Page 209 – Channelchek

Billionaire Leon Cooperman Sounds the Alarm on Looming Financial Crisis

Posted on April 25, 2024April 25, 2024 by slightbourne@noblecapitalmarkets.com

In a characteristically blunt assessment, billionaire investor Leon Cooperman painted a grim picture of the current economic landscape during his recent appearance on CNBC’s Squawk Box. The legendary investor, known for his storied career at Goldman Sachs and the success of his hedge fund Omega Advisors, did not mince words as he expressed grave concerns about the state of the nation’s leadership, fiscal policies, and the potential for an impending financial crisis.

Cooperman’s remarks kicked off with a scathing critique of the upcoming presidential election, describing the choices as “bad and worse.” This sentiment underscored his belief in a broader “leadership crisis” within the country, which he believes is exacerbating the already precarious economic situation.

At the forefront of Cooperman’s concerns is the ballooning federal debt and the persistent trade deficit plaguing the nation. “The evils of trade and debt deficit,” as he put it, are a ticking time bomb that could potentially trigger a financial crisis of unprecedented proportions. He emphasized that “deficits matter,” and the current trajectory is unsustainable, warning that the consequences of unchecked borrowing and spending could manifest in the form of higher interest rates, rampant inflation, and a weakened currency.

Cooperman also leveled criticism at the Federal Reserve, giving them a “low grade” for their handling of monetary policy. He lambasted the central bank for keeping interest rates near zero for nearly a decade, only to abruptly raise them by a staggering 500 basis points within a year. This whiplash-inducing policy shift, according to Cooperman, is symptomatic of the Fed’s missteps and lack of foresight.

Despite the stock market hovering near record highs, Cooperman warned of rampant speculation and froth in certain segments of the market. He cited the frenzy surrounding former President Trump’s social media venture and the proliferation of special purpose acquisition companies (SPACs) as examples of speculative excess. Cooperman cautioned that the current market euphoria might be misguided, as there are no clear signs that the Fed’s tightening measures have been sufficiently restrictive to rein in inflation.

Interestingly, Cooperman’s portfolio reflects a defensive posture, with 15% allocated to energy stocks and 20% invested in bonds. However, he expressed concerns about the ongoing lawsuit with Spectrum against the government, which could impact the value of his bond holdings.

In a contrarian move, Cooperman revealed a preference for equities over bonds, defying conventional wisdom that favors fixed-income assets in times of economic uncertainty. This stance underscores his belief that certain sectors and companies may offer better risk-adjusted returns than the bond market, which he views as overvalued.

Cooperman’s dire warnings and contrarian positions serve as a stark reminder of the uncertainties and potential pitfalls facing investors in the current market environment. While his views may be controversial, they underscore the importance of vigilance, risk management, and careful asset allocation in navigating the turbulent waters of the global economy.

As investors and financial professionals grapple with the challenges ahead, Cooperman’s sobering assessments demand careful consideration, even if they challenge conventional wisdom. In the end, his candor and willingness to voice unpopular opinions may prove invaluable in preparing for the potential storms on the horizon.

Travelzoo (TZOO) – An Improved Balance Sheet; Stable Outlook

Posted on April 25, 2024April 25, 2024 by cpereira@noblefcm.com

Thursday, April 25, 2024

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.

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

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

Mixed Q1 Results. The company reported Q1 revenue of $22.0 million, a modest 1.8% increase over the year earlier results and a significant sequential deceleration from 13.7% in the previous quarter. Adj. EBITDA in the latest quarter was $6.1 million, beating our estimate of $5.8 million by 5.0%, a result of lower marketing spend.

A year of transition. In January the company switched to a paid subscription, all new members pay a $40 annual fee, while members who joined prior to January 2024 do not pay a subscription fee until January 2025. Notably, the company plans to increase marketing spend in the coming quarters as it aims to grow the number of paid members, a development we view favorably.

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Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.

Orion Group Holdings (ORN) – First Look into the First Quarter

Posted on April 25, 2024April 25, 2024 by cpereira@noblefcm.com

Thursday, April 25, 2024

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.

