Kelly (Nasdaq: KELYA, KELYB) connects talented people to companies in need of their skills in areas including Science, Engineering, Education, Office, Contact Center, Light Industrial, and more. We’re always thinking about what’s next in the evolving world of work, and we help people ditch the script on old ways of thinking and embrace the value of all workstyles in the workplace. We directly employ nearly 350,000 people around the world and connect thousands more with work through our global network of talent suppliers and partners in our outsourcing and consulting practice. Revenue in 2021 was $4.9 billion. Visit kellyservices.com and let us help with what’s next for you.
Joe Gomes, Managing Director – Generalist 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.
Expanded Product Offering. Yesterday,Kelly became the first staffing provider to deploy digital workers in addition to human workers. The Company announced the launch of Kelly Fusion Digital Workers, the first product in the Kelly Fusion suite of solutions that automate routine tasks and allow employees to focus on more meaningful work. Offered as a managed service solution, Kelly Fusion is expected to generate incrementally higher gross profit rates than the traditional staffing services business. Notably, Kelly already has already secured its first client win.
Kelly Fusion. Kelly Fusion Digital Workers are powered by the latest automation software and custom-built for Kelly clients to complete repetitive tasks. They can reliably manage data entry tasks and new-hire processes such as background screenings and onboarding procedures. Kelly Fusion Digital Workers ensure work is completed efficiently, increase compliance, reduce risk, save money, eliminate mundane work, and improve the overall employee experience.
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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.
Beasley Broadcast Group, Inc. owns and operates 61 stations (47 FM and 14 AM) in 15 large- and mid-size markets in the United States. Approximately 20 million consumers listen to the Company’s radio stations weekly over-the-air, online and on smartphones and tablets, and millions regularly engage with the Company’s brands and personalities through digital platforms such as Facebook, Twitter, text messaging, digital and web applications and email. The Overwatch League’s Houston Outlaws esports team is a wholly owned subsidiary. The Company also owns BeasleyXP, a national esports content hub, and AXLR-R8, a Rocket League Championship Series team, in its esports portfolio. For more information, please visit www.bbgi.com.
Michael Kupinski, Director of Research, 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.
Non-deal roadshow highlights. CEO Caroline Beasley and CFO Marie Tedesco were in South Florida on April 4th to hold investor meetings. They provided a surprising positive update on Q1 and indicated favorable trends on its digital strategy.
Beating its peers. Management updated its Q1 outlook indicating that net revenue will grow in the range of 1% to 2.5% and EBITDA growth in the range of 40% to 50%, significantly better than our estimate. We believe that these results will be much better than the industry Q1 revenue, expected to be down 2% to 5% and with EBITDA lower. We raised our Q1 estimates, illustrated in Figure #1 Revisions.
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.
What Binance’s US Lawsuit Says About the Future for Cryptocurrency Regulation
The world’s largest cryptocurrency exchange, Binance, has been hit with a lawsuit by US regulator the Commodity Futures Trading Commission (CFTC). This is not the first time a cryptocurrency exchange has been charged by a regulator. But this particular case involves a regulator that does not directly oversee cryptocurrencies. This indicates how regulators – particularly those in the US – hope to clamp down on the cryptocurrency industry.
The CFTC’s lawsuit alleges that Binance violated US derivatives laws by offering its derivative trading services to US customers without registering with the right market regulators. It says Binance has prioritised commercial success over regulatory compliance.
The CFTC has also levied charges against Binance’s founder and CEO, Changpeng Zhao (known as CZ) and former chief compliance officer Samuel Lim. They are charged with taking steps to violate US laws, including directing US-based “VIP customers” to open Binance accounts under the name of shell companies. The regulator has pointed to chat messages as evidence of CZ and Sim’s knowledge of various criminal groups using the exchange.
People visit Binance nearly 15 million times a week to trade on the over 300 cryptocurrencies it offers in more than 1,600 different markets. CZ is an outspoken advocate for cryptocurrencies and regularly tweets about the industry and his company. He even tweeted a link to his initial response to the recent CFTC charges, which he called “unexpected and disappointing”. Promising full responses in due time, he said:
Upon an initial review, the complaint appears to contain an incomplete recitation of facts, and we do not agree with the characterization of many of the issues alleged in the complaint.
Last year CZ’s tweets arguably contributed to the collapse of FTX, one of his company’s main rivals. Binance saw its market share grow following FTX’s collapse.
