Monday, March 14, 2022

Vectrus (VEC)
A Deeper Dive: Why We Believe the Vectrus/Vertex Combination is a Winner

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

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

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

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

Price Decline is Not Supported. VEC shares continued to drop, closing on Friday at $34.48, now down $11.81, or 25.5% from the March 4th closing price, prior to the Vertex deal being announced Monday the 7th before the market opened. The sell off is unwarranted in our view. As we mentioned in our March 10th report, we believe the Vertex acquisition to be transformative, creating a global leader in mission-essential solutions. With the acquisition, the combined entity will play in an even larger pool with market trends supporting growth in the converged infrastructure market. We are maintaining our Outperform rating and $62 twelve month price target on VEC shares.

Valuation.  While we acknowledge no two acquisitions are alike, the 9.5x adjusted EBITDA multiple being paid is not out of line. In 2019 AECOM sold its Management Services unit, which provides logistics and technical assistance to the government, for 11.6x. And the median EV/EBITDA multiple for the Aerospace and Defense industry is approximately 14x …

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. 

Monday, March 14, 2022

Vectrus (VEC)
A Deeper Dive: Why We Believe the Vectrus/Vertex Combination is a Winner

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

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

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

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

Price Decline is Not Supported. VEC shares continued to drop, closing on Friday at $34.48, now down $11.81, or 25.5% from the March 4th closing price, prior to the Vertex deal being announced Monday the 7th before the market opened. The sell off is unwarranted in our view. As we mentioned in our March 10th report, we believe the Vertex acquisition to be transformative, creating a global leader in mission-essential solutions. With the acquisition, the combined entity will play in an even larger pool with market trends supporting growth in the converged infrastructure market. We are maintaining our Outperform rating and $62 twelve month price target on VEC shares.

Valuation.  While we acknowledge no two acquisitions are alike, the 9.5x adjusted EBITDA multiple being paid is not out of line. In 2019 AECOM sold its Management Services unit, which provides logistics and technical assistance to the government, for 11.6x. And the median EV/EBITDA multiple for the Aerospace and Defense industry is approximately 14x …

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. 

Monday, March 14, 2022

Kelly Services (KELYA)
Russia, and Potentially Wider, Impact

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.

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

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

Russia Exposure. Given the recent Russia/Ukraine events, we reviewed Kelly’s direct exposure to the two countries. In 2021, Russia accounted for $132.2 million, or approximately 2.7%, of Kelly’s overall revenue. As of January 2, 2022, Kelly’s Russian operations comprised approximately 1% of the Company’s assets. Customer accounts receivable is the primary asset in Russia. Kelly does not have a subsidiary or employees in Ukraine.

Sanctions.  According to the Company, sanctions issued since February 24, 2022 by the European Union, United States, and other countries against certain Russian entities and persons and certain activities involving Russia or Russian entities, have created uncertain economic conditions. The current economic environment, along with the suspension of services by some of the Company’s service providers …

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. 

Read the NobleCon18 Press Release

Zuckerberg Top Executive Joins NobleCon18 Lineup

TV and Radio Personalities to Moderate Panels at NobleCon18

Two-Time Stanley Cup Champion Shares Plans For Next Goal at NobleCon18

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Why it May be Prudent in a Down-Market to Allocate to Individual SPACs

 

When the markets were roaring upwards in 2020 investment capital was abundant, the number of Special Purpose Acquisition Companies (SPACs) going public broke records. Competition to find ideal companies to merge with to fulfill the SPAC’s mission, intensified. Almost two years have passed since SPAC IPOs’ popularity emerged following a much quieter period for these equities. The 2020 vintage SPACs are now nearing their deadlines to find acquisitions or disseminate the money held in escrow back to shareholders. What does this mean to stock market investors?

Background

IPOs offered as SPACs in 2020 broke all previous records, in terms of the number of offerings, and gross proceeds. In 2021 there was even more issuance. SPACs are not new; they have existed for decades, they are sometimes referred to as blank check companies and shell companies. They have also been called “backdoor IPOs” because it allows a private company to go public without the normal process of filing and disclosures through the regular IPO filing process. Filing for an IPO with a SPAC is much quicker for private companies than going the traditional IPO route.

Currently, there are 602 SPACs with 162.4 billion in combined funds looking to find acquisitions. There are SPACs succeeding in finding acquisition targets, tickers like BOWL, DWAC, CPSR have recently either merged or are in a deSPAC phase, headed toward merging. But it is unlikely that there are 600 well-suited, private companies looking to go public via SPAC acquisition.  This isn’t necessarily bad for the investors in the stock, if there is a downside it is to the finance entities that went through the expense and management of the SPAC for two years.

