take a moment to take a look at Noble Capital Markets’ Senior Research Analyst Robert Leboyer’s coverage universe.

Key benefits anticipated for the combined company include a strong balance sheet following the financing, established product capabilities, a proven coronary imaging product being commercialized, a large market opportunity, and increasing user traction.

Under the agreement terms, Titan will consolidate its shares on an agreed ratio prior to the merger. A Titan subsidiary will then amalgamate with Conavi, with Titan issuing new consolidated shares to Conavi shareholders based on an exchange ratio valuing Conavi at $69.84 million pre-money. This ratio will ensure existing Titan shareholders own at least 10% of the combined company.

All officers and certain Titan directors will resign upon closing and be replaced by Conavi nominees. The merger requires approval from shareholders of both companies as well as regulatory approvals. Titan’s board unanimously recommends shareholders vote in favor based on a fairness opinion from its financial advisor.

The transaction marks the culmination of a strategic review process for Titan over the past 15 months. The company previously halted work on its surgical robotics program to conserve cash before pursuing asset sales and IP licensing deals.

With Conavi’s commercial hybrid imaging technology and anticipated financial resources from the merger and financing, the combined company aims to drive market penetration in the fast-growing field of intravascular imaging for coronary procedures. The deal transforms Titan from an R&D-stage firm into a revenue-generating medtech leader.

Geron Stock Skyrockets on Pivotal FDA Panel Backing for Blood Disorder Drug

Posted on by slightbourne@noblecapitalmarkets.com

In a major vindication for Geron Corporation’s therapeutic pipeline, the biotech company’s shares skyrocketed nearly 90% in after-hours trading Thursday after receiving a critical green light from U.S. drug regulators.

In a 12-2 vote, the Food and Drug Administration’s Oncologic Drugs Advisory Committee (ODAC) ruled that the clinical benefits of Geron’s investigational drug imetelstat outweigh its risks for treating a serious blood disorder. Specifically, the independent panel of experts endorsed imetelstat as a potential new therapy for transfusion-dependent anemia in certain adult patients with low to intermediate-risk myelodysplastic syndromes.

Myelodysplastic syndromes (MDS) are a group of malignant bone marrow disorders that disrupt the production of healthy blood cells. In the lower-risk forms of MDS being targeted by imetelstat, anemia caused by a lack of red blood cells is one of the most problematic complications, often requiring regular blood transfusions.

Imetelstat, an innovative first-in-class drug candidate, works by inhibiting the enzyme telomerase. This mechanism of action allows imetelstat to potentially restore normal red blood cell production and alleviate the need for transfusions in these MDS patients.

In Geron’s pivotal phase 3 IMerge study involving over 200 patients, those treated with imetelstat showed significantly higher rates of achieving red blood cell transfusion independence for at least 8 weeks compared to placebo. The study also found 28% of imetelstat patients achieved transfusion independence for 24 weeks or longer – with a median duration of 80 weeks. Only 3% of those on placebo matched that level of durable response.

“There are few treatment options and significant unmet medical need remains for these patients, particularly among those with difficult-to-treat subtypes of this blood cancer,” said Faye Feller, Geron’s chief medical officer. “We believe that imetelstat has the potential to be an important new medicine.”

Wall Street clearly agrees with that assessment. Geron shares, which had already surged over 60% year-to-date in anticipation of Thursday’s advisory meeting, ripped nearly 90% higher in extended trading after the result was announced.

While not binding, the FDA typically follows the recommendations of its advisory panels when making final approval decisions. The agency has set a target action date of June 16 to decide on whether to greenlight imetelstat for MDS patients based on the totality of evidence – including the IMerge trial data and ODAC’s favorable risk-benefit evaluation.

Approval appears likely after the decisive ODAC vote, providing a tremendous boost for Geron as it pushes ahead with commercialization plans for imetelstat. In addition to seeking FDA approval, the company is pursuing European regulatory clearance after submitting its marketing application to health authorities there last year.

Analysts see imetelstat generating hundreds of millions in peak sales if approved for this initial MDS population with unmet needs. But Geron is also evaluating the drug’s potential utility in other blood and bone marrow disorders like myelofibrosis, significantly expanding imetelstat’s commercial opportunity.