So, this charge – against not only a crypto giant but also the company of an outspoken industry advocate – has created further upheaval in a market that has already suffered multiple crises in the last year. Investors withdrew a reported US$1.6 billion (£1.3 billion) from Binance within days of the CFTC’s announcement of its charges. These outflows could continue if US regulators tighten their squeeze on crypto companies further, causing major players like Binance to shift focus to other jurisdictions.
Creeping Oversight
The CFTC aims to “protect the public from fraud, manipulation, and abusive practices related to the sale of commodity and financial futures and options, and to foster open, competitive, and financially sound futures and option markets”. Previous actions by this regulator in 2021 against Tether and Bitfinex resulted in major fines and a loss of credibility for the crypto industry.
But a statement published at the time by one of the CFTC’s five commissioners, Dawn Stump, pointed out that the CFTC doesn’t actually have responsibility for regulating cryptocurrencies. She warned that these fines might “cause confusion about the CFTC’s role in this area”. She said the action was based on defining stablecoins (a type of cryptocurrency) as a commodity, but: “we should seek to ensure the public understands that we do not regulate stablecoins and we do not have daily insight into the businesses of those who issue such”.
These latest charges against Binance focus on its activities in derivatives – financial contracts that are linked to the value of an asset such as oil or, in this case, cryptocurrencies. This is a market the CFTC does regulate.
Another US financial regulator, the Securities and Exchange Commission (SEC), has also been ramping up its crypto oversight activities. As well as focusing on the Initial Coin Offering market, it saw a 50% increase in enforcement actions against digital asset companies last year compared to 2021.
Crypto Market Changes
So, Binance is up against two powerful US financial regulators. Some experts have warned that “significant regulatory action could prompt Binance to increasingly shift its business operations beyond the United States”. Certainly, the fact that Binance held a 92% share of the crypto market at the end of 2022 means it facilitates many transactions and offers a lot of liquidity to traders around the world, including in the US.
A trader’s capacity to find competitive prices when buying and selling, as well as sources of liquidity (or other people to trade with) would be affected by the loss of or pull back of one of the world’s top ten crypto exchanges. This would be bad news for retail and institutional investors who could be confronted with a smaller and potentially more expensive market as a result.
And even if the complaints and investigations by the CFTC and SEC take a while to conclude, as is likely, the US legislature may step in before that. A report published by the Financial Times days after the CFTC announcement alleges that Binance has hidden links to China for many years. A statement issued by the the exchange to the FT said this is not “an accurate picture of Binance’s operations” and that the paper’s sources were “citing ancient history (in crypto terms)”.
But recent actions against Chinese tech company Huawei and social media platform Tiktok indicate political leaders are keen to crack down on Chinese companies’ access to US technology systems and customer data. So any similar concerns could lead US politicians to start acting in this area as well.
This article was republished with permission from The Conversation, a news site dedicated to sharing ideas from academic experts. It represents the research-based findings and thoughts of Andrew Urquhart, Professor of Finance & Financial Technology, ICMA Centre, Henley Business School, University of Reading and Hossein Jahanshahloo, Assistant Professor in Finance, Cardiff University.
Could Small Oil Companies Perform Especially Well With OPEC’s Reduced Output
Earlier this week, OPEC+ announced the cartel’s plans for production cuts. Saudi Arabia and other oil-producing members of OPEC+ defied expectations by announcing they would implement production cuts of around 1.1 million barrels a day. Prices of WTI and Brent crude quickly moved higher in the futures market – energy stocks followed. The increased cost of petroleum directly impacts the price of fuel and plastics and indirectly impacts goods that involve transportation – which is mostly all goods.
The decision by OPEC+ is highly likely to put upward pressure on CPI and PPI inflation measures as early as April. The CPI report for April will be released on May 10, and PPI on May 11. Id there good news for investors in the OPEC decision? What stocks might investors look at as potentially benefiting, assuming the OPEC countries adhere to the new production levels?
Background
U.S. markets were not open when the Organization of Petroleum Exporting Countries announced the large cut of over one million barrels per day. When regular trading resumed in the U.S. on Monday, oil prices jumped up 6.3%, and crude oil prices breached $80. Energy stocks, as measured by the Energy Sector SPDR (XLE) rose 4.5%. The price of crude based on futures contracts and the XLE have remained near these levels.
With change comes opportunity. Investors and traders are now trying to determine if this is the start of a new upward trend for the energy sector and, if so, what specific moves may benefit investors most.
One consideration they may have is that, although OPEC is cutting production, the members aren’t the only producers. Historically, domestic production was increased in N. America when prices climbed. This has been less so in recent years as the number of U.S. rigs operating hasn’t increased as might have been expected.