Investors lose little more than opportunity while their funds were tied up. This is because when a SPAC fails to merge, the funds from the IPO, less expenses, plus accrued interest, are then all returned to the current holder of shares.

 

Performance

So far this year SPACs have outperformed the market significantly. This may be because SPACs don’t have as much downside, as mentioned, the initial investment is held in an escrow account that typically earns interest. Should the SPAC not merge after 24 months, investors have a fairly good idea of what they can expect to be returned to them. They may not make money, but depending on their purchase price they shouldn’t lose much. The returned cash is most often just below the initial $10 offering price. This protection prevents the SPAC from decreasing in value greatly from its offering price, while still maintaining the potential to find a target that could drive the price significantly upward. The structure demonstrates a level of safety that is not shared by other common stocks.

 

 

There is an enhanced benefit to SPAC owners in 2022 that barely existed in 2020 and early 2021 when so many of the SPACs came to market, interest rates are now averaging 3% in the escrow accounts. This is up from when rates approximated 0% when the older SPACs came to market.

SPCX used in the chart above is an actively managed ETF comprised of SPAC IPOs. Using it as a proxy for the SPAC market and comparing its performance to the S&P 500 YTD, it’s clear that SPAC stocks are a diversifier in a portfolio – they trade off their own fundamentals. The very big risk-flattening mechanism is that they effectively have a price floor for each individual SPAC.

Portfolios looking to reduce downside risk yet maintain upside potential may want to allocate into well-selected individual SPACs. To do this some investors research by evaluating the market value of the issuance and comparing it to escrow trust account value balance. What they are looking for is pre-deal shell companies that are worth more than their market price. These situations where one pays less in cash than the cash the company holds is a strategy that is gaining popularity as all markets weaken. 

 

Source: SPAC Research

 

Take-Away

Competition to find perfect merger candidates intensified to an extreme never before seen for SPACs as issuance rose from 59 deals in 2019, to 248 in 2020, and 613 in 2021. A failed SPAC (one that doesn’t find a target in 24 months) is unfortunate for the finance company issuer, but it is not necessarily bad for the stockholder. Stockholders have the option if the company finds a target, of opting out and collecting their pro-rata share of the trust or retaining the stock and owning the company it acquires. If there is no acquisition within the specified period, the stockholder is cashed out at their pro-rata share of the trust. There are stocks that are trading for less than their escrow value, some investors seek these out.

For updates on small and microcap stocks, including SPACS, sign-up to receive Channelchek daily research and information.

 

Paul Hoffman

Managing Editor, Channelchek

 

Suggested Reading

Investors Watch Media SPAC Stay in the Green as Markets Falter

Analysis of a SPAC

Merger of a SPAC, the De-SPAC Phase Explained

Lifecycle of a SPAC

 

Sources

https://www.spcxetf.com/the-fund/

https://www.spacresearch.com/

 

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NobleCon18 Scheduled Speakers

REGISTER FREE AS AN INVESTOR  |  PRESENTING COMPANY INQUIRIES  |  PRESENTING COMPANIES LIST  |  
SCHEDULE OF PRESENTERS
 |    |  NOBLECON18.COM

