Research – Seanergy (SHIP) – Focus on Weak Cape Market and Upcoming Refinancing

Friday, February 14, 2020

Seanergy (SHIP)

Focus on Weak Cape Market and Upcoming Refinancing

Seanergy Maritime Holdings Corp., an international shipping company, provides marine dry bulk transportation services through the ownership and operation of dry bulk vessels. Seanergy Maritime Holdings Corp. is the only pure-play Capesize shipping company listed in the US capital markets. Seanergy provides marine dry bulk transportation services through a modern fleet of 10 Capesize vessels, with total capacity of approximately 1,748,581 dwt and an average fleet age of about 9.8 years. The Company is incorporated in the Marshall Islands with executive offices in Athens, Greece and an office in Hong Kong. The Company’s common shares trade on the Nasdaq Capital Market under the symbol “SHIP” and class A warrants under “SHIPW”.

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

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

4Q2019 operating results were higher than our recently revised estimates. EBITDA of $11.9 million, TCE rates of $22.9k/day and EPS of $0.08 were above expectations.

Dry bulk market weakness impacts 2020 estimate. The early part of the year has been weaker than expected and our new EBITDA estimate is $27.2 million based on TCE rates of $15.3k, down from our previous estimate of…



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Research – Newrange Gold Corp (NRG:CA) – Striking Gold with District-Scale Projects in Nevada and the Red Lake Region of Ontario

Friday, February 14, 2020

Newrange Gold Corp (NRG:CA)

Striking Gold with District-Scale Projects in Nevada and the Red Lake Region of Ontario

Newrange Gold Corp is an exploration stage company focused on acquiring and exploring exploration and evaluation assets in Colombia and the United States. The Company operates in a single reportable operating segment-the acquisition, exploration, and development of mineral properties. Some of the projects acquired by the company are Pamlico gold project in Nevada and Rocky mountain project in Colorado. The company also holds an interest in the Yarumalito property, El Dovio property and Anori property in Colombia.

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

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

Initiating coverage with an Outperform rating. We are initiating coverage of Newrange Gold Corp. with an investment rating of Outperform and a price target of C$0.25 per share. In our view, the equity offers investors exposure to an early-stage exploration mining company with significant gold and silver discovery potential.

Pamlico and North Birch projects represent significant upside for investors. The Pamlico project, located in Nevada, represents a unique opportunity to explore and develop a district-scale gold deposit in multiple target areas across the property. While the company recently optioned its North Birch project, located in the Red Lake region of Ontario, Canada, we view the property as a hidden gem as its potential remains to be unlocked with the…



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NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
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Research – The McClatchy Company (MNI) – What happened?

Friday, February 14, 2020

The McClatchy Company (MNI)

What happened?

The McClatchy Company publishes news and information in the United States. Its publications include the Miami Herald, The Kansas City Star, The Sacramento Bee, The Charlotte Observer, The (Raleigh) News and Observer, the (Fort Worth) Star-Telegram, and The (Durham, NC) Herald-Sun. The companyÂ’s businesses comprise daily newspapers, Websites, mobile apps, mobile news and advertising, video products, niche publications, direct marketing, direct mail services, and nearby community newspapers. The McClatchy Company was founded in 1860 and is headquartered in Sacramento, California.

Michael Kupinski, Senior Research Analyst, Noble Capital Markets, Inc.

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

Files for voluntary Chapter 11. There was an outside chance that the company would be able to move unfunded pension liabilities off balance sheet and do a reorganization that would leave some equity value for shareholders. This did not happen. Less favorable terms from the Pension Benefit Guaranty Corporation (PBGC) may have tipped the company’s decision.

Submits plans for a reorganization. The company plans to go private in a transaction that will swap a large portion of its debt for equity. Given the prospect of moving all but a small portion of its unfunded pension liability off its balance sheet, the company could have a moderate $299 million in long term debt and…



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Research – Kelly Services Inc. (KELYA) – Can the New Growth Plan Work?