Even after Thursday’s enormous stock spike, Geron remains modestly valued at around $1.5 billion in market capitalization. While certainties remain around pricing, reimbursement and ultimate market penetration, the positive ODAC outcome drastically improves the outlook for this longtime drugmaker to finally bring its first product to market after years of development setbacks.

For a company that has relied primarily on partnerships, licensing deals and equity raises to sustain its operations, having a wholly-owned product with multi-billion dollar sales potential could completely transform Geron’s outlook – validating the bold decision to double down on imetelstat’s high-risk, high-reward proposition in recent years.

While challenges still lie ahead, investors are clearly salivating over imetelstat’s bright future after the pivotal FDA panel vote removed a major roadblock on the path to potential commercialization. The overwhelmingly positive outcome sent an unmistakable signal that Geron may finally be nearing the lucrative promised land after getting mired in drug development purgatory for decades.

Apple Ramps Up AI Capabilities With Acquisition of Startup DarwinAI

Posted on by slightbourne@noblecapitalmarkets.com

Apple is making a concerted push to bring generative artificial intelligence capabilities to its core products and services, as evidenced by its recent acquisition of Canadian startup DarwinAI.

The iPhone maker purchased the AI company earlier this year, according to a report from Bloomberg. While Apple remained characteristically tight-lipped about the deal’s financial terms or strategic rationale, the move signals Apple is accelerating its efforts to match rivals like Microsoft and Google in deploying advanced AI across its offerings.

DarwinAI specialized in using artificial intelligence for visual inspection and analysis during the manufacturing process. Its technology served customers across multiple industries to automatically detect defects and anomalies in components through AI-powered computer vision models.

As part of the acquisition, dozens of DarwinAI employees have been absorbed into Apple’s artificial intelligence division, the report states. This influx of AI talent and technical expertise could prove critical as Apple looks to develop its own large language models and generative AI applications.

Alexander Wong, an AI researcher from the University of Waterloo who co-founded DarwinAI, has assumed a director role overseeing portions of Apple’s AI group. His background aligns with DarwinAI’s focus on building compact, efficient AI systems that can run on-device without constant cloud connectivity.

This thrust toward making AI work smoothly and privately on iPhones, iPads and Macs represents a key priority for Apple as it races to integrate generative AI across its mobile operating systems and productivity software over the next year.

At the company’s annual shareholder meeting in early March, CEO Tim Cook confirmed Apple’s intentions to “break new ground in generative AI in 2024,” citing the “breakthrough potential” and “transformative opportunities” it creates for enhancing user experiences around productivity, problem-solving and more.

Specific areas where Apple may deploy generative AI span Siri’s voice assistant capabilities, automated summarization in apps like Mail and Messages, and content creation tools within Pages, Keynote and other office productivity programs. The technology could even extend to areas like automated music playlist curation.

For the AppleCare product support team, generative AI may be leveraged to better assist customers troubleshoot technical issues by suggesting solutions based on conversational prompts. This could represent a major upgrade over today’s more manually intensive processes.

Ultimately, Apple’s biggest advantages revolve around its ability to build tighter hardware/software integration and maintain strict privacy guardrails unavailable to cloud-based rivals. The company aims to run its generative AI models directly on user devices rather than routing data to remote servers – a key differentiator from competitors like Microsoft and Google.

“We see incredible breakthrough potential for generative AI, which is why we’re currently investing significantly in this area,” Cook told shareholders.

Still, Apple faces an uphill battle catching up to the generative AI leaders. While the iPhone maker’s cautious approach focuses on curating secure AI experiences, companies like OpenAI, Anthropic and Google have rapidly advanced their public-facing products and pushed the boundaries of what’s possible with large language models.

Microsoft has already integrated AI co-pilots across its entire suite of Office apps and cloud services through partnerships with OpenAI, Anthropic and others. Google has made generative AI like Bard a centerpiece of its efforts to modernize search and productivity tools.

With developers and companies increasingly exploring AI customization and co-pilots that can streamline workflows, Apple may feel pressure to open up its ecosystem to third-party generative AI tools in the near future.

The DarwinAI acquisition represents an early step for Apple to transform itself into a formidable AI player. But just like the company’s iconic “Get a Mac” ads from years past, it may take some additional star power and rebranding to recast Apple as the face of consumer-friendly, privacy-focused artificial intelligence going forward.