Bert Alfonso – CFO Information Services (III)	Shone Anstey – CEO LQwD FinTech (LQWDF)	Robert Archer – CEO and Director Newrange Gold (NRGOF)	Douglas Bartole – President / CEO InPlay Oil (IPOOF)	Tom Bock – EVP Digital Media Solutions (DMS)
Michael Bondi – CFO Comtech (CMTL)	Michael Borton – CFO Flotek Industries (FTK)	Andrew Bowden – CEO Item 9 Labs (INLB)	David Bruce – CEO FGI Industries (FGI)	Brian Cantrell – SVP and CFO Alliance Resource Partners (ARLP)
Daniel Carcillo – CEO Wesana Health Holdings (WSNAF)	A.J. Cervantes Jr. – Chairman & Founder Smart for Life (SMFL)	Mark Chalmers – President & CEO Energy Fuels (UUUU)	Bradley Chhay – CFO RCI Hospitality Holdings (RICK)	Spencer Cole – EVP North America Vox Royalty (VOXCF)
Ryan Confer – CFO Genprex (GNPX)	Michael Connors – CEO Information Services (III)	Lisa Conte – CEO Jaguar Health (JAGX)	Robert Crane – CFO Axcella Therapeutics (AXLA)	Brian Culley – CEO , President & Director (New) Lineage Cell Therapeutics (LCTX)
Gianni Del Signore – CFO Pangaea Logistics (PANL)	Warren Duncan – CFO Filament Health (FLHLF)	Justin Dye – CEO Schwazze (SHWZ)	Paul Echt – CFO Media and Games Invest	Stephen Ehrlich – CEO Voyager Digital (VYGVF)
Mehran Ehsan – President & CEO Permex Petroleum (OILCF)	Brian Evans – CFO The GEO Group (GEO)	Michael Federle – CEO Forbes Global Media	Kyle Floyd – CEO Vox Royalty (VOXCF)	Scott Frohman – President Odyssey Wellness
Peter Gianulis – CEO Allegiant Gold (AUXXF)	John Gibson – CEO Flotek Industries (FTK)	Ryan Goepel – CFO Global Crossing Airlines (JETMF)	Ilan Hadar – CEO PainReform Ltd. (PRFX)	Arjan Haverhals – President & CEO Milestone Scientific (MLSS)
Wayne W. Heili – CEO Peninsula Energy (PENMF)	Gerri Henwood – President & CEO Baudax Bio (BXRX)	Matthew Hornor – President/CEO Maple Gold Mines (MGMLF)	Nancy Huber – CFO Schwazze (SHWZ)	Kathryn JohnBull – CFO DLH (DLHC)
Lauri Kearnes – CFO Harte Hanks (HHS)	John Keeler – CEO Blue Star Foods (BSFC)	David Kelley – CEO Chakana Copper (CHKKF)	Gust Kepler – CEO & Co-Founder Blackboxstocks (BLBX)	Giorgi Khazaradze – CEO Aurox
John Kiernan – CEO Alico (ALCO)	Rani Kohen – Executive Chairman SQL Technologies (SKYX)	Dmitry Kozko – CEO Motorsport Games (MSGM)	Sean Krakiwsky – President & CEO Nanalysis Scientific (NSCIF)	Eric Langan – CEO RCI Hospitality Holdings (RICK)
Seth Lederman, MD – Co-Founder, CEO & Chairman Tonix Pharmaceuticals (TNXP)	Arthur Levine – CFO EZFill (EZFL)	Evan Levine – CEO PsyBio Therapeutics (PSYBF)	Ben Lightburn – Co-Founder & CEO Filament Health (FLHLF)	Brian Linscott – CEO Harte Hanks (HHS)
Ken Londoner – CEO, Executive Chairman & Co-Founder BioSig Technologies (BSGM)	Frank Lopez-Balboa – CFO Cumulus Media (CMLS)	Paul Manley – VP Investor Relations Wrap Technologies (WRAP)	Joe Marinucci – CEO Digital Media Solutions (DMS)	Cary Marshall – VP, Corp Finance & Treasurer Alliance Resource Partners (ARLP)