Friday, February 14, 2020

Kelly Services Inc. (KELYA)

Can the New Growth Plan Work?

Kelly Services Inc is a provider of workforce solutions and consulting and staffing services. The company’s operations are divided into three business segments namely Americas Staffing, Global Talent Solutions (“GTS”) and International Staffing. It provides staffing solutions through its branch networks in Americas and International operations and also provides a suite of innovative talent fulfilment and outcome-based solutions through GTS segment. Americas Staffing generates maximum revenue from its operations.

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

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

New Growth Strategy. New CEO Peter Quigley is rolling out a new, aggressive organic and inorganic growth plan to build a sustainable and profitable specialty talent solutions provider. We believe Kelly has the means, capability, and opportunity to successfully implement the plan.

4Q19 Results.  Fourth quarter results were mixed. Revenue fell short of expectations due to ongoing softness in select U.S. niches, continued disruption from the early 2019 restructuring of U.S. operations, and economic headwinds in Europe. However, better mix lead to improved gross margin and…



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Research – EuroDry Ltd. (EDRY) – Solid Quarter and Well Positioned for Expected 2H2020 Recovery

Friday, February 14, 2020

EuroDry Ltd. (EDRY)

Solid Quarter and Well Positioned for Expected 2H2020 Recovery

EuroDry Ltd. was formed on January 8, 2018 under the laws of the Republic of the Marshall Islands and trades on the NASDAQ Capital Market under the ticker EDRY. EDRY is the product of a spin-off of the dry bulk fleet by Euroseas (ESEA) completed in May 2018. For every five ESEA shares, ESEA shareholders received one EDRY share. There are currently ~2.2 million EDRY shares outstanding. EuroDry operates in the dry bulk shipping markets. EuroDry’s operations are managed by Eurobulk Ltd., an affiliated ship management company, and Eurobulk FE (Far East) Ltd, which are responsible for the day-to-day commercial and technical management and operation of the fleet. EuroDry employs the fleet on spot and period charters and through pool arrangements.

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

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

Another solid quarter as pure dry bulk play.  Adjusted 4Q2019 EBITDA of $3.8 million was above our estimate of $2.8 million mainly due to higher than expected TCE rates and and lower opex.

Lowering 2020 estimates.  Due to dry bulk market weakness, we are moving adjusted 2020 EBITDA estimate lower to $11.5 million based on TCE rates of $11,671/day down from $13.4 million based on TCE rates of $12,622/day. Given the current dry bulk market environment, we are forecasting that TCE rates weaken slightly in 1H2019 from 4Q2019 levels. There was limited change in the contract status, but one longer term contract will move from a fixed rate to indexed rate in 1Q2020 and…



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Renaissance in Inflammasome Therapeutics

Noblecon16  Panel is set to Discuss Recent Breakthroughs in Inflammasome Space

There is an ongoing renaissance in the potential for drugs targeting a unique inflammation hub, inflammasome. Inflammasomes are crucial to coordinate in?ammatory responses.  Inflammation is a protective immune response to harmful stimuli, such as pathogens, dead cells or irritants, and is tightly regulated by the host. The innate immunity is the first line of defense in recognition of infection and initiation of clearance by the host. The activation of the inflammasome is a key function mediated by the innate immune system. Three main domains comprise inflammasomes: sensor molecule, adaptor protein (ASC), and effector protein mainly pro-caspase 1.