Will this dramatic price spike now prompt action from domestic producers? In his Energy Industry Report published on April 4, titled Why Domestic Producers Cannot Offset OPEC Production Cuts, Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, says that oil is produced in the U.S. at around $30-$40 per barrel. Heim says in his report, “If producers had the ability to ramp up drilling, we would have thought they would have done so even at $60/bbl. prices.”
Possible Beneficiaries
According to the Noble Analyst, large producers have been constrained from growing their oil operations which stems from political and even shareholder pressures to move away from carbon-based energy products. However, Heim says in his report, “Smaller producers face less pressure. Companies with ample acreage and drilling prospects are best positioned to take advantage of a prolonged oil price upcycle.”
In a conversation with the analyst, he shared that when oil prices spiked during the second half of the pandemic and later had added upward movement with the start of the Russia/Ukraine war, many small oil companies took in enough additional revenue to strengthen their finances. Some even began paying dividends for the first time, while others increased their regular dividend to shareholders.
These smaller oil producers not in the political spotlight that may reap additional benefits from OPEC’s cut could include Hemisphere Energy (HMENF). This company increased production by 55% in 2022. According to a research report by Noble Capital Markets initiating coverage on Hemisphere (dated April 3, 2023), “proven reserve findings and development costs are less than C$12/barrel, providing an extremely attractive return on investment for drilling.” It continued, “Hemisphere’s finding and development costs are among the lowest of western Canadian producers and reflect its favorable drilling locations and the company’s experience drilling in the area.” The increase in price per barrel could enhance cash flow for this North American producer, allowing it to expand production.
Permex Petroleum (OILCD, OIL.CN) is a junior oil and gas company that already had a significant upside potential before the jump in per-barrel prices. This boost in cash from higher oil prices and a possible uplisting to the NYSE, could work to benefit shareholders.
InPlay Oil (IPOOF) increased annual production last year by 58%. InPlay is an example of a smaller producer that has been able to increase drilling when prices rise. It has used increased cash flow to lower debt levels by 59% and pay shareholders with its first dividend payment.
Indonesia Energy Corporation Ltd. (INDO) is an oil and gas exploration and production company operating in Indonesia. The company plans on drilling 18 wells in the Kruh Block (four have been completed). Covid19 steps in the region where Indo Energy operates have pushed back drilling that was expected in 2023-2024 one year.
Take Away
With change comes opportunity. Higher oil prices will impact all of us that must still occasionally stop our internal combustion engine vehicles at gas stations. But the oil price increase may lead to a melting up of some stocks.
There are arguments that can be made that smaller, more nimble producers, not burdened by the political spotlight and perhaps enjoying a better financial position from the last run-up in oil, are worth looking into. A Channelchek search returned over 200 companies that may fall into this category. This search result is available here.
CALGARY, AB, April 3, 2023 /CNW/ – InPlay Oil Corp. (TSX: IPO) (OTCQX: IPOOF) (“InPlay” or the “Company”) is pleased to confirm that its Board of Directors has declared a monthly cash dividend of $0.015 per common share payable on April 28, 2023, to shareholders of record at the close of business on April 17, 2023. The monthly cash dividend is expected to be designated as an “eligible dividend” for Canadian federal and provincial income tax purposes.
About InPlay Oil Corp.
InPlay is a junior oil and gas exploration and production company with operations in Alberta focused on light oil production. The company operates long-lived, low-decline properties with drilling development and enhanced oil recovery potential as well as undeveloped lands with exploration possibilities. The common shares of InPlay trade on the Toronto Stock Exchange under the symbol IPO and the OTCQX Exchange under the symbol IPOOF.
TORONTO, April 04, 2023 (GLOBE NEWSWIRE) — Labrador Gold Corp. (TSX.V:LAB | OTCQX:NKOSF | FNR: 2N6) (“LabGold” or the “Company”) is pleased to announce results of its annual general meeting of shareholders held in Toronto on April 3, 2023.
At the meeting shareholders re-elected five current directors, being Roger Moss, James Borland, Trevor Boyd, Leonidas Karabelas and Kai Hoffmann and approved the re-appointment of DeVisser Gray LLP, of Vancouver, British Columbia, as auditors of the Corporation. Shareholders also ratified the 2021 Stock Option Plan and approved the Corporation’s new 2023 Stock Option Plan which supercedes and replaces the 2021 Stock Option Plan.