Release – Harte Hanks Reports Fourth Quarter and Fiscal 2023 Full-Year Results

Posted on by aweinsoff@channelchek.com

Research News and Market Data on HHS

  • Project “Elevate” Sales and Marketing Transformation Revamped for Strategic Growth;
  • Anticipate approximately $6 Million in 2024 Cost Reductions, $16 Million over Two Years;
  • Ends Year with $18 Million of Cash and No Debt

CHELMSFORD, MA / ACCESSWIRE / March 14, 2024 / Harte Hanks, Inc. (NASDAQ:HHS), a leading global customer experience company focused on bringing companies closer to customers for over 100 years, today announced financial results for the fourth quarter and year ended December 31, 2023.

Kirk Davis, Chief Executive Officer, said: “ Project Elevate , the outcome of a comprehensive review of our business in collaboration with newly hired executive sales leadership and respected consultants, is designed to modernize our go-to-market strategy, invest in lead generation, and enable organic growth. We have added two experienced sales leaders in Kelly Waller, our new SVP of sales and marketing, and Ron Lee, our new SVP of sales services. These two accomplished sales executives are the ideal people to drive the key components of our organic growth initiatives forward. More recently, we added additional experienced personnel to lead international sales expansion, grow our newly created partner network, and form our company’s first inside sales division. These talented people are in place, and we are rapidly improving our marketing programs, value proposition, and pipeline formulation to effectively capitalize on our core competencies and key differentiators.”

“Over the next few quarters, we will be expanding our enterprise-wide revenue pipeline, participating in numerous high-profile events that facilitate one-to-one meetings with decision makers, and growing a robust partnership network,” continued Davis. “These initiatives are bolstered by a revised incentive structure for our sales team, better alignment between business units, and a clear focus on the SMB and mid-market segments. We expect these changes will drive consistent pipeline growth and enhance our sales performance over the course of the year. We’ve accomplished an end-to-end transformation of our sales and marketing strategy and structure, and the team is now in place to drive organic growth.”

“Simultaneously, we are taking steps, in collaboration with the Kearney Organization, to optimize our cost structure to enable us to invest in sales and marketing without depleting our cash reserves,” continued Davis. “We have identified costs we can eliminate totaling approximately $16 million over next two years with $6 million of savings expected in 2024. David Fisher, our new Chief Transformation Officer, is working closely with David Garrison, our new Chief Financial Officer, to execute these important changes.”

“I believe the opportunity for Harte Hanks is significant,” concluded Davis. “Our solutions meet the current and expected needs of customers, and we drive tangible value for clients and their customers. We can deliver organic growth, expanding the number of logos we work with and deepening our relationship with these customers over time. We are confident that we can streamline our organization to expand profitability and cash generation as we grow. The benefits of Project Elevate are expected to become evident in the second half of 2024 and into 2025.”

Fourth Quarter Highlights

  • The Company ended the year with a cash balance of $18.4 million compared to $10.4 million at December 31, 2022, and $13.3 million at September 30, 2023, with zero debt.
  • Extended the current $25 million line of credit until June 30, 2025.
  • Executing, as planned, the termination of Pension Plan 1.
  • Total revenues for Q4 2023 were $49.5 million, down 9.7% compared to $54.8 million in Q4 2022; included in 2023 was $2.5 million of revenue from InsideOut compared to $1.0 million in the fourth quarter of 2022.
  • Operating loss was $2.3 million compared to operating income of $3.4 million in the prior-year quarter.
  • Harte Hanks recorded $5.7 million in non-recurring restructuring charges, related primarily to consulting expenses tied to the development and execution of Project Elevate and other cost-reduction initiatives, as well as severance and lease impairment charges. There were no restructuring charges in the fourth quarter of last year.
  • Net loss, inclusive of the $5.7 million in restructuring charges, was $2.0 million, or $0.27 per basic and diluted share, compared to net income of $21.8 million, or $2.81 per basic and $2.70 per diluted share, in the prior year quarter. The fourth quarter of 2022 included a $19.8 million tax benefit.
  • The fourth quarter of 2023 had negative EBITDA of $1.1 million compared to positive EBITDA of $4.4 million in the same period in the prior year. Adjusted EBITDA, which excludes stock-based compensation, severance and restructuring charges, was $5.2 million in both Q4 2023 and 2022.