Oligomerization (generation of multi-molecular complex of inflammasome) is triggered by danger associated molecular patterns (DAMPs) or pathogen-associated molecular patterns (PAMPs) that results in effector activation and leading to maturation of procytokines and pyroptosis, a form of inflammatory cell death. The nucleotide-binding domain-like receptor (NLR) family is the main group of proteins considered as inflammasome sensors. Inflammasome sensor proteins are involved in the recognition of particular danger stimulus and then initiate the assembly of inflammasome multimeric complex. Among NLR family (NLRs—NLRP1, NLRP2, NLRP3, and NLRC4, nonNLRs—absent in melanoma 2 (AIM2) and pyrin), NLRP3 recognizes the largest array of stimulus and it is the most studied in terms of developing NLR inhibitors. The adaptor proteins are known as apoptosis-associated speck-like protein (ASC) containing a caspase activation and recruitment domain (CARD). In response to PAMPs or DAMPs, the sensor molecule recruits ASC, which recruits pro-caspase 1. This interaction converts pro-caspase-1 into its activated form, caspase-1. Caspase-1 then cleaves the proforms of IL-1ß and IL-18 into their mature forms, which triggers the inflammatory process, which can induce cell death via a process known as pyroptosis (Exhibit 1). The release of IL-1ß and IL-18 leads to the activation of several downstream pathways that further assist in the inflammatory process.

Exhibit 1. The inflammasome mechanism of action

Source:
Hoffman and Broderick, J Allergy Clin Immunol, 2016

While insufficient inflammation can lead to persistent infection of pathogens, excessive inflammation can cause chronic or systemic inflammatory diseases. Inflammasomes play a crucial role in mediating inflammation and therefore serve as potential drug targets for the treatment of inflammatory-mediated diseases. Inflammasomes have been associated with variety of autoinflammatory and autoimmune diseases, including neurodegenerative diseases (multiple sclerosis, Alzheimer’s disease, and Parkinson’s disease) and metabolic disorders (atherosclerosis, type-2 diabetes, and obesity). Currently, there are no approved inflammasome inhibitors; however, there are several early stage assets in the pipeline. While most companies are targeting the sensor molecule (NLRP3), some others are taking a unique approach targeting either the adaptor protein (ASC) or other molecules.

 

Exhibit 2. Recent selected deals in inflammasome space

At least, four biotechnology firms with NLRP3 inhibitors have been founded in the last four years. In 2018, they raised a collective $117 million in venture capital. Inflazome was recently granted over US$1M in funding from The Michael J. Fox Foundation for Parkinson’s Research (MJFF). High activity in inflammasome space was seen in the recent years. Among the multiple M&A and partnership deals, the majority of them were at preclinical stage. The transaction volume varied, $160 mm – $1.6 billion (Exhibit 2). Multiple acquisitions in the field show the first inflammasome target -NLRP3 -is gaining momentum. The question remains how fast the best set of indications can be identified from the sea of possibilities.

Selected Companies Targeting Inflammasome

Highlighted below the Inflammasome Panel
attendees and selected companies with current programs in inflammasome
therapeutics (alphabetical order).

Inflammasome Inhibitors: The Next Generation of
Innovative Immunotherapy Agents
Monday, February 17 – 10:00am – 11:00am – Terrace Ballroom B

  • Paul Ashton, PhD., Co-Founder & CEO of Inflammasome Therapeutics, Inc.
  • Gary Glick, PhD., Co-Founder & Executive Chairman of IFM Therapeutics and Michigan Professor of Chemistry
  • Steve Glover, Co-Founder, President & CEO of Zyversa Therapeutics, Inc.
  • Robert W. Keane, PhD., Professor Physiology & Biophysics, Neurological Surgery & Microbiology, and Immunology at the University of Miami, and co-founder of InflamaCore, LLC
  • Clay B. Thorp, General Partner at Hatteras Venture Partners

IFM Therapeutics (Private
company)

IFM Therapeutics (IFM) is a Boston-based, a privately held biopharmaceutical company focused on developing novel therapies that regulate the innate immune system. IFM was formed following the acquisition of the original IFM Therapeutics by Bristol-Myers Squibb in 2017 ($1.3 billion). IFM has a unique approach in regulating the management of its research and development activities. IFM has separate subsidiaries that are responsible for a particular set of programs. While each subsidiary is financially independent, they share common infrastructure and resources. IFM has established three subsidiaries: IFM Tre was launched in July 2018 and was subsequently acquired by Novartis in May 2019, IFM Due, which launched in February 2019, and the most recent, IFM Quattro launched in Dec 2019.