James Martin – CFO & Corporate Secretary Cocrystal Pharma (COCP)	Evan Masyr – CFO Salem Media Group (SALM)	Leonard Mazur – Executive Chairman Citius Pharmaceuticals (CTXR)	Michael McConnell – CEO EZFill (EZFL)	John McGraw – President & CEO Izotropic Corporation (IZOZF)
Margot M. Micallef – Founder & CEO GABY (GABLF)	Bobby Mikkelsen – CFO Item 9 Labs (INLB)	Tim Millage – Current CFO Lee Enterprises (LEE)	Darren Minton – President Smart for Life (SMFL)	John Morrison – CFO One Stop Systems (OSS)
Kevin Mowbray – President / CEO / Director Lee Enterprises (LEE)	Shankar Musunuri, PhD – Founder, Chairman & CEO Ocugen (OCGN)	Nir Naor – CFO HMNC Brain Health	Jonathan New – CFO Motorsport Games (MSGM)	Matt Nicosia – CEO Vivakor (VIVK)
Robert Nistico – CEO Splash Beverage Group (SBEV)	Steve O’Laughlin – Principal Financial Officer Actinium Pharmaceuticals (ATNM)	George Palikaras – CEO Meta Materials Inc. (MMAT)	Christiana Papadopoulos – IR Mgr Sierra Metals (SMTS)	Zachary Parker – President and CEO DLH (DLHC)
Eric Pharis – COO Blackboxstocks (BLBX)	Michael Porcelain – CEO Comtech (CMTL)	Scott Powell – EVP Investor Relations VolitionRx (VNRX)	Evan Psaropoulos – CFO Voyager Digital (VYGVF)	Peter Quigley – President & CEO Kelly Services (KELYA)
Richard Rallo – CFO & Chief Accounting Officer Alico (ALCO)	Jeffrey I. Rassás – Chief Strategy Officer Item 9 Labs (INLB)	David Raun – CEO One Stop Systems (OSS)	Dave Rosa – CEO NeuroOne Medical Technologies (NMTC)	Stuart Rosenstein – CFO Townsquare Media (TSQ)
Christopher Ruddy – CEO Newsmax	Lena Russomagno – Associate Director of Operations Tonix Pharmaceuticals (TNXP)	Corey Ruttan – CEO Alvopetro Energy (ALVOF)	Shane Schaffer – CEO Cingulate (CING)	Lou Schwartz – CEO Engine Media and Gaming (GAME)
Tom Shannon – Founder & CEO Bowlero Corp. (BOWL)	Matt Singh – CCO Psyched Wellness (PSYCF)	Russell Skibsted – EVP, CFO & CBO Rockwell Medical (RMTI)	Arthur Smith – CEO Digerati Technologies (DTGI)	Jeremy Sobotta – President & CEO Perimeter Medical Imaging AI (PYNKF)
Jeff Stevens – CEO Psyched Wellness (PSYCF)	Sanjay Subramanian – CFO Ocugen (OCGN)	Dean Taylor – CEO Diamcor Mining (DMIFF)	Marie Tedesco – CFO Beasley Broadcast Group (BBGI)	Olivier Thirot – CFO Kelly Services (KELYA)
Suresh Venkatachari – Chairman & CEO Healthcare Triangle (HCTI)	Gary Vogel – CEO Eagle Bulk Shipping (EGLE)	William Willoughby – Director and CEO Cypress Development (CYDVF)	Bill Wilson – CEO Townsquare Media (TSQ)	Mark Wingertzahn – Chief Science Officer Wesana Health Holdings (WSNAF)
Robert Winspear – CFO Blackboxstocks (BLBX)	John Wobensmith – CEO Genco Shipping (GNK)	David Wolfin – President & CEO Avino Silver & Gold (ASM)	Zhenyu Wu – CFO Elite Education Group International (EEIQ)	Michael York – CFO Forbes Global Media
Chris Young – EVP, CFO & Treasurer Entravision Communications (EVC)	Apostolos Zafolias – CFO Genco Shipping (GNK)