Segment Highlights

  • Customer Care, $17.7 million in revenue, 36% of total – Segment revenue increased $1.0 million or 6.0% versus the prior year and EBITDA totaled $3.7 million for the quarter, up 14.6% year-over-year. InsideOut contributed an increase of $1.4 million to revenue in the fouth quarter compared to same quarter in 2022. The increase in revenue from the sales services group offset the $0.4 million decrease in our traditional CX business.
  • Fulfillment & Logistics Services, $21.3 million in revenue, 43% of total – Segment revenue decreased $3.2 million or 12.9% versus the prior year quarter and EBITDA totaled $1.9 million, down 17.2%. Revenue mix and a 12.2% decrease in operating expenses drove the improved EBITDA margins. The margin percentage continues to be impacted by variation in the revenue mix between lower margin logistics and the higher margin fulfillment services.
  • Marketing Services, $10.5 million in revenue, 21% of total – Segment revenue decreased $3.1 million or 23.1% compared to the prior year quarter and EBITDA for the fourth quarter totaled $1.4 million vs. $2.1 million. The decrease in revenue was attributable to reduced project work in the financial services sector.

Consolidated Fourth Quarter 2023 Results

Fourth quarter revenues were $49.5 million, down 9.7% from $54.8 million in the fourth quarter of 2022 due to decreased revenue in two of the Company’s operating segments.

Fourth quarter operating loss was $2.3 million, compared to income of $3.4 million in the fourth quarter of 2022. The decrease resulted from a restructuring expense during the quarter.

Net loss for the quarter was $2.0 million, or $0.27 per basic and diluted share, compared to net income of $21.8 million, or $2.81 per basic and $2.70 per diluted share, in the fourth quarter last year. The net loss included $5.7 million of restructuring expense, without which the Net Income is estimated to be $3.7 million for the quarter. The net income for the fourth quarter of 2022 included a one time tax asset valuation reversal benefiting more than $19.8 million, without this the net income would have only been $2.0 million. Discounting for the two events in the respective fourth quarters, the estimated net income improvement was $1.7 million.

Consolidated Full Year 2023 Results

Full-year revenues were $191.5 million, down 7.2% from $206.3 million in 2022. Operating income was $3.4 million, compared to operating income of $15.1 million. Net loss for the year was $1.6 million, or $0.21 per basic and $0.21 per diluted share, compared to net income of $36.8 million, or $4.98 per basic and $4.75 per diluted share, last year.

Balance Sheet and Liquidity

Harte Hanks ended the year with $18.4 million in cash and cash equivalents and $24.2 million of capacity on its credit line. The Company has no outstanding debt as of December 31, 2023. The Company’s financial position continues to be strong, and it is well-positioned to execute on its long-term growth strategies in 2024 and beyond.

Conference Call Information

The Company will host a conference call and live webcast to discuss these results at 4:30 p.m. EST today, March 14, 2024. Interested parties may access the webcast at https://www.webcaster4.com/Webcast/Page/2810/49883 or may access the conference call by dialing 888-506-0062 in the United States or 973-528-0011 from outside the U.S. and using access code 692780.

A replay of the call can also be accessed via phone through March 28, 2024 by dialing (877) 481-4010 from the U.S., or (919) 882-2331 from outside the U.S. The conference call replay passcode is 49883.

About Harte Hanks:

Harte Hanks (NASDAQ: HHS ) is a leading global customer experience company whose mission is to partner with clients to provide them with CX strategy, data-driven analytics and actionable insights combined with seamless program execution to better understand, attract and engage their customers.

Using its unparalleled resources and award-winning talent in the areas of Customer Care, Fulfillment and Logistics, and Marketing Services, Harte Hanks has a proven track record of driving results for some of the world’s premier brands, including Bank of America, GlaxoSmithKline, Unilever, Pfizer, HBOMax, Volvo, Ford, FedEx, Midea, Sony and IBM among others. Headquartered in Chelmsford, Massachusetts, Harte Hanks has over 2,500 employees in offices across the Americas, Europe, and Asia Pacific.

For more information, visit hartehanks.com

As used herein, “Harte Hanks” or “the Company” refers to Harte Hanks, Inc. and/or its applicable operating subsidiaries, as the context may require. Harte Hanks’ logo and name are trademarks of Harte Hanks, Inc.