 IFM’s inflammasome platform is based on antagonists of NLR proteins for inflammation-mediated diseases (such as, Alzheimer’s, liver fibrosis/non-alcoholic steatohepatitis (NASH), and type 2 diabetes) and anti-cancer agents for modulating the tumor environment. IFM currently has two NLRP3 antagonists in the preclinical stage and one NLRP3 antagonist in Phase 1 for the treatment of inflammation, fibrosis, neuroinflammation. The rights of the above molecules belong to Novartis. IFM has another NLRP3 agonist, an anti-cancer agent, owned by Bristol-Myers Squibb.

Inflammasome Therapeutics
(Private company)

Inflammasome therapeutics is developing therapies for Alzheimer’s, multiple sclerosis, macular degeneration, and type 2 diabetes by averting unusual inflammasome activation. They have identified and licensed a series of molecules known as Kamuvudines. The company has presented and published favorable preclinical data and recently established partnership with Boehringer Ingelheim to co-develop up to three therapies for patients with retinal diseases. Based on the agreement, Inflammasome is entitled to receive up to $160 million in up-front, research and development support and milestone payments and royalties based on future commercial sales of the products.

Inflazome (Private company)

Inflazome is a clinical stage biotechnology company that specializes in developing a NLRP3 small-molecule targeting inflammatory mediated diseases. The company received a grant in October 2019 from The Michael J. Fox foundation for the development of a NLRP3-specific Positron Emission Tomography (PET) tracer to allow non-invasive imaging of inflammasome-driven inflammation in the brain. Inflazome also completed a $46 million Series B funding in 2018. Inflazome’s lead asset Inzomelid is a potent, selective, brain penetrant NLRP3 inhibitor that is currently in Phase Ib trials. Inzomelid is indicated for the treatment of neuroinflammatory and neurodegenerative diseases such as Parkinson’s, Alzheimer’s and Motor Neuron Disease as well as the orphan disease CAPS. The second is Somalix, a potent, selective, peripherally restricted NLRP3 inhibitor that is currently in Phase I trials indicated for the treatment of arthritis and cardiovascular diseases. Clinical trial data are not available at this time.

Nodthera (Private company)

Nodthera is an early-stage biopharmaceutical company developing novel NLRP3 inhibitors for the treatment of NASH, pulmonary fibrosis, neurodegenerative disorders, and inflammatory bowel disease (IBD). The company’s lead candidate NT-0167 is currently under pre-IND stage. Nodthera completed a $40 million Series A funding in 2018.

Zyversa Therapeutics, Inc (Private
company
)

Zyversa is a clinical stage biopharmaceutical company developing first-in-class therapeutics for inflammatory (e.g., multiple sclerosis and NASH) and renal (e.g., diabetic nephropathy and lupus nephritis) diseases. Zyversa’s lead inflammasome targeting agent is IC 100, a monoclinal antibody targeting ASC for the treatment of multiple sclerosis. The company licensed IC 100 from InflamaCORE. Preclinical studies suggest that IC 100 inhibits the downstream inflammatory pathways. IC 100 is a nonspecific ASC inhibitor, which has a wide therapeutic range potentially inhibiting various types of inflammasomes. Zyversa has three additional ASC inhibitors under development for Lupus Nephritis, NASH, and diabetic kidney disease.

Research acco brands corporation acco post 4q call review basic blocking tackling

Thursday, February 13, 2020

ACCO Brands Corporation (ACCO)

Post 4Q Call Review: Basic Blocking & Tackling

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

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

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

Blocking & Tackling. ACCO continues to do the basic blocking and tackling. The Company’s strategy of focusing on growing channels, strong brands, innovative products, and productivity improvements, complemented by accretive acquisitions is working, in our view.