Results. Revenue for the first quarter was $160.7 million, a 0.9% increase from $159.2 million last year but lower than our estimate of $170 million. Adjusted net loss totaled $4.0 million, or a loss of $0.12, an improvement from a net loss of $10.3 million or $0.32 last year. Adjusted EBITDA was $4.1 million compared to a negative $4.1 million in the prior year. We estimated an adjusted net loss of $7.5 million, or a loss of $0.23, and adjusted EBITDA of $2.6 million.

Continued Margin Improvement. The first quarter brought higher margins compared to last year, as management’s focus on margin improvement continues to deliver. Gross margin improved to 9.7% from 3.7% in the prior year. Adjusted EBITDA margin improved to 2.5% from (2.6)% in the prior year. With management’s strategic plan towards higher quality projects, we expect continued higher margins in the future.

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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).

MustGrow Biologics Corp. (MGROF) – Releases Fiscal Year 2023 Results

Posted on April 25, 2024April 25, 2024 by cpereira@noblefcm.com

Thursday, April 25, 2024

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.

Fiscal Year Results. Management reported revenue of CAD$4.7 million for the year from CAD$6,479 last year. This is due to fees earned from technology license, evaluation, and collaboration agreements. The Company had a net loss of CAD$676,940, or a loss of $0.01 per share, from a loss of CAD$5.6 million or $0.11 last year, with the improvement from the increased revenue.

Balance Sheet and Cash Flow. MustGrow ended the year with CAD$6.8 million in cash, slightly down from CAD$7.0 million last year. The Company used CAD$294,764 in CFFO, an improvement from a use of CAD$3.3 million last year. The improvement was due to the revenue from fees earned. Barring any additional revenue, we estimate that the Company currently has an approximate 15-month runaway before needing new capital.

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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).

Comstock Inc. (LODE) – Comstock Fuels Gains Commercial Momentum

Posted on April 25, 2024April 25, 2024 by cpereira@noblefcm.com

Thursday, April 25, 2024

Comstock (NYSE: LODE) innovates technologies that contribute to global decarbonization and circularity by efficiently converting under-utilized natural resources into renewable fuels and electrification products that contribute to balancing global uses and emissions of carbon. The Company intends to achieve exponential growth and extraordinary financial, natural, and social gains by building, owning, and operating a fleet of advanced carbon neutral extraction and refining facilities, by selling an array of complimentary process solutions and related services, and by licensing selected technologies to qualified strategic partners. To learn more, please visit www.comstock.inc.

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.

Agreement executed with RenFuel K2B AB. Comstock completed agreements to invest up to $3 million in RenFuel K2B AB over a three-year period. The investment will support commercialization of joint development applications and renewable fuel technologies, along with the development of a 100 thousand tonnes per year (TPY) biorefinery joint venture project in Sweden. The agreements call for the purchase of up to $3 million in 7% senior secured convertible notes funded in quarterly installments of $250 thousand for three years.

The power of partnership. Comstock’s partnership with RenFuel has accelerated the commercialization of its technologies. The companies’ joint venture project is strategic to Comstock’s plan to commercialize its proprietary Bioleum product. Comstock uses RenFuel’s patented catalytic esterification technology to refine Bioleum derivatives into Hydro-deoxygenated Bioleum Oil (HBO) for use by advanced biofuel refineries to produce sustainable aviation and renewable diesel fuel.

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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).

Noble Capital Markets Emerging Growth Virtual Healthcare Conference Presentation Replays

Posted on April 25, 2024May 6, 2024 by slightbourne@noblecapitalmarkets.com

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**Anavex Life Sciences (AVXL)**
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**Atara Biotherapeutics, Inc (ATRA)**
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**Atossa Therapeutics (ATOS)**
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**Cadrenal Therapeutics (CVKD)**
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**Citius Pharmaceuticals Inc (CTXR)**
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**Ensysce Biosciences Inc. (ENSC)**
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**Immunic Therapeutics (IMUX)**
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**Kiora Pharmaceuticals (KPRX)**
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**Lisata Therapeutics (LSTA)**
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**MAIA Biotechnology (MAIA)**
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**SeaStar Medical Holding Corporation (ICU)**
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**SelectQuote Inc (SLQT)**
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**Tharimmune Inc (THAR)**
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**Theravance Biopharma (TBPH)**
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**Unicycive Therapeutics (UNCY)**
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**XORTX Therapeutics (XRTX)**
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**Zomedica Corp (ZOM)**
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**ZYUS Life Sciences (ZLSCF)**
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Emerging Growth Public Healthcare Company Executive Presentations
Q&A Sessions Moderated by Noble’s Analysts and Bankers
Scheduled 1×1 Meetings with Qualified Investors

Noble Capital Markets, a full-service SEC / FINRA registered broker-dealer, dedicated exclusively to serving emerging growth companies, is pleased to present the Emerging Growth Virtual Healthcare Conference, taking place April 17^th and 18^th, 2024. This virtual gathering is set to be an immersive experience, bringing together a unique blend of investors, industry leaders, and experts in the life sciences, healthcare, and medical device sectors.