Following the shareholder meeting the Board of Directors reconstituted its Audit Committee and also reappointed officers for the ensuing year as follows:
President and CEO: Roger Moss
Chief Financial Officer: Eric Myung
Corporate Secretary: William Johnstone
The Company also announces that in accordance with its Stock Option Plan, it has granted officers, directors, consultants and employees an aggregate of 3,100,000 incentive stock options exercisable until April 3, 2028 at $0.23 per share. The options will vest according to the following schedule, 20% on August 3, 2023, 20% on October 3, 2023, 20% on April 3, 2024, 20% on October 3, 2024 and 20% on April 3,2025.
About Labrador Gold Labrador Gold is a Canadian based mineral exploration company focused on the acquisition and exploration of prospective gold projects in Eastern Canada.
Labrador Gold’s flagship property is the 100% owned Kingsway project in the Gander area of Newfoundland. The three licenses comprising the Kingsway project cover approximately 12km of the Appleton Fault Zone which is associated with gold occurrences in the region, including those of New Found Gold immediately to the south of Kingsway. Infrastructure in the area is excellent located just 18km from the town of Gander with road access to the project, nearby electricity and abundant local water. LabGold is drilling a projected 100,000 metres targeting high-grade epizonal gold mineralization along the Appleton Fault Zone with encouraging results to date. The Company has approximately $16 million in working capital and is well funded to carry out the planned program.
The Hopedale property covers much of the Florence Lake greenstone belt that stretches over 60 km. The belt is typical of greenstone belts around the world but has been underexplored by comparison. Work to date by Labrador Gold show gold anomalies in rocks, soils and lake sediments over a 3 kilometre section of the northern portion of the Florence Lake greenstone belt in the vicinity of the known Thurber Dog gold showing where grab samples assayed up to 7.8g/t gold. In addition, anomalous gold in soil and lake sediment samples occur over approximately 40 km along the southern section of the greenstone belt (see news release dated January 25 th 2018 for more details). Labrador Gold now controls approximately 40km strike length of the Florence Lake Greenstone Belt.
The Company has 170,009,979 common shares issued and outstanding and trades on the TSX Venture Exchange under the symbol LAB.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release .
Forward-Looking Statements: This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions are intended to identify forward-looking statements. Such statements reflect our current views with respect to future events and are subject to risks and uncertainties. Many factors could cause our actual results to differ materially from the statements made, including those factors discussed in filings made by us with the Canadian securities regulatory authorities. Should one or more of these risks and uncertainties, such as actual results of current exploration programs, the general risks associated with the mining industry, the price of gold and other metals, currency and interest rate fluctuations, increased competition and general economic and market factors, occur or should assumptions underlying the forward looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, or expected. We do not intend and do not assume any obligation to update these forward-looking statements, except as required by law. Shareholders are cautioned not to put undue reliance on such forward-looking statements .
Prioritizing Clinical-Stage CNS Programs in Fibromyalgia, Depression, Migraine, and Cocaine Intoxication
Deprioritizing COVID-19 Related Programs and Pending Posttraumatic Stress Disorder (PTSD) Trial
Cash and Cash Equivalents Totaled Approximately $120.2 Million at December 31, 2022
CHATHAM, N.J., April 04, 2023 (GLOBE NEWSWIRE) — Tonix Pharmaceuticals Holding Corp. (Nasdaq: TNXP), a clinical-stage biopharmaceutical company, today announced it is reallocating resources and cash to streamline its pipeline and focus on its mid- and late-stage clinical programs within its core central nervous system (CNS) portfolio. The pipeline realignment prioritizes key near-term value drivers, reduces investment in several longer-term programs, particularly COVID-19-related studies, and delays the start of a posttraumatic stress disorder (PTSD) study in Kenya.
“We are excited to focus our efforts on the confirmatory, registration-enabling Phase 3 trial in fibromyalgia and the potentially pivotal Phase 2 trials for chronic migraine and depression,” said Seth Lederman, M.D., Chief Executive Officer of Tonix Pharmaceuticals. “To increase our operational efficiency, we intend to focus resources on our CNS portfolio – which also includes an upcoming Phase 2 study in cocaine intoxication – and to deprioritize several other programs with longer timelines, particularly programs related to COVID-19. With our experienced development team, Tonix is confident in its abilities to advance its diverse portfolio with multiple opportunities for achieving value creating milestones in 2023 and beyond.”
Key Anticipated 2023 Milestones
Interim analysis results of Phase 3 RESILIENT study of TNX-102 SL (sublingual cyclobenzaprine tablets) for fibromyalgia in the second quarter of 2023.
Interim analysis results of Phase 2 PREVENTION study of TNX-1900 (intranasal potentiated oxytocin) for chronic migraine in the fourth quarter of 2023.
