Great Lakes Dredge & Dock (GLDD) – Two New Awards


Monday, July 31, 2023

Great Lakes Dredge & Dock Corporation is the largest provider of dredging services in the United States. In addition, Great Lakes is fully engaged in expanding its core business into the rapidly developing offshore wind energy industry. The Company has a long history of performing significant international projects. The Company employs experienced civil, ocean and mechanical engineering staff in its estimating, production and project management functions. In its over 131-year history, the Company has never failed to complete a marine project. Great Lakes owns and operates the largest and most diverse fleet in the U.S. dredging industry, comprised of approximately 200 specialized vessels. Great Lakes has a disciplined training program for engineers that ensures experienced-based performance as they advance through Company operations. The Company’s Incident-and Injury-Free® (IIF®) safety management program is integrated into all aspects of the Company’s culture. The Company’s commitment to the IIF® culture promotes a work environment where employee safety is paramount.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , 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.

Two New Awards. Great Lakes was announced as the recipient of two awards by the Department of Defense last week, hopefully an indication of a return to a more normal award pace by the Army Corps of Engineers. In total, the two awards represent $36.7 million of new business for Great Lakes.

Award 1. Great Lakes was awarded a $20.7 million firm-fixed-price contract for Atchafalaya River basin maintenance dredging. Work will be performed in Morgan City, Louisiana, with an estimated completion date of February 15, 2024. Fiscal 2023 civil construction funds in the amount of $20.7 million were obligated at the time of the award.


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Cumulus Media (CMLS) – Some Hopeful Signs Total Revenues Are Stabilizing


Monday, July 31, 2023

Cumulus Media (NASDAQ: CMLS) is an audio-first media company delivering premium content to over a quarter billion people every month — wherever and whenever they want it. Cumulus Media engages listeners with high-quality local programming through 406 owned-and-operated radio stations across 86 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, CNN, the AP, the Academy of Country Music Awards, and many other world-class partners across more than 9,500 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through the Cumulus Podcast Network, its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. Cumulus Media provides advertisers with personal connections, local impact and national reach through broadcast and on-demand digital, mobile, social, and voice-activated platforms, as well as integrated digital marketing services, powerful influencers, full-service audio solutions, industry-leading research and insights, and live event experiences. Cumulus Media is the only audio media company to provide marketers with local and national advertising performance guarantees. For more information visit www.cumulusmedia.com.

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

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

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Q2 operating results. The company reported quarterly revenue of $210.1 million, in line with our estimate of $208.3 million.  While National/Network advertising remains weak, Local advertising has some greenshoots particularly with Digital Marketing Services revenue. Adj. EBITDA in the quarter was $28.7 million, beating our estimate of $21.8 million by an impressive 32%, excluding a $2 million nonrecurring benefit. The adj. EBITDA surprise was attributed to aggressive cost cutting efforts. 

Positive DMS outlook. Digital Marketing Services performed strongly, with revenue up 21% in the latest quarter. Management believes there is significant untapped growth potential in local DMSand is tripling its salesforce. Management anticipates an increase of 3x to 4x its current revenue run rate of $40 million in the next few years. 


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Travelzoo (TZOO) – Liftoff in Europe?


Friday, July 28, 2023

Travelzoo® provides its 30 million members with exclusive offers and one-of-a-kind experiences personally reviewed by our deal experts around the globe. We have our finger on the pulse of outstanding travel, entertainment, and lifestyle experiences. We work in partnership with more than 5,000 top travel suppliers—our long-standing relationships give Travelzoo members access to irresistible deals.

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

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

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

Solid Q2 results. The company reported better than expected revenue and adj. EBITDA in Q2. Revenue was $21.1 million and adj. EBITDA was $4.2 million, compared with our estimates of $20.5 million and $3.4 million, respectively. Revenue growth accelerated to 19% in Q2, compared with 17% growth in Q1.

Strong margins. Adj. EBITDA margins were up to nearly 20%, due in large part to 27% operating profit margins in the North America business segment. Operating profit in Europe, though, still negative, improved to nearly flat (-3%).


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Orion Group Holdings (ORN) – Post Call Commentary and Updated Models


Friday, July 28, 2023

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , 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.

Marine Segment. Marine segment revenue was up 22.1% y-o-y driven by the Hawaii contract. Segment operating profit rose to $3.5 million, or a 3.5% margin, from $2.5 million, or a 3.1% margin last year. Orion is winning new awards in the segment, but the Army Corps continues to award business at a slower than historical rate.