Part of Noble’s Robust 2024 Events Calendar

The Emerging Growth Virtual Healthcare Conference is part of Noble’s 2024 event programming, featuring a range of c-suite interviews, in-person non-deal roadshows throughout the United States, two more sector-specific virtual equity conferences, and culminating in Noble’s preeminent in-person investor conference, NobleCon20, to be held at Florida Atlantic University in Boca Raton, Florida December 3-4. Keep an eye out for the official press release on NobleCon20 coming soon.

Check out the calendar of upcoming in-person non-deal roadshows here.

What to Expect

The Emerging Growth Virtual Healthcare Conference will feature 2 days of corporate presentations from up to 50 innovative public healthcare, biotech, and medical device companies, showcasing their latest advancements and investment opportunities. Each presentation will be followed by a fireside-style Q&A session proctored by one of Noble’s analyst or bankers, with questions taken from the audience during the presentation. Panel presentations are planned, featuring key opinion leaders in the healthcare sector, providing valuable insights on emerging trends. Scheduled one-on-one meetings with public company executives, coordinated by Noble’s dedicated Investor Outreach team, are also available to qualified investors.

Why Your Company Should Present

Looking to increase awareness in your company and increase liquidity? Paid participation in Noble’s investor conferences, both virtual and in-person, provides that opportunity, with a tailored experience aimed at delivering substantial value. After 40 years of serving emerging growth companies, and the investors who follow them, Noble has built an investor base eager to discover where the next success story lies.

Noble’s investor base is relevant and, in many cases, new to your company. Noble’s dedicated Investor Outreach team provides unmatched exposure to investors that can invest in your company, including small money managers, family offices, RIAs, wealth managers, self-directed investors, and institutions. Most of Noble’s investors specifically seek undervalued, overlooked, emerging investment opportunities.

The cost to present includes your corporate presentation with a Q&A session proctored by one of Noble’s analysts or bankers, a webcast recording, scheduled 1×1 meetings with qualified investors, and marketing on Channelchek.

Benefits for Investors

The emerging growth healthcare space may be poised for a breakout year. The recent dislocation in the healthcare and biotech spaces has created compelling valuation profiles for many companies. Hear directly from the c-suite of the next innovators in this space and learn about new investment opportunities. The Q&A portion of each presentation gives you the opportunity to have your questions answered during or after the proctored session. The planned panel presentations are sure to provide expert insight on growing trends in the healthcare space. And, for qualified investors, one-on-one meetings are available with company executives; scheduled by Noble’s dedicated Investor Outreach team. All from the comfort of your own desk, and at no cost.

How to Register

Limited presenting slots are available

Publicly traded companies in the healthcare space can submit their registration details here.

If you have any questions about presenting, please contact events@noblecapitalmarkets.com

Investor / Guest attendees can register here

Interested in becoming a sponsor of Noble’s virtual and in-person investor conferences?

Contact events@noblecapitalmarkets.com for sponsorship information.

The New York Stock Exchange’s Bold Proposal for 24/7 Trading: Risks and Opportunities

Posted on April 25, 2024April 25, 2024 by slightbourne@noblecapitalmarkets.com

The New York Stock Exchange (NYSE), the iconic centerpiece of global finance, is exploring a groundbreaking shift that could reshape how stock markets operate worldwide. The proposal to transition to 24/7 trading is a bold move that promises both opportunities and challenges for investors and market participants alike.

The Lure of Continuous Trading
The driving force behind the NYSE’s consideration of round-the-clock trading is the desire to align with the increasingly global and interconnected nature of modern financial markets. As the world’s economic activities continue to transcend time zones, the traditional trading hours impose limitations on investors’ ability to react swiftly to events that could significantly impact stock prices.