Cautionary Note Regarding Forward-Looking Statements:

Our press release and related earnings conference call contain “forward-looking statements” within the meaning of U.S. federal securities laws. All such statements are qualified by this cautionary note, provided pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements other than historical facts are forward-looking and may be identified by words such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “seeks,” “could,” “intends,” or words of similar meaning. These forward-looking statements are based on current information, expectations and estimates and involve risks, uncertainties, assumptions and other factors that are difficult to predict and that could cause actual results to vary materially from what is expressed in or indicated by the forward-looking statements. In that event, our business, financial condition, results of operations or liquidity could be materially adversely affected and investors in our securities could lose part or all of their investments. These risks, uncertainties, assumptions and other factors include: (a) local, national and international economic and business conditions, including (i) market conditions that may adversely impact marketing expenditures, and (ii) the impact of economic environments and competitive pressures on the financial condition, marketing expenditures and activities of our clients and prospects; (iii) the demand for our products and services by clients and prospective clients, including (iv) the willingness of existing clients to maintain or increase their spending on products and services that are or remain profitable for us, and (vi) our ability to predict changes in client needs and preferences; (b) economic and other business factors that impact the industry verticals we serve, including competition, inflation and consolidation of current and prospective clients, vendors and partners in these verticals; (c) our ability to manage and timely adjust our facilities, capacity, workforce and cost structure to effectively serve our clients; (d) our ability to improve our processes and to provide new products and services in a timely and cost-effective manner though development, license, partnership or acquisition; (e) our ability to protect our facilities against security breaches and other interruptions and to protect sensitive personal information of our clients and their customers; (f) our ability to respond to increasing concern, regulation and legal action over consumer privacy issues, including changing requirements for collection, processing and use of information; (g) the impact of privacy and other regulations, including restrictions on unsolicited marketing communications and other consumer protection laws; (h) fluctuations in fuel prices, paper prices, postal rates and postal delivery schedules; (i) the number of shares, if any, that we may repurchase in connection with our repurchase program; (j) unanticipated developments regarding litigation or other contingent liabilities; (k) our ability to complete reorganizations, including cost-saving initiatives; and (l) other factors discussed from time to time in our filings with the Securities and Exchange Commission, including under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 which was filed on March 31, 2023. The forward-looking statements in this press release and our related earnings conference call are made only as of the date hereof, and we undertake no obligation to update publicly any forward-looking statement, even if new information becomes available or other events occur in the future.

Supplemental Non-GAAP Financial Measures:

The Company reports its financial results in accordance with generally accepted accounting principles (“GAAP”). However, the Company may use certain non-GAAP measures of financial performance in order to provide investors with a better understanding of operating results and underlying trends to assess the Company’s performance and liquidity in this press release and our related earnings conference call. We have presented herein a reconciliation of these measures to the most directly comparable GAAP financial measure.

The Company presents the non-GAAP financial measure “Adjusted Operating Income” as a useful measure to both management and investors in their analysis of the Company’s financial results because it facilitates a period-to-period comparison of Operating Income excluding stock-based compensation and severance. The most directly comparable measure for this non-GAAP financial measure is Operating Income.

The Company presents the non-GAAP financial measure “EBITDA” as a supplemental measure of operating performance in order to provide an improved understanding of underlying performance trends. The Company defines “EBITDA” as Net Income adjusted to exclude income tax expense, other expense (income), net, and depreciation and amortization expense. The Company defines “Adjusted EBITDA” as EBITDA adjusted to exclude stock-based compensation and severance. The most directly comparable measure for EBITDA and Adjusted EBITDA is Net Income. We believe EBITDA and Adjusted EBITDA are an important performance metric because it facilitates the analysis of our results, exclusive of certain non-cash items, including items which do not directly correlate to our business operations; however, we urge investors to review the reconciliation of non-GAAP EBITDA to the comparable GAAP Net Income, which is included in this press release, and not to rely on any single financial measure to evaluate the Company’s financial performance.

The use of non-GAAP measures do not serve as a substitute and should not be construed as a substitute for GAAP performance but should provide supplemental information concerning our performance that our investors and we find useful. The Company evaluates its operating performance based on several measures, including these non-GAAP financial measures. The Company believes that the presentation of these non-GAAP financial measures in this press release and earnings conference call presentations are useful supplemental financial measures of operating performance for investors because they facilitate investors’ ability to evaluate the operational strength of the Company’s business. However, there are limitations to the use of these non-GAAP measures, including that they may not be calculated the same by other companies in our industry limiting their use as a tool to compare results. Any supplemental non-GAAP financial measures referred to herein are not calculated in accordance with GAAP and they should not be considered in isolation or as substitutes for the most comparable GAAP financial measures.