Interim analysis results of Phase 2 UPLIFT study of TNX-601 ER (tianeptine hemioxalate extended-release tablets) for major depressive disorder in the fourth quarter of 2023.
Topline results of Phase 3 RESILIENT study of TNX-102 SL for fibromyalgia in the fourth quarter of 2023.
Initiate enrollment in a potentially pivotal Phase 2 study of TNX-1300 (recombinant double-mutant cocaine esterase for injection) for the emergency room reversal of the effects of cocaine intoxication.
Tonix is aligning its operational and scientific efforts on its core CNS programs and deprioritizing other programs as follows:
Central Nervous System (CNS): The Company is prioritizing the advancement of its late- and mid-stage clinical fibromyalgia, depression, migraine, and cocaine intoxication studies and delaying the start of the Kenya PTSD study. The Company has received regulatory clearance in Kenya, which will allow it to rapidly restart the PTSD program at the appropriate time. The Company is discontinuing the enrollment of new patients in a Phase 2 clinical trial in fibromyalgia-type Long COVID. The approximately 60 patients enrolled to date in the Long COVID study will be followed to completion, with topline data expected in the third quarter of 2023. The Company believes that the data from the study may guide future development and support grant applications.
Infectious Disease: The Company is continuing to advance development of TNX-801 (live virus vaccine to protect against smallpox and mpox) and its portfolio of potential broad-spectrum antiviral agents, including direct antiviral engineered proteins, TNX-4000, and the host-directed antiviral series of molecules, TNX-3900. The Company will also continue work on the recombinant pox virus (RPV) platform vector technology as a platform for rapid response to new pathogens, rather than specifically on the TNX-1800/TNX-1850 vaccines for COVID-19. Near-term preclinical work on other COVID-19 related programs, including anti-COVID antibodies TNX-3600, TNX-3800 and TNX-4100, will be deprioritized.
Immunology and Rare Disease: The Company is continuing development on TNX-1500 (a third generation anti-CD40L monoclonal antibody for prophylaxis of organ transplant rejection and treatment of autoimmune disorders), and TNX-2900 (intranasal potentiated oxytocin), a small peptide for the treatment of hyperphagia in Prader-Willi syndrome (PWS). The FDA has granted Orphan Drug designation for TNX-2900 for PWS.
Tonix Pharmaceuticals Holding Corp.*
Tonix is a clinical-stage biopharmaceutical company focused on discovering, licensing, acquiring and developing therapeutics to treat and prevent human disease and alleviate suffering. Tonix’s portfolio is composed of central nervous system (CNS), rare disease, immunology and infectious disease product candidates. Tonix’s CNS portfolio includes both small molecules and biologics to treat pain, neurologic, psychiatric and addiction conditions. Tonix’s lead CNS candidate, TNX-102 SL (cyclobenzaprine HCl sublingual tablet), is in mid-Phase 3 development for the management of fibromyalgia with interim data expected in the second quarter of 2023. TNX-102 SL is also being developed to treat Long COVID, a chronic post-acute COVID-19 condition. Enrollment of approximately 60 patients in a Phase 2 study has been completed, and topline results are expected in the third quarter of 2023. TNX-1900 (intranasal potentiated oxytocin), in development for chronic migraine, is currently enrolling with interim data expected in the fourth quarter of 2023. TNX-601 ER (tianeptine hemioxalate extended-release tablets), a once-daily formulation being developed as a treatment for major depressive disorder (MDD), is also currently enrolling with interim data expected in the fourth quarter of 2023. TNX-1300 (cocaine esterase) is a biologic designed to treat cocaine intoxication and has been granted Breakthrough Therapy designation by the FDA. A Phase 2 study of TNX-1300 is expected to be initiated in the second quarter of 2023. Tonix’s rare disease portfolio includes TNX-2900 (intranasal potentiated oxytocin) for the treatment of Prader-Willi syndrome. TNX-2900 has been granted Orphan Drug designation by the FDA. Tonix’s immunology portfolio includes biologics to address organ transplant rejection, autoimmunity and cancer, including TNX-1500, which is a humanized monoclonal antibody targeting CD40-ligand (CD40L or CD154) being developed for the prevention of allograft and xenograft rejection and for the treatment of autoimmune diseases. A Phase 1 study of TNX-1500 is expected to be initiated in the second quarter of 2023. Tonix’s infectious disease pipeline includes TNX-801, a vaccine in development to prevent smallpox and mpox, for which a Phase 1 study is expected to be initiated in the second half of 2023. TNX-801 also serves as the live virus vaccine platform or recombinant pox vaccine platform for other infectious diseases. The infectious disease portfolio also includes TNX-3900 and TNX-4000, classes of broad-spectrum small molecule oral antivirals.