By embracing a 24/7 trading model, the NYSE aims to democratize access, allowing investors across the globe to participate in the markets at their convenience. This could potentially enhance liquidity and market efficiency, providing a more seamless flow of capital and pricing information.

Moreover, the rise of digital currencies and their associated markets, which operate continuously, has set a precedent that traditional stock exchanges are keen to emulate. The promise of reducing volatility at market openings, as news and events would be immediately reflected in stock prices, is an enticing proposition for advocates of 24/7 trading.

Navigating Potential Risks
However, this revolutionary shift is not without its challenges and concerns. One significant apprehension is the potential for increased price volatility, particularly during off-peak hours when trading volumes may be lower. Uninformed or less experienced investors could face substantial risks if prices swing erratically due to lower liquidity or unforeseen events.

The NYSE’s survey specifically probes for mechanisms to safeguard against such volatility, underscoring the need for robust investor protection measures in a 24/7 trading environment. Regulatory bodies, such as the Securities and Exchange Commission (SEC), will play a pivotal role in shaping the framework and rules to mitigate risks and ensure market integrity.

Operational and logistical demands pose another significant hurdle. Staffing for overnight sessions, upgrading technical infrastructure, and overhauling clearing house operations to accommodate non-stop trading will require substantial investments and coordination across the financial ecosystem.

Implications for Investors and Markets
If the NYSE successfully navigates these challenges and implements 24/7 trading, the implications for investors could be far-reaching. Individual investors may benefit from increased flexibility, as they would no longer be constrained by traditional trading hours. This could democratize access to market opportunities, allowing investors to react more swiftly to global events that could impact their portfolios.

However, the potential for increased volatility during off-peak hours could pose risks for less experienced or risk-averse investors. Prudent investors may need to adjust their strategies and risk management approaches to account for the possibility of sudden price swings during overnight trading sessions.

For institutional investors and market makers, 24/7 trading could present both opportunities and challenges. While continuous access to markets could enable more efficient portfolio management and risk hedging, it may also necessitate adjustments to staffing, trading algorithms, and risk management protocols to accommodate round-the-clock operations.

Moreover, the transition to 24/7 trading could have broader implications for market dynamics and behavior. With the traditional opening and closing bell ceremonies no longer demarcating trading sessions, the psychological and behavioral factors that influence market participants may evolve. Investors and traders may need to adapt their decision-making processes and strategies to account for the absence of these temporal anchors.

Conclusion
The NYSE’s exploration of 24/7 trading represents a pivotal moment in the evolution of financial markets. While the potential benefits of continuous trading, such as increased liquidity and market efficiency, are appealing, the industry must carefully navigate the associated risks and challenges.

As the world moves towards a more interconnected and digitized financial landscape, the future of trading may indeed lie in a 24/7 model. However, achieving this paradigm shift will require collaboration among exchanges, regulators, and market participants to ensure investor protection, operational readiness, and market stability.

The road ahead may be arduous, but the prospect of more accessible, efficient, and globally inclusive markets could usher in a new era of trading that better serves the needs of a rapidly evolving financial ecosystem.

Corporate America Braces for Seismic Shift as FTC’s Noncompete Ban Kicks In

Posted on April 25, 2024April 25, 2024 by slightbourne@noblecapitalmarkets.com

In a groundbreaking move that could reshape the dynamics of the American workforce, the Federal Trade Commission has fired a shot across the bow of Corporate America by enacting a near-total ban on noncompete agreements. The new regulation promises to upend long-standing business practices and trigger sweeping ramifications for companies, investors, and millions of workers.

On Tuesday, the FTC’s commissioners voted 3-1 to prohibit employers from imposing noncompete clauses that restrict workers from leaving for a rival firm. The ban applies not only to future contracts but also requires companies to nullify existing noncompete agreements, with few exceptions allowed for some highly-paid executives.

The rationale, according to the FTC, is that such clauses suppress wages, hamper innovation, and deprive workers of economic freedoms by limiting their career mobility and ability to pursue better opportunities. It’s an expansive assertion of regulatory power spotlighting the Biden administration’s pro-labor policy agenda.

“Companies with extraordinary leverage over employees shouldn’t be able to squeeze Americans with noncompetes that are often offered on a take-it-or-leave-it basis,” FTC Chair Lina Khan declared. “Today’s vote helps restore workers’ countervailing bargaining power and freedom of mobility.”