NobleCon18 Confirmed Speakers

REGISTER FREE AS AN INVESTOR  |  PRESENTING COMPANY INQUIRIES  |  NOBLECON18.COM

Bert Alfonso – CFO Information Services (III)	Robert Archer – CEO and Director Newrange Gold Corp. (NRGOF)	Douglas Bartole – President / CEO InPlay Oil (IPOOF)	Michael Bondi – CFO Comtech (CMTL)	Michael Borton – CFO Flotek Industries (FTK)
Andrew Bowden – CEO Item 9 Labs Corp. (INLB)	Brian Cantrell – SVP and CFO Alliance Resource Partners, L.P. (ARLP)	Daniel Carcillo – CEO Wesana Health Holdings Inc. (WSNAF)	John Carlesso – CEO FenixOro Gold Corp. (FDVXF)	Mark Chalmers – President & CEO Energy Fuels (UUUU)
Bradley Chhay – CFO RCI Hospitality Holdings, Inc. (RICK)	Michael Connors – CEO Information Services (III)	Lisa Conte – CEO Jaguar Health (JAGX)	Robert Crane – CFO Axcella Therapeutics (AXLA)	Gianni Del Signore – CFO Pangaea Logistics (PANL)
Warren Duncan – CFO Filament Health Corp. (FLHLF)	Justin Dye – CEO Schwazze (SHWZ)	Stephen Ehrlich – CEO Voyager Digital Ltd. (VYGVF)	Brian Evans – CFO The GEO Group, Inc. (GEO)	Peter Gianulis – CEO Allegiant Gold (AUXXF)
John Gibson – CEO Flotek Industries (FTK)	Ryan Goepel – CFO Global Crossing Airlines Inc. (JETMF)	Ilan Hadar – CEO PainReform Ltd. (PRFX)	Arjan Haverhals – President & CEO Milestone Scientific (MLSS)	Gerri Henwood – President & CEO Baudax Bio, Inc. (BXRX)
Nancy Huber – CFO Schwazze (SHWZ)	Kathryn JohnBull – CFO DLH (DLHC)	Lauri Kearnes – CFO Harte Hanks (HHS)	John Keeler – CEO Blue Star Foods Corp. (BSFC)	David Kelley – CEO Chakana Copper Corp (CHKKF)
Gust Kepler – CEO & Co-Founder Blackboxstocks Inc. (BLBX)	Giorgi Khazaradze – CEO Aurox	Eric Langan – CEO RCI Hospitality Holdings, Inc. (RICK)	Seth Lederman, MD – Co-Founder, CEO & Chairman Tonix Pharmaceuticals (TNPX)	Ben Lightburn – Co-Founder & CEO Filament Health Corp. (FLHLF)
Brian Linscott – CEO Harte Hanks (HHS)	Ken Londoner – CEO, Executive Chairman & Co-Founder BioSig Technologies (BSGM)	Paul Manley – VP Investor Relations Wrap Technologies, Inc. (WRAP)	Cary Marshall – VP, Corp Finance & Treasurer Alliance Resource Partners, L.P. (ARLP)	James Martin – CFO & Corporate Secretary Cocrystal Pharma Inc. (COCP)
Evan Masyr – CFO Salem Media Group (SALM)	Margot M. Micallef – Founder & CEO GABY Inc. (GABLF)	Tim Millage – CFO Lee Enterprises, Inc. (LEE)	Kevin Mowbray – President / CEO / Director Lee Enterprises, Inc. (LEE)	Shankar Musunuri, PhD – Founder, Chairman & CEO Ocugen (OCGN)
Nir Naor – CFO HMNC Holding GmbH	Chris Naprawa – President TAAL Distributed Information Technologies (TAALF)	Robert Nistico – CEO Splash Beverage Group, Inc. (SBEV)	Steve O’Laughlin – Principal Financial Officer Actinium Pharmaceuticals (ATNM)	Christiana Papadopoulos – IR Mgr Sierra Metals (SMTS)
Zachary Parker – President and CEO DLH (DLHC)	Eric Pharis – COO Blackboxstocks Inc. (BLBX)	Michael Porcelain – CEO Comtech (CMTL)	Scott Powell – EVP Investor Relations VolitionRx (VNRX)	Evan Psaropoulos – CFO Voyager Digital Ltd. (VYGVF)
Peter Quigley – President & CEO Kelly Services (KELYA)	Jeffrey I. Rassás – Chief Strategy Officer Item 9 Labs Corp. (INLB)	Dave Rosa – CEO Neuroone Medical Technologies Corp. (NMTC)	Stuart Rosenstein – CFO Townsquare Media (TSQ)	Lena Russomagno – Associate Director of Operations Tonix Pharmaceuticals (TNPX)
Corey Ruttan – CEO Alvopetro Energy (ALVOF)	David Santrella – President, Broadcast Media Salem Media Group (SALM)	Matt Singh – CCO Psyched Wellness Ltd. (PSYCF)	Russell Skibsted – EVP, CFO & CBO Rockwell Medical (RMTI)	Arthur Smith – CEO Digerati Technologies, Inc. (DTGI)
Jeff Stevens – CEO Psyched Wellness Ltd. (PSYCF)	Sanjay Subramanian – CFO Ocugen (OCGN)	Marie Tedesco – CFO Beasley Broadcast Group (BBGI)	Olivier Thirot – CFO Kelly Services (KELYA)	Suresh Venkatachari – Chairman & CEO Healthcare Triangle (HCTI)
William Willoughby – Director and CEO Cypress Development Corp. (CYDVF)	Bill Wilson – CEO Townsquare Media (TSQ)	Mark Wingertzahn – Chief Science Officer Wesana Health Holdings Inc. (WSNAF)	Robert Winspear – CFO Blackboxstocks Inc. (BLBX)	David Wolfin – President & CEO Avino Silver & Gold (ASM)
Zhenyu Wu – CFO Elite Education Group International Ltd. (EEIQ)	Chris Young – EVP, CFO & Treasurer Entravision Communications (EVC)

Friday, February 18, 2022

The GEO Group, Inc. (GEO)
Solid Performance in a Challenging Year

With over 94,000 beds owned, leased or managed across its business lines and serving over 260,000 people daily, GEO is a leading provider of mission critical real estate to its governmental partners. The Company is the first fully integrated equity REIT specializing in the design, financing, development, and operation of secure facilities, processing centers, and community reentry centers in the U.S., Australia, South Africa, and the U.K.