Concrete Segment. Revenue of $82 million declined from $112.3 million last year, partly due to the exit of the Central Texas market and partly due to stricter bidding by Orion as the Company seeks to improve overall segment margins. Second quarter operating loss was $1.4 million versus a loss of $5.4 million last year. The segment was profitable on an Adjusted EBITDA basis.


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Eskay Mining Corp. (ESKYF) – New Targets Increase the Potential for New Discoveries


Friday, July 28, 2023

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

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

Drilling has commenced. Eskay Mining has commenced this year’s diamond drill program at its 100% controlled Consolidated Eskay Gold Project in the Golden Triangle of British Columbia. The company’s exploration program is focused on precious metal-rich volcanogenic massive sulfide (VMS) deposits. Eskay Mining intends to complete up to 6,500 meters of core drilling. Closing the sale of five mining claims to Skeena Resources provided additional funding for the program.

Targets to be tested. Targets to be tested include: 1) Maroon Cliffs, 2) Hexagon-Mercury, 3) Tarn Lake, 4) Scarlet Knob, 5) Bruce Glacier, 6) Storie Creek, 7) Cumberland, and 8) TV South. Eskay recently started diamond drilling at the Tarn Lake target. A second drill is currently being mobilized to the site. These targets have been discussed by the company previously except for perhaps Bruce Glacier and Storie Creek.


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Orion Group Holdings (ORN) – Second Quarter First Look


Thursday, July 27, 2023

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , 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.

2Q Results. Contract revenues were $182.5 million, a 14.7% increase sequentially, but 6.2% decrease from last year. We estimated revenue at $174 million. Adjusted net loss for the quarter was at $4.5 million, or $0.14 per share, compared to an adjusted net loss of $0.92 million, or $0.03 per share, last year. Adjusted EBITDA was at $3.7 million from $5.7 million the prior year. We had estimated an adjusted net loss of $6.6 million, or $0.20 per share, and adjusted EBITDA of $2.8 million.

Improving from 1Q. Orion showed improvement from the Company’s first quarter results, including the 14.7% increase in revenues, and showed improvement in its Concrete business, as the segment turned profitable in March and has continued since. This, along with the flexibility in the Company’s balance sheet with the new ABL credit facility of $103 million and sale-leaseback transactions of $25 million and continued contracts wins, gives Orion catalysts for growth in the second half of the year and beyond, in our opinion.


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Euroseas (ESEA) – Euroseas extends two shipping contracts at favorable pricing


Wednesday, July 26, 2023

Euroseas Ltd. was formed on May 5, 2005 under the laws of the Republic of the Marshall Islands to consolidate the ship owning interests of the Pittas family of Athens, Greece, which has been in the shipping business over the past 140 years. Euroseas trades on the NASDAQ Capital Market under the ticker ESEA. Euroseas operates in the container shipping market. Euroseas’ operations are managed by Eurobulk Ltd., an ISO 9001:2008 and ISO 14001:2004 certified affiliated ship management company, which is responsible for the day-to-day commercial and technical management and operations of the vessels. Euroseas employs its vessels on spot and period charters and through pool arrangements.

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.

Euroseas terminated the charter of the Rena P and replaced it with a longer, fixed contract. The original contract earned a rate of $20,500/day until April 2024 and then shifted to indexed pricing with a $13,000 floor and a $21,000 ceiling through February 2025. Our  modeling had assumed rates drop to $15,000 in 2024. The new contract begins in August 2023 and extends 20-24 months (charter’s option) essentially adding 2-6 months to the contract and fixes the rate at $21,000. The new contract adds modestly to our 2024 earnings and cash flow.

Euroseas also replaced the Emmanual P contract with a longer, higher-priced contract. The new contract increases the rate to $21,000/day from $19,000 and extends the contract 1-5 months (charter’s option). The new contract also adds modestly to 2024 earnings and cash flow.


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Baudax Bio (BXRX) – Nasdaq Hearings Panel Grants Company Listing Request


Wednesday, July 26, 2023

Baudax Bio is a pharmaceutical company focused on innovative products for acute care settings. ANJESO is the first and only 24-hour, intravenous (IV) COX-2 preferential non-steroidal anti-inflammatory (NSAID) for the management of moderate to severe pain. In addition to ANJESO, Baudax Bio has a pipeline of other innovative pharmaceutical assets including two novel neuromuscular blocking agents (NMBs) and a proprietary chemical reversal agent specific to these NMBs. For more information, please visit www.baudaxbio.com.

Gregory Aurand, Senior Vice President, Equity Research Analyst, Healthcare Services & Medical Devices, Noble Capital Markets, Inc.

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

Determination letter received.  In a filing, Baudax Bio announced that, on July 24, 2023, the Nasdaq Hearings Panel issued a determination letter granting Baudax Bio’s request for continued Nasdaq listing, subject to the Company providing evidence of compliance with applicable conditions.