But the new edict is already facing a backlash from powerful business groups like the U.S. Chamber of Commerce, which have accused the FTC of overstepping its legal authority. Within 24 hours, they filed a federal lawsuit seeking to block the “staggeringly overbroad” ban.

“This represents a startling regulatory overreach and stretches the FTC’s authority far beyond what Congress could ever have intended,” said Jeffrey Shapiro, a noncompete law expert at FCW Partners. “It will likely be bogged down in the courts for years.”

If the ban withstands the expected legal challenges, experts say the ripple effects could be seismic across a wide range of industries that have long leveraged noncompete clauses to protect trade secrets and retain top talent:

Tech Giants Face Talent Drain
Major tech hubs like Silicon Valley, Seattle and Austin could see a free-for-all in the battle for engineering and product talent no longer restricted by noncompete strictures. This could accelerate attrition at the FAANG companies and disrupt the aggressive recruiting tactics they’ve leaned on to poach stars. Public tech stock valuations may have to be reevaluated.

Manufacturing Risks Rise
Automakers and aerospace manufacturers that have stringently guarded R&D and intellectual property using noncompetes worry about a brain drain to rivals or upstart competitors. Smaller industrial firms may have to rethink business strategies if they can no longer tie down key personnel.

Healthcare Industry Upheaval
The healthcare industry, notorious for its aggressive use of noncompete language, could be turned upside down. Major hospital systems and staffing firms may struggle to retain nurses, doctors and specialists who can now seamlessly jump ship to competing practices or startups. Costs may spike for replacing those who exit.

While noncompete agreements faced growing restrictions in several states, the FTC’s action goes much further in seeking to eliminate them nationwide outside of very narrow circumstances. The resulting purge could catalyze significant workforce churn across the corporate landscape.

“Employers, investors and the markets have to prepare for severe disruption if this ban sticks,” said Eric Sibbitt, CEO of data analytics firm O*NET OnLine. “Holding onto your most valuable human capital will become exponentially harder.”

Whether it triggers an unleashing of professional talent or catastrophic defections of prized workers will be the multi-billion dollar question facing Corporate America. Buckle up for a brave new world of unrestricted job-hopping.

Release – NN, Inc. To Hold First Quarter 2024 Earnings Conference Call On Tuesday, May 7, 2024

Posted on April 24, 2024April 24, 2024 by aweinsoff@channelchek.com

Research News and Market Data on NNBR

CHARLOTTE, N.C., April 24, 2024 (GLOBE NEWSWIRE) — NN, Inc. (NASDAQ: NNBR), a global diversified industrial company that engineers and manufactures high-precision components and assemblies, announced today that it will release its first quarter 2024 financial results for the period ended March 31, 2024, after the close of the market on Monday, May 6, 2024. The company will hold a related conference call on Tuesday, May 7, 2024, at 9 a.m. E.T. Participants on the call are asked to register five to 10 minutes prior to the scheduled start time by dialing 1-877-255-4315 and from outside the U.S. at 1-412-317-6579.

The conference call will be webcast simultaneously and in its entirety through the NN, Inc. Investor Relations website. Shareholders, media representatives and others may participate in the webcast by registering through the Investor Relations section on the company’s website at https://investors.nninc.com/.

For those who are unavailable to listen to the live call, a replay will be available shortly after the call on NN’s website through May 7, 2025.

About NN, Inc.

NN, Inc., a global diversified industrial company, combines advanced engineering and production capabilities with in-depth materials science expertise to design and manufacture high-precision components and assemblies for a variety of markets on a global basis. Headquartered in Charlotte, North Carolina, NN has facilities in North America, Europe, South America, and Asia. For more information about the company and its products, please visit www.nninc.com.

Investor & Media Contacts:
Joe Caminiti or Stephen Poe, Investors
Tim Peters, Media
NNBR@alpha-ir.com 312-445-2870

Source: NN, Inc.

Release – Kelly Announces First-Quarter 2024 Conference Call

Posted on April 24, 2024April 24, 2024 by aweinsoff@channelchek.com

Research News and Market Data on KELYA

April 24, 2024

TROY, Mich., April 24, 2024 (GLOBE NEWSWIRE) — Kelly, a leading global specialty talent solutions provider, will release its first-quarter earnings before the market opens on Thursday, May 9, 2024. In conjunction with its first-quarter earnings release, Kelly will publish a financial presentation on the Investor Relations page of its public website and will host a conference call at 9 a.m. ET.