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

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

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

4Q21 Results. The GEO Group reported solid results for the fourth quarter of 2021. Total revenue for the quarter was $557.5 million compared to guidance of $554-$559 million. We were at $555 million. GEO reported AFFO of $0.65/sh, compared to guidance of $0.65/sh -$0.67/sh. We were at $0.58/sh. Adjusted earnings were $0.38/sh versus $0.33/sh last year.


Full Year 2021.  In a difficult year of COVID and non-renewal of contracts, revenue declined 4.0% to $2.26 billion. GAAP EPS was $0.58 and adjusted EPS was $1.32, compared to $0.94 and $1.30, respectively, in 2020. AFFO for 2021 was $2.48 per share, similar to the $2.51 in 2020. Adjusted EBITDA in 2021 was $466.9 million, up from $439.8 million last year …

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. 

  Image Credit: Maurizio Pesce

Musk’s Lawyers Suggest a Rogue U.S. Agency is being Weaponized Against Him

 

Tesla CEO Elon Musk’s legal representatives say the Securities and Exchange Commission (SEC) is conducting ‘unfounded investigations’ on him and the EV company. In a letter, to a federal judge, Tesla’s lawyers accuse the regulator of not distributing a $40 million fine paid after a 2018 settlement to shareholders allegedly harmed over Musk’s Twitter posts.

The correspondence sent Thursday (February 16) accuses the SEC of conducting “unfounded investigations” of Mr. Musk and Tesla. The letter was addressed to the federal judge who oversaw the settlement. As a result, Tesla has essentially become what it sees as a whistleblower against the SEC.

 

Background

Tesla and the SEC settled an enforcement action in 2018 that alleged that Musk had committed fraud by tweeting about a potential buyout of the company. Tesla paid $20 million to settle that case. Musk also personally paid $20 million. He also agreed to have his public statements on social media overseen by Tesla lawyers.

In correspondence sent to Tesla in both 2019 and 2020, the SEC said tweets Musk wrote regarding Tesla’s solar roof production volumes and its stock price hadn’t undergone the required preapproval and supervision.  The communications involving the Commission are part of the tensions between the nation’s public market regulator and the founder of the $927 billion dollar car company. It should also be noted that after the settlement, Musk publicly mocked the SEC.

To date, the SEC hasn’t distributed the $40 million in fine money to those holding shares at the time of his 2018 tweets that claimed he planned to take Tesla private, according to the letter sent to the judge. The part of the agreement that was to be upheld by Tesla (in addition to the $40 million) is that company lawyers would preclear certain of the CEO’s tweets and other public statements. The SEC wants proof of adherence.

Tesla’s New Accusation

According to the letter signed by Tesla attorney Andrew Spiro, “The SEC seems to be targeting Mr. Musk and Tesla for unrelenting investigation largely because Mr. Musk remains an outspoken critic of the government.” The letter addressed to U.S. District Judge Alison Nathan in Manhattan, pointed out that if the Commission was concerned “the SEC has not once come before Your Honor to seek discovery concerning compliance under the consent decree,” the letter continues, “Instead, it has gone rogue, and unilaterally opened its own investigations.”  Then Spiro accuses, “The SEC has conducted these investigations wholly outside of this court’s supervision.”

Take-Away

Tesla attorney Andrew Spiro’s letter suggests that Elon Musk and the company’s board regret settling and agreeing to the social-media oversight policy, and monetary portion, which Judge Nathan approved. Also, the company decided to resolve the lawsuit because it believed that fine money would go to Tesla shareholders. In the absence of, (according to Tesla), the SEC not keeping its part of the deal, and (according to the SEC) Tesla not adequately maintaining its part of the agreement, tensions may soon come to a head.