Investor Relations Contact:

Rob Fink or Tom Baumann
646.809.4048 / 646.349.6641
FNK IR
HHS@fnkir.com

View full release here.

SOURCE: Harte Hanks, Inc.

Harte Hanks (HHS) – On A Path Toward Revenue Growth

Posted on by cpereira@noblefcm.com


Friday, March 15, 2024

Harte Hanks (NASDAQ: HHS) is a leading global customer experience company whose mission is to partner with clients to provide them with CX strategy, data-driven analytics and actionable insights combined with seamless program execution to better understand, attract, and engage their customers. Using its unparalleled resources and award-winning talent in the areas of Customer Care, Fulfillment and Logistics, and Marketing Services, Harte Hanks has a proven track record of driving results for some of the world’s premier brands including Bank of America, GlaxoSmithKline, Unilever, Pfizer, HBOMax, Volvo, Ford, FedEx, Midea, Sony, and IBM among others. Headquartered in Chelmsford, Massachusetts , Harte Hanks has over 2,500 employees in offices across the Americas, Europe and Asia Pacific .

Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.

Jacob Mutchler, Research Associate, Noble Capital Markets, Inc.

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

Solid Q4 Results. The company reported Q4 revenue of $49.5 million, 4.6% higher than our estimate of $47.3 million. The positive revenue surprise is attributed to higher than expected Customer Care revenue. Adj. EBITDA in the quarter was $5.2 million, which beat our estimate of $3.3 million by a strong 60.3%. The favorable operating results were driven by stronger than expected Customer Care revenue, which carries a higher margins than its other revenue streams.

2024 Outlook.  In our view, the company stands to benefit from several positive developments in 2024. Notably, management highlighted its plans to reduce expenditures, with roughly $6.0 million of savings expected in 2024 and approximately $16.0 million of cost reductions planned over the next two years. Additionally, the company is developing a partnership network it plans to utilize in the coming year.


Get the Full Report

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. 

GoHealth, Inc. (GOCO) – Resetting Expectations: Still Well Positioned

Posted on by cpereira@noblefcm.com


Friday, March 15, 2024

Patrick McCann, CFA, Research Analyst, Noble Capital Markets, Inc.

Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.

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

Q4 results below expectations. The company reported Q4 revenue of $276.7 million, 23.6% below our forecast of $362.0 million. Adj. EBITDA in the quarter was $57.0 million, below our forecast of $116.1 million. The weaker than expected results were due in large part to low Medicare Advantage plan turnover, which limited the total revenue from new policy sales in the quarter.


Low plan turnover. Management noted that the average incremental benefits added to Medicare Advantage plans in 2023 was lower than usual, which resulted in less plan switching by Medicare Advantage enrollees. Of the more than 300,000 consumers it served, GoHealth’s PlanFit Checkup recommended that roughly 1/3 of them stay with their existing plans.     


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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. 

Vera Bradley (VRA) – Reports Fourth Quarter Results

Posted on by cpereira@noblefcm.com


Friday, March 15, 2024

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

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4QFY24. Revenue totaled $133.3 million, compared to $147.1 million in 4Q23, and below our estimate of $137 million. Gross margin improved to 52.3% from 40.8%. Reported net loss of $1.9 million, or $0.06/sh, compared to a net loss of $28.2 million, or $0.91/sh in 4Q22. Adjusted EPS was $0.11 versus a net loss of $0.03/sh last year. This year’s extra week added approximately $6 million to quarterly revenue and EPS by $0.01/sh. We had forecasted net income of $5 million, or $0.16/sh.

New Day. Project New Day launches in mid-July and is the first manifestation of the work under Project Restoration. New Day is a full pivot from where Vera Bradley is today. It includes, among other things, the reveal of a new and elevated full line branding and marketing, product store design, and website design.


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Maple Gold Mines (MGMLF) – Reorienting the Company for Successful Outcomes

Posted on by cpereira@noblefcm.com


Friday, March 15, 2024

Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.