The call may be accessed in one of the following ways:

Via Internet:
kellyservices.com

Via the Telephone
(877) 692-8955 (toll free) or (234) 720-6979 (caller paid)
Enter access code 5728672
After the prompt, please enter “#”

A recording of the conference call will be available after 1:30 p.m. ET on May 9, 2024, at (866) 207-1041 (toll-free) and (402) 970-0847 (caller-paid). The access code is 5728672#. The recording will also be available at kellyservices.com during this period.

About Kelly

Kelly Services, Inc. (Nasdaq: KELYA, KELYB) helps companies recruit and manage skilled workers and helps job seekers find great work. Since inventing the staffing industry in 1946, we have become experts in the many industries and local and global markets we serve. With a network of suppliers and partners around the world, we connect more than 500,000 people with work every year. Our suite of outsourcing and consulting services ensures companies have the people they need, when and where they are needed most. Headquartered in Troy, Michigan, we empower businesses and individuals to access limitless opportunities in industries such as science, engineering, technology, education, manufacturing, retail, finance, and energy. Revenue in 2023 was $4.8 billion. Learn more at kellyservices.com.

KLYA-FIN

Analyst & Media Contact:
Scott Thomas
(248) 251-7264
scott.thomas@kellyservices.com

Release – Travelzoo Reports First Quarter 2024 Results

Posted on April 24, 2024April 24, 2024 by aweinsoff@channelchek.com

Research News and Market Data on TZOO

NEW YORK, April 24, 2024 /PRNewswire/ — Travelzoo® (NASDAQ: TZOO):

Revenue of $22.0 million, up 2% year-over-year
Consolidated operating profit of $5.6 million
Non-GAAP consolidated operating profit of $6.0 million
Cash flow from operations of $4.6 million
Earnings per share (EPS) of $0.31

Travelzoo, the club for travel enthusiasts, today announced financial results for the first quarter ended March 31, 2024. Consolidated revenue was $22.0 million, up 2% from $21.6 million year-over-year. In constant currencies, revenue was $21.8 million, up 1% year-over-year. Travelzoo’s reported revenue consists of advertising revenues and commissions, derived from and generated in connection with purchases made by Travelzoo members, and membership fees.

Net income attributable to Travelzoo was $4.2 million for Q1 2024, or $0.31 per share, compared with $0.23 in the prior-year period. Net income attributable to Travelzoo from continuing operations was $4.2 million for Q1 2024, or $0.31 per share, compared with $0.23 in the prior-year period.

Non-GAAP operating profit was $6.0 million. Non-GAAP operating profit excludes amortization of intangibles ($0.3 million) and stock option expenses ($95,000). Please refer to “Non-GAAP Financial Measures” and the tabular reconciliation below.

“We will continue to leverage Travelzoo’s global reach, trusted brand, and strong relationships with top travel suppliers to negotiate more exclusive offers for members,” said Holger Bartel, Travelzoo’s Global CEO. “It is in times of large increases in travel prices that Travelzoo is most valuable for consumers. Travelzoo members enjoy high quality travel experiences that represent outstanding value.”

“With more than 30 million members, 8 million mobile app users, and 4 million social media followers, Travelzoo is loved by travel enthusiasts who are affluent, active, and open to new experiences.”

Cash Position
As of March 31, 2024, consolidated cash, cash equivalents and restricted cash were $16.9 million. Net cash provided by operations was $4.6 million.

Travelzoo North America
North America business segment revenue decreased 4% year-over-year to $14.2 million. Operating profit for Q1 2024 was $4.4 million, or 31% of revenue, compared to operating profit of $4.5 million in the prior-year period.

Travelzoo Europe
Europe business segment revenue increased 13% year-over-year to $6.7 million. In constant currencies, Europe business segment revenue increased 10% year-over-year. Operating profit for Q1 2024 was $1.4 million, or 21% of revenue, compared to operating profit of $457,000 in the prior-year period.