 

Suggested Reading

Tesla’s Strange Influence on the Markets

Publicly Traded Chinese Companies Duty to Shareholders

Elon Musk Reminds Jeff Bezos that He’s Pulling Away

New Measures to Limit Government Officials Trading

 

Sources

https://www.sec.gov/news/press-release/2018-226

https://www.wsj.com/articles/sec-subpoenas-tesla-seeking-information-linked-to-elon-musk-settlement-11644248873?mod=article_inline

https://www.theguardian.com/technology/2021/jun/02/elon-musk-tweets-tesla-sec-settlement#:~:text=The%20SEC%20had%20sued%20Musk,13.3%25%2C%20violated%20securities%20law.

https://nypost.com/2022/02/17/elon-musk-lawyer-sec-gone-rogue-stiffed-tesla-investors-40m/

https://www.autonews.com/executives/elon-musk-tesla-accuse-sec-unrelenting-probe

 

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  Image Credit: Maurizio Pesce

Musk’s Lawyers Suggest a Rogue U.S. Agency is being Weaponized Against Him

 

Tesla CEO Elon Musk’s legal representatives say the Securities and Exchange Commission (SEC) is conducting ‘unfounded investigations’ on him and the EV company. In a letter, to a federal judge, Tesla’s lawyers accuse the regulator of not distributing a $40 million fine paid after a 2018 settlement to shareholders allegedly harmed over Musk’s Twitter posts.

The correspondence sent Thursday (February 16) accuses the SEC of conducting “unfounded investigations” of Mr. Musk and Tesla. The letter was addressed to the federal judge who oversaw the settlement. As a result, Tesla has essentially become what it sees as a whistleblower against the SEC.

 

Background

Tesla and the SEC settled an enforcement action in 2018 that alleged that Musk had committed fraud by tweeting about a potential buyout of the company. Tesla paid $20 million to settle that case. Musk also personally paid $20 million. He also agreed to have his public statements on social media overseen by Tesla lawyers.

In correspondence sent to Tesla in both 2019 and 2020, the SEC said tweets Musk wrote regarding Tesla’s solar roof production volumes and its stock price hadn’t undergone the required preapproval and supervision.  The communications involving the Commission are part of the tensions between the nation’s public market regulator and the founder of the $927 billion dollar car company. It should also be noted that after the settlement, Musk publicly mocked the SEC.

To date, the SEC hasn’t distributed the $40 million in fine money to those holding shares at the time of his 2018 tweets that claimed he planned to take Tesla private, according to the letter sent to the judge. The part of the agreement that was to be upheld by Tesla (in addition to the $40 million) is that company lawyers would preclear certain of the CEO’s tweets and other public statements. The SEC wants proof of adherence.

Tesla’s New Accusation

According to the letter signed by Tesla attorney Andrew Spiro, “The SEC seems to be targeting Mr. Musk and Tesla for unrelenting investigation largely because Mr. Musk remains an outspoken critic of the government.” The letter addressed to U.S. District Judge Alison Nathan in Manhattan, pointed out that if the Commission was concerned “the SEC has not once come before Your Honor to seek discovery concerning compliance under the consent decree,” the letter continues, “Instead, it has gone rogue, and unilaterally opened its own investigations.”  Then Spiro accuses, “The SEC has conducted these investigations wholly outside of this court’s supervision.”

Take-Away

Tesla attorney Andrew Spiro’s letter suggests that Elon Musk and the company’s board regret settling and agreeing to the social-media oversight policy, and monetary portion, which Judge Nathan approved. Also, the company decided to resolve the lawsuit because it believed that fine money would go to Tesla shareholders. In the absence of, (according to Tesla), the SEC not keeping its part of the deal, and (according to the SEC) Tesla not adequately maintaining its part of the agreement, tensions may soon come to a head.

 

Suggested Reading

Tesla’s Strange Influence on the Markets

Publicly Traded Chinese Companies Duty to Shareholders

Elon Musk Reminds Jeff Bezos that He’s Pulling Away

New Measures to Limit Government Officials Trading

 

Sources

https://www.sec.gov/news/press-release/2018-226

https://www.wsj.com/articles/sec-subpoenas-tesla-seeking-information-linked-to-elon-musk-settlement-11644248873?mod=article_inline

https://www.theguardian.com/technology/2021/jun/02/elon-musk-tweets-tesla-sec-settlement#:~:text=The%20SEC%20had%20sued%20Musk,13.3%25%2C%20violated%20securities%20law.

https://nypost.com/2022/02/17/elon-musk-lawyer-sec-gone-rogue-stiffed-tesla-investors-40m/

https://www.autonews.com/executives/elon-musk-tesla-accuse-sec-unrelenting-probe

 

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Kelly® Declares Quarterly Dividend

Research, News, and Market Data on Kelly

 

TROY, Mich., 
Feb. 16, 2022 /PRNewswire/ — Kelly^® (Nasdaq: KELYA, KELYB), a leading specialty talent solutions provider, today announced that its Board of Directors has declared a quarterly dividend of 
$0.05 per share on Kelly Services Class A and Class B common stock. The dividend is payable 
March 14, 2022 to shareholders of record at the close of business on 
February 28, 2022.