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Outlook for 2024. Since his appointment as CEO, Mr. Kiran Patankar has re-oriented and re-positioned the company for successful outcomes by expanding the geological team, taking an axe to corporate general and administrative expenses, and strengthening the data driven exploration program to refine the targeting process. Maple Gold is in the process of updating three dimensional models for Douay and Joutel and prioritizing targets. The next phase of drilling is expected to commence this year, along with a follow-up program at Eagle. We expect more details regarding the next phase of drilling in April.

Technical bench strength. Maple Gold recently added three members to its geological team, including Mr. Daniel Johansson, Senior Exploration Geologist, Mr. Remi Clairet, Project Geologist, and Mr. Jackie Long, Database and Modeling. We think the collaborative effort of an expanded team, along with managing its database in-house, will sharpen and enhance the accuracy of target generation. The team will work in close collaboration with Agnico Eagle’s exploration team.


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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. 

Hemisphere Energy (HMENF) – Hemisphere releases reserve report

Posted on by cpereira@noblefcm.com


Friday, March 15, 2024

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

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Hemisphere announced an independent evaluation of its reserves highlighting a 5% increase in NPV10 value for proved reserves. The estimated value for total proved reserves (PR) when discounted back at a 10% rate was $325 million ($3.27 per share) versus $308 million in the reserve from last year. The increase reflects higher West Canada Select oil prices in future years with the completion of the Trans Mountain Pipeline running from Alberta to the Pacific Coast. The value of proved developed producing (PDP) reserves rose 9% as the company was active drilling in 2023 and moving reserves into the PDP category.

The company was able to replace reserves reduced by production through drilling and acquisition. Hemisphere produced 1.1 mmboe in 2023 and added 1.0 mmboe of reserves through the drillbit or from acquisition. As a result, proved reserves were 12.1 mmboe in the most recent report versus 12.2 mmboe last year. The company spent $16 million to drill eight wells in addition to purchasing land and seismic. Just two years ago, capital expenditures were only $8 million. Finding, Development and Acquisition costs per proved reserve added in 2023 were $14.82/boe, an attractive price given current oil prices. 


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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. 

New Eli Lilly-Amazon Deal Signals Emerging Opportunities in Direct-to-Consumer Pharmaceuticals

Posted on by slightbourne@noblecapitalmarkets.com

The newly announced partnership between pharmaceutical giant Eli Lilly and e-commerce behemoth Amazon to enable direct-to-consumer medication delivery is sending shockwaves through the biotech and healthcare sectors. The deal, which allows customers to receive select Eli Lilly prescription drugs like diabetes, migraine, and weight-loss treatments via Amazon’s online pharmacy, represents a major shift in how pharmaceutical companies get products into the hands of consumers

For emerging biotech and healthcare companies watching this space, the Eli Lilly-Amazon partnership illuminates massive growth opportunities in the burgeoning direct-to-consumer pharmaceutical market. Cutting out the middlemen of insurance providers and brick-and-mortar pharmacies enables pharma companies to get closer to patients and potentially earn higher margins.

Under the partnership revealed this week, patients can receive Eli Lilly medications prescribed through the LillyDirect online platform or by their regular doctor, with Amazon handling the fulfillment and two-day delivery logistics. Axios’ Jacob Gardner points out this allows Eli Lilly “to reach more patients directly and sidestep more traditional pharmaceutical sales constraints.”

The collaboration helps both industry titans accomplish key objectives. For Eli Lilly, it expands their direct-to-consumer reach at a pivotal time following the approval of blockbuster weight-loss drug Zepbound last November. Amazon, meanwhile, continues growing its healthcare presence following the acquisition of PillPack and launch of Amazon Pharmacy in 2020.

Executives at emerging biotech and pharmaceutical companies would be wise to study this latest deal’s blueprint. By partnering with logistics giants like Amazon, FedEx, or UPS on the shipping side or digital health platforms on the consumer-facing end, they could unlock highly lucrative direct-to-consumer sales channels.

Beyond cutting out middlemen that take a cut of sales, direct-to-consumer pharma models can foster stronger patient relationships, bolster brand loyalty, and provide a wealth of data and analytics on consumer behaviors. Those insights allow companies to precisely tailor marketing and pricing strategies to drive further growth.