*All of Tonix’s product candidates are investigational new drugs (IND) or biologics and have not been approved for any indication. TNX-801, TNX-1500, TNX-2900, TNX-3900 and TNX-4000 are in pre-IND stageof development and have not been approved for any indication.
Forward Looking Statements
Certain statements in this press release are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of forward-looking words such as “anticipate,” “believe,” “forecast,” “estimate,” “expect,” and “intend,” among others. These forward-looking statements are based on Tonix’s current expectations and actual results could differ materially. There are a number of factors that could cause actual events to differ materially from those indicated by such forward-looking statements. These factors include, but are not limited to, risks related to the failure to obtain FDA clearances or approvals and noncompliance with FDA regulations; delays and uncertainties caused by the global COVID-19 pandemic; risks related to the timing and progress of clinical development of our product candidates; our need for additional financing; uncertainties of patent protection and litigation; uncertainties of government or third party payor reimbursement; limited research and development efforts and dependence upon third parties; and substantial competition. As with any pharmaceutical under development, there are significant risks in the development, regulatory approval and commercialization of new products. Tonix does not undertake an obligation to update or revise any forward-looking statement. Investors should read the risk factors set forth in the Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the Securities and Exchange Commission (the “SEC”) on March 13, 2023, and periodic reports filed with the SEC on or after the date thereof. All of Tonix’s forward-looking statements are expressly qualified by all such risk factors and other cautionary statements. The information set forth herein speaks only as of the date thereof.
QuoteMedia is a leading software developer and cloud-based syndicator of financial market information and streaming financial data solutions to media, corporations, online brokerages, and financial services companies. The Company licenses interactive stock research tools such as streaming real-time quotes, market research, news, charting, option chains, filings, corporate financials, insider reports, market indices, portfolio management systems, and data feeds. QuoteMedia provides industry leading market data solutions and financial services for companies such as the Nasdaq Stock Exchange, TMX Group (TSX Stock Exchange), Canadian Securities Exchange (CSE), London Stock Exchange Group, FIS, U.S. Bank, Broadridge Financial Systems, JPMorgan Chase, CI Financial, Canaccord Genuity Corp., Hilltop Securities, HD Vest, Stockhouse, Zacks Investment Research, General Electric, Boeing, Bombardier, Telus International, Business Wire, PR Newswire, FolioFN, Regal Securities, ChoiceTrade, Cetera Financial Group, Dynamic Trend, Inc., Qtrade Financial, CNW Group, IA Private Wealth, Ally Invest, Inc., Suncor, Virtual Brokers, Leede Jones Gable, Firstrade Securities, Charles Schwab, First Financial, Cirano, Equisolve, Stock-Trak, Mergent, Cision, Day Trade Dash and others. Quotestream®, QModTM and Quotestream ConnectTM are trademarks of QuoteMedia. For more information, please visit www.quotemedia.com.
Michael Kupinski, Director of Research, Noble Capital Markets, Inc.
Patrick McCann, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Strong operating results. The company reported Q4 revenue of $4.54 million, up 16% year over year and in line with our estimate. Adj. EBITDA was $869,000, beating our estimate of $690,000. Q4 revenue growth was sequentially better than Q3, 16% versus 15%, indicating improved revenue momentum.
Favorable outlook. The recent results benefited from two large Canadian banks added in November of last year. As such, the full revenue impact has not been fully realized. In addition, the company anticipates that there will be additional products and usage to drive revenue growth in 2023. Finally, the latest results were adversely affected by the expense of SOC2 Type II certification, which should moderate in coming quarters.
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.
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
Joe Gomes, Managing Director – Generalist 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.
Board Changes. Yesterday, FAT Brands announced a nearly wholesale change to its Board. We believe the changes were made in an effort to help separate the Company from the ongoing derivative lawsuits and the government investigation, as well as give the still to be appointed new CEO a “clean slate” to execute the business plan. In addition, FAT Brands elected “controlled company” status for purposes of the government governance rules. While always a controlled company, FAT Brands had previously elected to follow the “majority of independent directors” rule. The move to “controlled company” status could save the Company about $1 million per year.
The New Board. Of the former directors, only Andrew Wiederhorn and Lynne Collier remain. Additions to the Board include five insiders, including Mr. Wiederhorn’s three sons, all of whom hold leadership positions at FAT Brands, and three independent directors — Mark Elenowitz, Kenneth Kepp, and Tyler Child.