Conditions.  In May 2023, Nasdaq issued a delisting determination of BXRX stock unless the Company timely requested a hearing before the Nasdaq Hearings Panel, which the Company did. The delisting determination was based upon the Company evidencing a closing bid price of less than $1.00 per share and stockholders’ equity of less than $2.5 million.  As a reminder, Baudax Bio announced a merger with TeraImmune, Inc. on June 30, 2023, and  the Company is working to comply with the terms of the Hearing Panel’s decision, which also includes holding a special shareholder meeting seeking approval to convert preferred shares issued to TeraImmune, Inc. to common shares and implementation of a reverse stock split, if necessary. The special shareholder meeting date is yet to be determined but will likely be in September, after 30 day SEC review of the merger transaction.  


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Tonix Pharmaceuticals (TNXP) – New Tianeptine Data In Memory and Cognition Announced


Tuesday, July 25, 2023

Tonix is a clinical-stage biopharmaceutical company focused on discovering, licensing, acquiring and developing therapeutics and diagnostics to treat and prevent human disease and alleviate suffering. Tonix’s portfolio is composed of immunology, rare disease, infectious disease, and central nervous system (CNS) product candidates. Tonix’s immunology portfolio includes biologics to address organ transplant rejection, autoimmunity and cancer, including TNX-15001 which is a humanized monoclonal antibody targeting CD40-ligand being developed for the prevention of allograft and xenograft rejection and for the treatment of autoimmune diseases. A Phase 1 study of TNX-1500 is expected to be initiated in the second half of 2022. Tonix’s rare disease portfolio includes TNX-29002 for the treatment of Prader-Willi syndrome. TNX-2900 has been granted Orphan-Drug Designation by the FDA. Tonix’s infectious disease pipeline includes a vaccine in development to prevent smallpox and monkeypox called TNX-8013, next-generation vaccines to prevent COVID-19, and an antiviral to treat COVID-19. Tonix’s lead vaccine candidates for COVID-19 are TNX-1840 and TNX-18504, which are live virus vaccines based on Tonix’s recombinant pox vaccine (RPV) platform. TNX-35005 (sangivamycin, i.v. solution) is a small molecule antiviral drug to treat acute COVID-19 and is in the pre-IND stage of development. TNX-102 SL6, (cyclobenzaprine HCl sublingual tablets), is a small molecule drug being developed to treat Long COVID, a chronic post-acute COVID-19 condition. Tonix expects to initiate a Phase 2 study in Long COVID in the second quarter of 2022. The Company’s CNS portfolio includes both small molecules and biologics to treat pain, neurologic, psychiatric and addiction conditions. Tonix’s lead CNS candidate, TNX-102 SL, is in mid-Phase 3 development for the management of fibromyalgia with a new Phase 3 study launched in the second quarter of 2022. Finally, TNX-13007 is a biologic designed to treat cocaine intoxication that is expected to start a Phase 2 trial in the second quarter of 2022. TNX-1300 has been granted Breakthrough Therapy Designation by the FDA.

Robert LeBoyer, Senior Vice President, Equity Research Analyst, Biotechnology, Noble Capital Markets, Inc.

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

New Tianeptine Data In Memory and Cognition. Tonix announced new preclinical findings for tianeptine, the active molecule in two pipeline products. The two products are TNX-601 EP, in development for major depressive disorder, and TNX-4300, in preclinical development for Alzheimer’s disease, Parkinson’s disease, and mood disorders.  The TNX-601 Phase 2 UPLIFT trial is expected to release results in 1Q24.

New Data Supports Previous Tianeptine Findings. As discussed in our Research Note on May 30, Tonix presented data showing that tianeptine restores neuronal sprouting and reconnections in cell culture. The data showed its two isomers have different targets, with the (S)-isomer affecting neuroplasticity, and the (R)-isomer binding to the mu-opioid receptor and causing undesirable off-target effects. A new molecule, TNX-4300 or estianeptine, was developed as a purified version containing only the (S)-isomer.


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Great Lakes Dredge & Dock (GLDD) – Notice to Proceed Received on Great Lakes’ Largest Contract Ever


Tuesday, July 25, 2023

Great Lakes Dredge & Dock Corporation is the largest provider of dredging services in the United States. In addition, Great Lakes is fully engaged in expanding its core business into the rapidly developing offshore wind energy industry. The Company has a long history of performing significant international projects. The Company employs experienced civil, ocean and mechanical engineering staff in its estimating, production and project management functions. In its over 131-year history, the Company has never failed to complete a marine project. Great Lakes owns and operates the largest and most diverse fleet in the U.S. dredging industry, comprised of approximately 200 specialized vessels. Great Lakes has a disciplined training program for engineers that ensures experienced-based performance as they advance through Company operations. The Company’s Incident-and Injury-Free® (IIF®) safety management program is integrated into all aspects of the Company’s culture. The Company’s commitment to the IIF® culture promotes a work environment where employee safety is paramount.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , 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.