From the investor perspective, directly delivering cutting-edge treatments straight to patient doorsteps holds massive upside potential. Drug developers can keep more of the profits by circumventing insurance providers. But investing in the right direct-to-consumer pharmaceutical plays requires careful due diligence.

Investors need to scrutinize logistics capabilities, consumer marketing and branding strengths, and data analytics competencies in evaluating these emerging opportunities. The biggest winners will have a clear advantage in one or more of those mission-critical areas.

The overarching theme is clear – by cutting out the tangle of middlemen in the traditional pharmaceutical ecosystem, innovative companies embracing the direct-to-consumer model could potentially earn higher revenues, margins, and valuations. The ripple effects of the Eli Lilly-Amazon deal are likely just beginning for the healthcare investing space.

For investors willing to conduct thorough research and identify the pioneers, the emerging direct-to-consumer pharmaceutical market could birth the next generation of blockbuster biotech and healthcare companies.

Learn more about Noble Capital Markets’ Emerging Growth Virtual Healthcare Equity Conference on April 17-18 here.

Elevated Inflation Readings Complicate Fed’s Rate Cut Timeline

Posted on by slightbourne@noblecapitalmarkets.com

The Federal Reserve’s efforts to tame stubbornly high inflation are facing a fresh challenge, as new economic data released on Thursday showed price pressures are proving more persistent than expected. The latest inflation readings are likely to reinforce the central bank’s cautious approach to cutting interest rates and could signal that borrowing costs will need to remain elevated for longer in 2024.

The new inflation report came from the Labor Department’s Producer Price Index (PPI), which measures the prices businesses receive for their goods and services. The PPI climbed 0.6% from January to February, accelerating from the prior month’s 0.3% rise. Even more concerning for the Fed, core producer prices excluding volatile food and energy components rose 0.3% month-over-month, higher than the 0.2% increase forecast by economists.

On an annual basis, core PPI was up 2% compared to a year earlier, matching January’s pace but exceeding expectations. The stubbornly elevated core figures are particularly worrisome as the Fed views core inflation as a better gauge of underlying persistent price trends.

“Given the stickier than expected nature of inflation, it’s going to be very difficult for the Fed to justify a near-term rate reduction,” said Lindsey Piegza, chief economist at Stifel. “Our base case is that the Fed holds off to the second half of the year before initiating a change in policy.”

The hotter-than-anticipated producer inflation data follows a similarly elevated reading for consumer prices earlier this week. The Consumer Price Index showed core consumer inflation rose 3.8% over the past 12 months in February, also surpassing economist projections.

The back-to-back upside inflation surprises underscore the challenges the Fed faces in its efforts to wrestle price growth back down to its 2% target rate after it reached 40-year highs in 2022. Fed Chair Jerome Powell has repeatedly stressed that the central bank wants to see convincing evidence that inflation is moving “sustainably” lower before easing its monetary policy stance.

In the wake of Thursday’s PPI report, market expectations for the timing of a first Fed rate cut this year shifted slightly. The odds of an initial rate reduction happening at the June meeting dipped from 67% to 63% according to pricing in the fed funds futures market. As recently as earlier this year, many investors had anticipated the first cut would come as soon as March.

The Fed is widely expected to leave interest rates unchanged at the current 5.25%-5.5% range when it concludes its next policy meeting on March 22nd. However, officials will also release updated economic projections and interest rate forecasts, and there is a possibility some could scale back expectations for rate cuts in 2024 given the persistent inflation data.

In December, Fed policymakers had penciled in approximately three quarter-point rate reductions by year-end 2024 based on their median forecast. But the latest inflation figures cast doubt on whether that aggressive easing will ultimately materialize.

“This does leave a degree of uncertainty as to when they cut first and what they’ll do on the dot plot,” said Wil Stith, a bond portfolio manager at Wilmington Trust. “Will they leave it at three cuts or will they change that?”

Former Fed official Jim Bullard downplayed the significance of any single month’s inflation reading, but acknowledged the broad trajectory remains difficult for policymakers. “A little bit hot on the PPI today, but one number like this probably wouldn’t affect things dramatically,” he said.

With inflation proving more entrenched than hoped, the Fed appears set to maintain its policy restraint and leave interest rates at restrictive levels until incoming data provides clear and consistent evidence that the central bank’s battle against rising prices is being won. Consumers and businesses alike should prepare for higher borrowing costs to persist in the months ahead.