New Product Introductions a Positive. New product revenue grew substantially in the fourth quarter, a positive development. With new product introductions normally taking at least 3 years to hit peak revenue, we are encouraged these higher margin products will become…




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Research therapeuticsmd inc- txmd pre q4 overview adjusting our earnings estimates

Thursday, February 13, 2020

TherapeuticsMD Inc. (TXMD)

Pre-Q4 Overview: Adjusting Our Earnings Estimates

(current) TherapeuticsMD, Inc. is a women’s healthcare company focused on developing and commercializing products targeted exclusively for women. It manufactures and distributes branded and generic prescription prenatal vitamins, as well as over-the-counter vitamins and cosmetics, under our vitaMedMD’ and BocaGreenMD’ brands. The company is currently developing advanced hormone therapy pharmaceutical products designed to alleviate the symptoms of and reduce the health risks resulting from menopause-related hormone deficiencies. It is also evaluating various other potential indications for our hormone technology, including oral contraception, preterm birth, vulvar and vaginal atrophy, and premature ovarian failure.

Ahu Demir, Ph.D., Biotechnology Research Analyst, Noble Capital Markets, Inc.

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Overview. Prior to fourth quarter earnings reporting, we are updating our estimates and wanted to convey our latest thoughts on the company. In this report, we disclose our estimates for each product, having previously reported total revenue numbers. Our investment thesis remains unchanged as we see healthy volume growth and believe all the products are well positioned in the women’s health space.

Our fourth-quarter estimates for the three commercial products. The company transitioned to commercial state following launches of three products (Imvexxy, Bijuva and Annovera) in 2018-2019. The total revenues from these products reached $10.9 mm in the 9-months of 2019; ($9.9 mm from Imvexxy, $0.6 mm from Bijuva, and $0.4mm from Annovera). We are forecasting $6.7 mm sales for Imvexxy, $1.1 mm for Bijuva and…




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Free Markets, National Security, Global Competition, and 5G

The Other 5G Controversy

(Note: companies that
could be impacted by the content of this article are listed at the base of the
story [desktop version]. This article uses third-party references to provide a
bullish, bearish, and balanced point of view; sources are listed after the
Balanced section.)

In an article dated February 4, 2020, The Wall Street Journal reported that the White House is working with U.S. technology companies to create advanced software for next generation 5G telecommunication networks in order to counteract the dominance of China’s Huawei Technologies, which holds a leading share of the market for 5G wireless equipment.  Huawei is a Chinese global provider of information and communications technology infrastructure and smart devices.  It has faced skepticism in various markets, notably the United States and in Europe, that reliance on its infrastructure equipment could pose cybersecurity threats.  With the importance of 5G wireless technology for digital cellular network development, many believe that the United States and its allies should discourage the use of components manufactured by Huawei or other companies subject to influence by adversarial foreign powers.  On February 6, 2020, U.S. Attorney General Bill Barr went so far as to suggest that the United States government and its allies should purchase controlling stakes in Ericsson and Nokia to help build stronger international competitors to Huawei.  While Huawei has been the center of controversy, the central issue is one of ensuring global supply chains and technology are reliable and uncompromised.  Should the U.S. and its allies disqualify Huawei in the 5G race?  

Pros:

Huawei could represent a threat to national security.  Because of their faster speed and broader application, 5G networks could play a role in managing sensitive data and critical infrastructure.  It is only fair to ask which companies should be supplying the technology.  Some believe links between Huawei and the Chinese government represent a threat and could allow the Chinese government to advance its objectives at the expense of democracy, particularly in times of conflict.

Huawei represents a competitive threat.  Huawei has been aggressively winning market share globally as a supplier of 5G technology.  The company’s dominant position in the large Chinese market already positions them with a significant share of the global market.  There is a risk that as they gain greater market share globally, Huawei will enjoy greater economies of scale and supply chains relied upon by non-Huawei customers could be disadvantaged.