About Kelly^®

Kelly Services, Inc. (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 more than 350,000 people around the world, and we 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.

KLYA-FIN

ANALYST & MEDIA CONTACT:
James Polehna
(248) 244-4586
james_polehna@kellyservices.com

SOURCE 
Kelly Services, Inc.

Kelly® Declares Quarterly Dividend

Research, News, and Market Data on Kelly

 

TROY, Mich., 
Feb. 16, 2022 /PRNewswire/ — Kelly^® (Nasdaq: KELYA, KELYB), a leading specialty talent solutions provider, today announced that its Board of Directors has declared a quarterly dividend of 
$0.05 per share on Kelly Services Class A and Class B common stock. The dividend is payable 
March 14, 2022 to shareholders of record at the close of business on 
February 28, 2022.

About Kelly^®

Kelly Services, Inc. (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 more than 350,000 people around the world, and we 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.

KLYA-FIN

ANALYST & MEDIA CONTACT:
James Polehna
(248) 244-4586
james_polehna@kellyservices.com

SOURCE 
Kelly Services, Inc.

  Image Credit: Safe Harbor Financial 

Cannabis Bank Sowing New Seeds as it Announces SPAC Merger

 

The latest SPAC or “blank check company” to find the desired target will help fulfill the growing need for banking services for cannabis-related businesses (CRB) in Colorado, and beyond. At the helm of the soon to be merged institution will be one of the pioneers that has helped lead the way by overcoming barriers to financial services for CRBs.

Career banker Sundie Seefried literally wrote the book on cannabis banking back in 2015. She says she was inspired by public safety risks posed by what was largely an all-cash business. After Colorado eased marijuana restrictions, she worked to serve this sector’s financial needs. Sundie became a leader in cannabis banking and has been providing guidance to other bankers, business owners, and policymakers.  Ms. Seefried, who runs Safe Harbor Financial Corp. will soon be sowing more potent seeds within the industry.

Seefried’s Safe Harbor Financial announced a definitive agreement Monday to be taken public by Northern Lights Acquisition (NLIT) which was formed as a special purpose acquisition corporation (SPAC).

In a news release, Seefried explained the deal will position Safe Harbor to expand its financial services and support the growth of the cannabis industry. “Our goal is to become a ‘one stop-shop’ for cannabis business financial needs,” she added.

 

Terms of the Agreement

Under the merger, New York-based Northern Lights (NLIT), an affiliate of Luminous Capital, will pay $70 million in cash and $115 million in common stock to acquire Safe Harbor, a subsidiary of Colorado-based Partner Colorado Credit Union. The post-transaction equity value of the company is expected to be $327 million, according to the release.

The deal has already been approved by the board of directors and managers of Northern Lights, Partners Colorado and Safe Harbor, according to the news release. It remains subject to other closing conditions including approval by the stockholders of Northern Lights.

 

About Safe Harbor

Safe Harbor has nearly 600 accounts across 20 states. During 2021 it processed $4 billion in transactions, for a total of $11 billion since it began operations, according to the release.

Last year, Safe Harbor unveiled a commercial cannabis lending platform. Currently, it has an actionable pipeline of more than $300 million, including both existing and new customers, the release said.

John Darwin and Joshua Mann, co-CEOs of Northern Lights, will remain on Northern Lights’ board of directors after the sale is finalized. Sundie Seefried will serve as CEO of the merged company.

 

Suggested Reading

Banks and Credit Unions Are Now Allowing Services For Marijuana And Cannabis Businesses

What’s in the Senate’s Marijuana Tax Proposal

Marijuana is Winning the Sports Battle

Clarence Thomas’ Statement on Half-in, Half-out Marijuana Laws

 

Sources

https://www.prnewswire.com/news-releases/northern-lights-acquisition-corp-announces-entering-into-a-business-combination-agreement-with-safe-harbor-financial-the-leading-provider-of-financial-services-and-access-to-banking-solutions-for-the-us-cannabis-industry-301481232.html

https://financialregnews.com/northern-lights-details-acquisition-of-leading-financial-services-provider-for-cannabis-industry/

https://shfinancial.org/resources/

https://www.facebook.com/SafeHarborFinancialLLC/photos/a.278325677682904/316238937224911

 

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