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.
Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.
Refer to the bottom of the report for important disclosures
OPEC cut boosts oil prices and energy stocks, offsetting last quarter’s underperformance in one day. OPEC announced a 1 million bbls./day voluntary production cut causing oil prices to rise 6.3% to a level near $80/bbl. and the XLE Energy Index to rise 4.5% the day after the announcement.
If domestic producers had the ability to expand production, they would have already. In the past, domestic production has risen in response to higher oil prices. In recent years, however, rig count has not increase as much as one would expect given the rise in oil prices. We believe the low rig count reflects a decrease in the number of economically feasible drilling locations. We would note that producers are generally able to produce oil at a cost of $30-$40/bbl. well below oil prices. If producers had the ability to ramp up drilling, we would have thought they would have done so even at $60/bbl. prices.
Horizontal drilling and fracking have increased production decline curves putting companies on a treadmill just to maintain production. More than half of domestic production comes from wells drilled in the last 24 months. The implication is that domestic oil producers are hard pressed to drill enough wells to offset production declines, let alone increase overall production to counter production declines by OPEC. As a result, we believe oil prices could remain high for many years.
Small producers and companies with a large drilling portfolio are best positioned. Larger producers continue to be constrained from expanding oil operations given political and shareholder pressures to move away from carbon-based energy. Smaller producers face less pressure. Companies with ample acreage and drilling prospects are best positioned to take advantage of a prolonged oil price upcycle.
Look for an increased focus on returning capital to shareholders. After several years of high energy prices, many companies have paid down debt and invested in infrastructure. With drilling prospects limited, we believe management will increasing look to raise dividends or repurchase shares.
Energy Stocks
Energy stocks, as measured by the XLE Energy Index, declined 5.3% in the 2023 first quarter. The decline was a sharp contrast to the 7.0% increase in the S&P 500 Index. The decline comes after several years of strong performances for energy stocks and reflects a 5.7% decrease in oil prices and a 50.5% decrease in natural gas prices. Worthy of note, as we are writing this report on April 3rd, oil prices have risen 6.3% and the XLE Energy Index is up 4.5% in response to an announcement by OPEC+ to reduce production by more than 1 million barrels per day. Following the announcement, oil prices settled above $80/bbl. almost reaching the price at the end of 2022.
Figure #1
If the cuts are adhered to, it will represent a significant increase in the excess production capacity of OPEC+. The surplus has grown steadily since the pandemic surpassing 5 million bbls./day according to the U.S. Energy Information Administration. That surplus had begun to decrease as the pandemic eased and global oil demand returned to normal levels. A reduction in production levels would return surplus capacity to pandemic levels.
Figure #2
With OPEC+ reducing production and oil prices rising, it will be interesting to see if producers in North America will respond by increasing production. In the past, when oil prices rose sharply, producers responded by drilling more wells. The advent of horizontal drilling and fracking over the last 15 years has greatly improved the economics of drilling in the basin by increasing the initial flow rates of oil and gas wells. As the chart below indicates, almost all wells drilled in North America are horizontal wells.
Figure #3
Unfortunately, one of the impacts of increased oil and gas flow is that production will decline at a higher rate after the initial production. That means more and more wells need to be drilled just to offset the drop in production. The chart below, while somewhat dated, shows Permian Basin oil production separated by the year wells came on-line. The chart shows that in 2022, more than half of all oil production came from wells drilled in 2021 or 2022. The implication is that domestic oil producers are hard pressed to drill enough wells to offset production declines, let alone increase overall production to counter production declines by OPEC+.
Figure #4
Source: Novi Labs
Without a rise in domestic production, it is likely that oil prices will remain at elevated levels. This is good news for producers who can produce oil at $30-$40 per barrel. The high netbacks (prices less royalties and operating costs) mean increased profits and cash flow for energy companies. And, if an energy company is fortunate enough to have a large acreage position with an abundance of potential drilling sites, growth rates will accelerate.
Natural Gas Prices
The outlook for natural gas, however, is not as rosy. Natural gas prices fell sharply this winter in response to warm weather and weak economic conditions.
Figure #5
Source: Natural Gas Intelligence
Storage levels, which were running below historical levels, are now at five-year highs for this time of year. With the winter heating season now coming to an end, storage levels are unlikely to reverse. As a result, natural gas prices could remain depressed until the fall heating season.