Privacy concerns.  Some are concerned that the Chinese government enjoys access to all data held by Chinese companies and that Huawei represents a threat to the privacy and security of communications and data.  According to a February 2019 article in Forbes, Robert Strayer, Deputy Assistant Secretary for Cyber and International Communications and information Policy at the U.S. State Department, is worried that a country that uses data in the way China has, including to surveil its citizens, should give one pause about the way that country might use data in the future.  

Taking a stand together.  While the United States and its allies don’t always agree, taking the lead in 5G development could represent an opportunity for the United States and its allies to collaborate and support technology innovation that benefits democratic nations and their stakeholders.

Cons:

Government has no business picking winners and losers.  Some believe that governments have a poor track record of private sector intervention and have no business picking winners and losers.  They believe that private enterprise tends to generate more effective solutions in a free market economy.  The Houston Chronicle reported that Trump economic advisor Larry Kudlow pushed back on the Attorney General’s proposal by stating that “the U.S. Government is not in the business of buying companies, whether they’re domestic or foreign.” 

Government involvement could stifle innovation.  Rather than being propped up with government intervention, companies tend to be more innovative in a competitive environment.  During an interview on CNBC’s Squawk Box which aired on February 7, 2020, Randall Stephenson, AT&T CEO stated that he did not think it is a good idea for governments to be taking positions in private companies to develop private solutions and thought that governments had not demonstrated a good track record in this regard.  Mr. Stephenson thought it was better to use innovation such as software solutions or software defined architecture to win rather than rely on government mandates to win.  According to an article in the Houston Chronicle, Vice President Mike Pence believes that the “best way forward” on 5G relies on private enterprise and not government takeovers.

Threat of retaliation.  The Chinese Embassy in France recently released a statement that it had noted recent report in several French media that authorities were planning to take restrictive measures against Huawei in the deployment of 5G in France.  The Embassy issued a veiled threat by stating that it does not want to see the development of European companies in the Chinese market affected because of the discrimination and protectionism of France and other European countries towards Huawei. 

Balanced:

While the issues of national security and ensuring the global competitiveness of companies based in the United States and in allied countries that supply critical products and services are valid, how to best achieve both objectives is subject to debate.  While the idea of the U.S. government purchasing ownership stakes in companies that compete with Huawei represent one extreme, there are many paths to reduce customer reliance on one suppler avenues.  According to the Wall Street Journal, one proposal is to have U.S. telecommunications and technology companies establish common engineering standards that would allow 5G software developers to run code on equipment from almost any hardware manufacturer thus separating software from hardware versus integrated equipment.  Thus, the best path forward for 5G will likely entail greater public and private collaboration rather than direct government intervention with the government doing its part to ensure free and fair trade, including protecting intellectual property rights.       

Sources:

U.S.
Pushing Effort to Develop 5G Alternative to Huawei
, Wall Street Journal, Bob Davis and Drew FitzGerald, February 4, 2020.

Barr’s
Call for U.S. Control of 5G Providers Quickly Rebuked
, Associated Press, Tali Arbel, February 7, 2020.

Corporate Information, Huawei corporate website, 2020.[m1] 

Why
is 5G Important?
Verizon.com, Personal Tech, November 5, 2019.

Barr
Urges US Stakes in Nokia and Ericsson to Stall Huawei, Financial Times
, Kadhim Shubber and Kiran Stacey, February 6, 2020.

Huawei
Security Scandal: Everything You Need to Know
, Forbes, Kate O’Flaherty, February 26, 2019.

We’ll
Never Make Huawei ‘Safe’.  It Must be
Stripped from UK Networks as Quickly as Possible
, The Telegraph, Iain Duncan Smith, February 9, 2020.

Statement
by the Spokesperson of the Chinese Embassy in France on the question of Huawei
and 5G
, Chinese Embassy in France, February 9, 2020.

China
Just Issued Stark New Threats Over Huawei: This Time Nokia and Ericsson Are in its
Sights
, Forbes, Zak Doffman, February 9, 2020.