Jack’s Flight Club
Jack’s Flight Club is a membership subscription service in which Travelzoo has a 60% ownership interest. Revenue from unaffiliated customers increased 16% year-over-year to $1.1 million. The number of premium subscribers increased 11% year-over-year. Jack’s Flight Club’s revenue from subscriptions is recognized ratably over the subscription period (quarterly, semi-annually, annually). Non-GAAP operating loss for Q1 2024 was $24,000, compared to a non-GAAP operating profit of $123,000 in the prior-year period. Non-GAAP operating loss excludes amortization of intangibles ($75,000) related to the acquisition of Travelzoo’s ownership interest in Jack’s Flight Club in 2020. The Q1 2024 operating loss was caused by marketing expenses in connection with growth in members.

New Initiatives
New Initiatives business segment revenue, which includes Licensing and Travelzoo META, was $32,000. Operating loss for Q1 2024 was $130,000.

In June 2020, Travelzoo entered into a royalty-bearing licensing agreement with a local licensee in Japan for the exclusive use of Travelzoo’s brand, business model, and members in Japan. In August of 2020, Travelzoo entered into a royalty-bearing licensing agreement with a local licensee in Australia for the exclusive use of Travelzoo’s brand, business models, and members in Australia, New Zealand, and Singapore. Under these arrangements, Travelzoo’s existing members in Australia, Japan, New Zealand, and Singapore will continue to be owned by Travelzoo as the licensor. Travelzoo recorded $7,000 in licensing revenue from the licensee in Japan in Q1 2024. Travelzoo recorded $10,000 in licensing revenue from the licensee in Australia, New Zealand, and Singapore in Q1 2024. Licensing revenue is expected to increase going forward.

Members and Subscribers
As of March 31, 2024, we were 31.0 million members worldwide, up from 30.5 million as of March 31, 2023. In North America, Travelzoo had 16.2 million unduplicated members as of March 31, 2024, down from 16.3 million as of March 31, 2023. In Europe, Travelzoo had 9.2 million unduplicated members as of March 31, 2024, up from 9.1 million as of March 31, 2023. Jack’s Flight Club had 2.4 million subscribers as of March 31, 2024, up from 2.0 million as of March 31, 2023.

Discontinued Operations
In March 2020, Travelzoo decided to exit its Asia Pacific business and operate it as a licensing business going forward. Consequently, the Asia Pacific business has been classified as discontinued operations.

Income Taxes
A provision of $1.5 million for income taxes was recorded for Q1 2024, compared to an income tax expense of $1.4 million in the prior-year period. Travelzoo intends to utilize available net operating losses (NOLs) to largely offset its actual tax liability for Q1 2024.

Looking Ahead
For Q2 2024, we expect continued growth in revenue year-over-year, albeit at a smaller pace than in 2023. We also expect for Q2 2024 higher profitability year-over-year. In December 2023, we announced the introduction of a membership fee for Travelzoo beginning January 1, 2024. We recognize membership fee revenue ratably over the subscription period. Legacy Travelzoo members as of December 31, 2023 are exempt from the fee during 2024. Therefore, we do not anticipate to generate membership fee revenue from these members before 2025.

Non-GAAP Financial Measures
Management calculates non-GAAP operating income when evaluating the financial performance of the business. Travelzoo’s calculation of non-GAAP operating income, also called “non-GAAP operating profit” in this press release and today’s earnings conference call, excludes the following items: impairment of intangible and goodwill, amortization of intangibles, stock option expenses and severance-related expenses. This press release includes a table which reconciles GAAP operating income to the calculation of non-GAAP operating income. Non-GAAP operating income is not required by, or presented in accordance with, generally accepted accounting principles in the United States of America (“GAAP”). This information should be considered as supplemental in nature and should not be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similarly titled measures reported by other companies.

Conference Call
Travelzoo will host a conference call to discuss first quarter 2024 results today at 11:00 a.m. ET. Please visit http://ir.travelzoo.com/events-presentations to

download the management presentation (PDF format) to be discussed in the conference call
access the webcast.

About Travelzoo
We, Travelzoo®, are the club for travel enthusiasts. Our 30 million members receive 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.

Certain statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations, prospects and intentions, markets in which we participate and other statements contained in this press release that are not historical facts. When used in this press release, the words “expect”, “predict”, “project”, “anticipate”, “believe”, “estimate”, “intend”, “plan”, “seek” and similar expressions are generally intended to identify forward-looking statements. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including changes in our plans, objectives, expectations, prospects and intentions and other factors discussed in our filings with the SEC. We cannot guarantee any future levels of activity, performance or achievements. Travelzoo undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.