NextDecade NTP. Great Lakes received a Notice to Proceed from NextDecade Corporation for essential improvements to the Brownsville Ship Channel for NextDecade’s Rio Grande LNG project. Although the value of the contract was not specified, management noted the project is the largest undertaken by Great Lakes’ in the Company’s 133-year history, with the previous record project approximately $270 million. The project is expected to begin later in 2023.

Details. The work includes deepening the entrance channel to the western end of the RGLNG property also known as Phase 1 of the Brazos Island Harbor Channel Improvements. This also includes the development of two ship berths and turning basin for the Rio Grande LNG facility. This project will enhance commercial navigation into and out of the Port of Brownsville and ensure the safe and reliable access of LNG carriers to the Rio Grande LNG facility.


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Aurania Resources (AUIAF) – Maintaining a Firm Footing in Ecuador with an Eye Toward France


Tuesday, July 25, 2023

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

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

Looking ahead. Through a wholly owned French subsidiary, Aurania Resources applied for an exploration license in the Brittany Peninsula of northwestern France. The concession area has historically been the site of significant high-grade gold finds. Aurania’s interest in the area is attributed to the discovery of several exceptionally high-grade gold samples, two on display at the Natural History Museum in Paris and one in the possession of a private collector, from the same locale. A December 2022 visit to the place of origin revealed abundant quartz vein material on surface along with evidence of mining activity in the 1800s.

Reaching an accommodation in Ecuador. On July 31, Dr. Keith Barron, Aurania’s CEO, will meet with Ecuador’s Minister of Energy and Mines to discuss options to recover concessions that were initially applied for in 2016 but not granted. Because the concessions were initially held in reserve for Aurania, the company conducted airborne geophysics that revealed over 100 discrete magnetic porphyry type targets in the concession area held in reserve. Please refer to our research noted dated June 16, 2023 for more detail.


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Kelly Services (KELYA) – Restructuring for Growth


Friday, July 21, 2023

Kelly (Nasdaq: KELYA, KELYB) connects talented people to companies in need of their skills in areas including Science, Engineering, Education, Office, Contact Center, Light Industrial, and more. We’re always thinking about what’s next in the evolving world of work, and we help people ditch the script on old ways of thinking and embrace the value of all workstyles in the workplace. We directly employ nearly 350,000 people around the world and connect thousands more with work through our global network of talent suppliers and partners in our outsourcing and consulting practice. Revenue in 2021 was $4.9 billion. Visit kellyservices.com and let us help with what’s next for you.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , 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.

Plugging the Holes. Kelly Services announced yesterday that the Company is undergoing strategic restructuring actions that will further optimize the company’s operating model to enhance organizational efficiency and effectiveness. This is part of the Company’s initiative to drive EBITDA margin improvement and accelerate long-term profitable growth announced in May.

The Strategy. Kelly will be realigning business-critical resources to Kelly’s business units, streamline corporate resources, reduce redundant organizational layers, and optimize work processes with this restructuring. These structural changes simplify the Company’s operations and unlock additional resources to invest in growth. The Company has already implemented a workforce reduction plan.


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Haynes International (HAYN) – Lowering Near-Term Estimates; Outlook Remains Favorable


Friday, July 21, 2023

Haynes International, Inc. is a leading developer, manufacturer and marketer of technologically advanced, nickel and cobalt-based high-performance alloys, primarily for use in the aerospace, industrial gas turbine and chemical processing industries.

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

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

Network outage disrupts shipments. Beginning on June 10th, Haynes experienced a cyber-driven network outage that negatively impacted the company’s operations and caused delays in product shipments. By June 21st, the company’s manufacturing operations were restored along with substantially all administrative, sales, financial, and customer service functions.

Third quarter company guidance. Haynes estimates that net revenues for the quarter were impacted by approximately $18 million to $20 million resulting in third quarter net sales of $142 million to $145 million. Lower production compressed gross margin and earnings were also impacted by costs associated with the investigation and restoration efforts. In total, Haynes estimates the full earnings impact to be in the range of $0.40 to $0.45 per share. Additionally, the negative impact from raw material fluctuations, primarily for cobalt, is estimated to have a negative earnings impact of $0.09 per share. The company estimates third quarter earnings per share will be in the range of $0.65 to $0.70.


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