AT&T’s
Stephenson Stands by Promise to Remain CEO Through 2020 But Refuses to Look
Beyond That
, CNBC Interview, Squawk Box, Matthew J. Belvedere, Joe Kernan and Beck Quick, February 7, 2020.

Valentine’s Day by the Numbers

The Business of Valentine’s Day – Insight from a Consumer Gift Success Story

(Note: companies that
could be impacted by the content of this article are listed at the base of the
story [desktop version]. This article uses third-party references to provide a
bullish, bearish, and balanced point of view; sources are listed after the
Balanced section.)

While the gift-giving season may be in full bloom between Thanksgiving and Christmas, gifts of the blooming variety are most often given on Mother’s Day and Valentines’. In the category of flower purchases, historically, more orders are taken for Mother’s Day, but people spend more per order on Valentines. 

According to information from 1 800-FLOWERS.com Inc., Valentine’s Day represents 10% of its revenue from consumer floral during the year. In total last year, they had annual flower sales of approximately $500 million, so roughly $50 million in floral transactions are expected to occur during each second week in February.  This represents a third of revenue from their floral sales during the quarter. The majority of revenue for the quarter falls in the category of “everyday occasions.”

Using trends from prior years, the median gift-giver will be spending, on average, $196. This amount is for the full gamit of possible gifts. Greeting cards are staples for almost all consumers. Additionally, an evening out, candy, and jewelry are popular Valentine’s gifts and activities. It’s expected that 20% of celebrants will be giving jewelry to their Valentine on the 14th.   

The gender make-up of customers ordering is 80% male and 20% female. This year, the romantic holiday falls on a Friday which boosts holiday sales — more people participate. However, there is then a higher percentage who opt to go to dinner or out on the town rather than give a physical gift. Restaurants do better on years where Valentine’s is part of a weekend.

This Valentine’s Day, 1-800-Flowers.com anticipates it will sell 18.5 million flowers, 11 million (60%) are expected to be roses.  A little more than 65% of orders will be sent from mobile phones. The closer to V-day, the more likely the order will be made (last minute) through a handheld device. Although this mobile 65% is a majority of orders, it represents only about 45% of revenue. Both of these numbers have been on a positive trend over the years.

Recently there has been a change to where purchasers ask for flowers to be delivered. Flowers are now more often sent to the office where the recipient works. This is best when the holiday falls on a workday, it allows the gift to be appreciated by even more people.

What’s New?

Spending across the board for Valentine’s Day 2020 is expected to be $27 billion. This would be a 32% increase over 2019. The average order will be higher than in the past as people are more willing to spend in a booming economic environment.

1800-flowers.com would seem to be a confusing name for an online business. Or,  a name where one would not think to buy food, stuffed animals, holiday decorations, or other gifts. The reason for this seeming disconnect is their evolution. Management has, since 1976, aggressively stayed ahead of trends and technology by implementing those that could help their business. One decade this may have meant embracing an “800-number” another may have meant embracing “dot-com” commerce. They made these transitions without letting go of the brand that had been built up to that point.

Product improvement and exclusivity is part of staying ahead. This can be seen today with their trademarked “Magnificent Roses.” These are preserved roses that arrive and are presented in one of many unique options. A long-lasting gift is a high-priced option that is relatively new.  The preserved roses have been gaining in popularity, and despite the cost, are expected to be a top seller for the online retailer this year.  They also take many orders for food baskets and other edibles. Orders for chocolate-covered strawberries are most brisk during both Valentine’s and Mother’s Day. 

A strong economy always helps businesses where purchases are primarily discretionary. This year Jewelry stores, restaurants, perfume manufacturers, chocolatiers, and florists are expecting a lot of “love” from their customers.