Investor Relations:
ir@travelzoo.com

View full release here.

SOURCE Travelzoo

The End of TikTok in the US As We Know It?

Posted on April 24, 2024April 24, 2024 by slightbourne@noblecapitalmarkets.com

In a historic move with far-reaching implications, President Joe Biden signed into law a bipartisan bill on Wednesday that gives Chinese company ByteDance one year to sell or spin off its wildly popular video app TikTok. Failure to comply would result in an outright ban of the app across the United States.

The new legislation marks a dramatic escalation in the ongoing tensions between Washington and Beijing over technology and national security. It thrusts TikTok into the center of a geopolitical tug-of-war that could reshape the internet landscape and social media as we know it.

“This is another front in the brewing US-China tech Cold War that started under the previous administration,” said Stephen Weymouth, a business professor at Georgetown University. “Congress is taking an increasingly aggressive regulatory stance that we haven’t seen before with tech companies.”

At the core of the issue are concerns from US officials that ByteDance, as a Chinese company, could be compelled to hand over TikTok’s data on American users or manipulate content on the influential platform at the behest of Beijing – allegations that TikTok has vehemently denied.

The new law sets the stage for a high-stakes game of brinksmanship between ByteDance and Washington over the next 12 months. The company now faces an agonizing decision: sell off TikTok’s US operations and bid farewell to one of the world’s most lucrative markets, or refuse to comply and risk getting booted out entirely.

“TikTok is going to fight tooth and nail. Banning or forcing a sale would be devastating for them and silence 170 million American voices,” a TikTok spokesperson warned after Biden’s signing. The company has signaled it plans to mount a vigorous legal challenge.

If ByteDance does opt to sell, finding an acceptable buyer could prove complicated. While some investors like former Trump official Steven Mnuchin have expressed interest, concerns remain over whether China would greenlight exporting TikTok’s prized algorithm that drives the addictive video feed.

Valued at potentially over $100 billion, any sale would rank among the largest tech deals ever and a huge windfall for ByteDance’s investors. But without the core technology, TikTok’s allure and price tag would plummet.

The implications extend far beyond just TikTok itself. A US ban could embolden others like India to follow suit and fracture the internet even further along geopolitical faultlines. It could also hasten a broader decoupling of technology supply chains away from China.

For the over 170 million American TikTok users and legions of influencers and businesses hosted on the app, it casts a pall of uncertainty. “Devastation” is how TikTok described the toll a potential ban could take.

In many respects, the TikTok fight has become a touchstone in the intensifying rivalry between the US and China for technological supremacy in the 21st century – with huge economic and security stakes.

“We hope TikTok can live on under new ownership outside China’s control,” said Senator Mark Warner, a key architect of the bill. “But one way or another, we cannot allow data security on Americans to be jeopardized by foreign adversary.”

With the clock now ticking for ByteDance, TikTok’s future in the US will be one of the biggest tech stories to watch over the coming year. Its fate could have far-reaching and lasting impacts on the internet we all use.

Register Now to Attend.
Noble Capital Markets Emerging Growth Virtual Consumer, Media & Technology Conference on June 26-27, 2024

Presenting slots are available

Direct Digital Holdings (DRCT) – Marcum Gives A Bad Impression

Posted on April 24, 2024April 24, 2024 by cpereira@noblefcm.com

Wednesday, April 24, 2024

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.

Non-compliance notice. On April 17 the company was not able to file its 10-K on time, and, subsequently, received a notification of non-compliance from NASDAQ. Notably, the company has 30 days to submit an actionable plan to regain compliance. Importantly, the failure to file its 10-K on time was attributed to the inability of its auditor, Marcum, to verify impressions data.

New auditor expected soon. Marcum is terminating its relationship with the company, citing its inability to verify the company’s impressions data. Importantly, we expect the company to sign a top 10 US accounting firm within the 30-day window. The audit should be able to ramp quickly, given that the company will be able to provide timely access to all the data the was requested by the previous auditor. Additionally, we expect Nasdaq will accept its plan and grant the company up to 6 months to complete the10-K filing, as well as its first quarter 10-Q filing.

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