 

 

1-800 Flowers.com Inc. Second Quarter Discover Report via
Channelchek

How
1-800-Flowers.com became one of the biggest, clunkiest names in Valentine’s Day
gifts

Suggested Reading:  Thirty-Something
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Research – ACCO Brands Corporation (ACCO) – Post 4Q Call Review: Basic Blocking & Tackling

Thursday, February 13, 2020

ACCO Brands Corporation (ACCO)

Post 4Q Call Review: Basic Blocking & Tackling

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

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

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

Blocking & Tackling. ACCO continues to do the basic blocking and tackling. The Company’s strategy of focusing on growing channels, strong brands, innovative products, and productivity improvements, complemented by accretive acquisitions is working, in our view.

New Product Introductions a Positive. New product revenue grew substantially in the fourth quarter, a positive development. With new product introductions normally taking at least 3 years to hit peak revenue, we are encouraged these higher margin products will become…




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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.
 

Research – TherapeuticsMD Inc. (TXMD) – Pre-Q4 Overview: Adjusting Our Earnings Estimates

Thursday, February 13, 2020

TherapeuticsMD Inc. (TXMD)

Pre-Q4 Overview: Adjusting Our Earnings Estimates

(current) TherapeuticsMD, Inc. is a women’s healthcare company focused on developing and commercializing products targeted exclusively for women. It manufactures and distributes branded and generic prescription prenatal vitamins, as well as over-the-counter vitamins and cosmetics, under our vitaMedMD’ and BocaGreenMD’ brands. The company is currently developing advanced hormone therapy pharmaceutical products designed to alleviate the symptoms of and reduce the health risks resulting from menopause-related hormone deficiencies. It is also evaluating various other potential indications for our hormone technology, including oral contraception, preterm birth, vulvar and vaginal atrophy, and premature ovarian failure.

Ahu Demir, Ph.D., Biotechnology Research Analyst, Noble Capital Markets, Inc.

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

Overview. Prior to fourth quarter earnings reporting, we are updating our estimates and wanted to convey our latest thoughts on the company. In this report, we disclose our estimates for each product, having previously reported total revenue numbers. Our investment thesis remains unchanged as we see healthy volume growth and believe all the products are well positioned in the women’s health space.

Our fourth-quarter estimates for the three commercial products. The company transitioned to commercial state following launches of three products (Imvexxy, Bijuva and Annovera) in 2018-2019. The total revenues from these products reached $10.9 mm in the 9-months of 2019; ($9.9 mm from Imvexxy, $0.6 mm from Bijuva, and $0.4mm from Annovera). We are forecasting $6.7 mm sales for Imvexxy, $1.1 mm for Bijuva and…




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This 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.
 

Research – Helix Biopharma – Pioneer in Cancer Therapy Targeting Tumor Microenvironment (TME)

Wednesday, February 12, 2020

Helix Biopharma (HBP: CA)

Pioneer in Cancer Therapy Targeting Tumor Microenvironment (TME)

Helix BioPharma Corp is a Canada-based clinical-stage biopharmaceutical company focused on cancer drug development. It develops therapies in the field of immuno-oncology based on its proprietary technology mainly in the areas of cancer prevention and treatment. The company has Tumor Defense Breakers (L-DOS47), and Tumor Attackers (CAR-T) product candidates in the pipeline.

Cosme Ordonez, Senior Research Analyst, Noble Capital Markets, Inc.

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

Unique Technology Targeting Tumor Microenvironment (TME). We view Helix Biopharma as a pioneer in the cancer area as the company is developing a platform technology targeting the tumor microenvironment. Helix’s technology is designed to reduce tumor acidity, an escape mechanism which cancer cells utilize to evade the anti-tumor immune response. Tumor acidity has been shown to correlate with resistance to anti-cancer treatment and poor prognosis for cancer patients.

Lead drug L-DOS47 for the Treatment of Cancer. Helix Biopharma’s lead drug, L-DOS47, is in Phase II clinical trials for the treatment of non-small cell lung cancer (NSCLC) and pancreatic cancer. In a clinical trial using L-DOS47 as a mono-therapy for the treatment of NSCLC, treated patients showed reductions in tumor size and…


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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.