Figure #6
Outlook
A dismal quarter for the energy sector got a shot in the arm on the first day of the new quarter with a surprise OPEC+ production cut announcement. The announcement was welcomed news for producers that were already seeing profitable production margins and high returns on drilling investments. Cash flow levels are high and companies have been expanding operations and returning capital to shareholders. As investment opportunities become sparse and debt levels become low (or completely eliminated), we believe management will increase the focus on raising dividend levels and repurchasing shares. Share repurchases should support energy stock prices increases and an increased dividend yield should protect against any potential share price weakness.
We believe the case for smaller cap energy stocks is especially strong. Major oil companies are facing increasing pressure to focus on renewable energy instead of producing more carbon-based fuel. Smaller cap energy companies are less tethered and often able to acquire and exploit properties being ignored by the majors. If our belief that a world-wide recession is already factored into energy prices is correct, small cap energy companies will be in the best position to take advantage of any energy price increase resulting from OPEC+ production cuts.
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AMC and APE Now Have a Most Unusual Combined Stock Chart
AMC Entertainment (AMC – common) took a big hit on Tuesday (April 4), shaving over 20% off its per-share price. At the same time its preferred shares (APE) climbed over 10% as the so-called meme-stock movie-theater company announced it reached a settlement with shareholders over its planned stock conversion. The settlement with the group of mostly institutional shareholders allows management to complete its plan to convert its AMC preferred equity, or APE, units into shares of AMC common stock.
Where are the Arbitrageurs?
After the announcement that the case had been settled, AMC stock dropped, and simultaneously APE units rose to. Arbitrage opportunities may still exist for those that expect the price of the two share types to converge as the conversion moves even closer to reality with final approval still needed.
APE units began trading in August 2022 after management announced a unique dividend that paid each AMC shareholder one APE unit for every common share they owned. The APE shares eventually experienced the market pricing them at a steep discount to the AMC common shares.
The Complaint
At issue in the litigation was the claim that shares would be diluted without offsetting compensation to existing shareholders. It was initiated by a group of mostly large shareholders (think pension funds). The terms of the settlement, announced in a filing by AMC late Monday, will allow common stockholders to receive one share for every 7.5 shares held after the reverse stock split. The payment would represent around 4.4% of AMC’s stock, or 6.9 million shares.
“The settlement provides investors with additional shares in satisfaction of their voting claims, while allowing the company to move forward with its plan to pay down its debt,” plaintiff lawyers from Bernstein Litowitz Berger & Grossmann, Grant & Eisenhofer, Fields Kupka & Shukurov, and Saxena White said in a joint statement.
Management’s Goal
As of the end of 2022, the company owed $4.9 billion in debt. The settlement may allow the company to raise in excess of this amount which could go a long way in helping management reach its goal of ridding itself of debt.
A Word on Price Discrepancy
Arbitrage can occur when the price of preferred units is lower than the price of common shares, even though the ownership level is substantially similar, or if the dividend rate on the preferred units is higher. In these scenarios, an investor can buy the preferred units and sell the common shares short (i.e., borrow the shares and sell them with the hope of buying them back at a lower price in the future), thus profiting from the difference in prices.
As the price movement in the chart above shows, related arb. opportunity pre-announcement are likely to have paid well.
Arbitrage can also occur when the price of common shares is lower than the price of preferred units, even though the shares should trade in parity or the dividend rate on the preferred units is lower. In this scenario, an investor can buy the common shares, sell the preferred units short, and receive a higher return on investment by benefiting from the price difference.
There is not yet “final approval” on AMC’s next step. However, the shares and reverse split are shareholder approved and the settlement clears the way for the final board decision.
Are Safe Haven Investments Just Beginning Their Rise?
Gold is continuing to move up. Fueled by global tensions, rising prices, a weakening dollar, and new wariness of the banking system, gold seems to have regained its place as a safe haven portfolio allocation. Over the past five calendar days, the precious metal has gained $84 per ounce or 4.3%. In recent days price movement has been helped by lower yields on U.S. Treasuries and OPEC+ oil production cuts which can be expected to increase inflationary pressures as the cost of transportation and production rises for the majority of new goods.
Physical gold, priced in $USD, as seen on the chart below, is up 10.62% on the year. But that does little to tell the recent story. The investments in the yellow metal had gone negative on the year until two days before the Silicon Valley Bank’s problems became widely known in early March. This means much of the current increase on the year has occurred in under a month’s time. And the mindset that is driving the rise seems to be lingering.
Technicians point out that the $2020 level was an area of resistance that traders easily pushed through on Tuesday. Are there also fundamental reasons for it to continue its upward climb?
Global Tensions
Global tensions and geopolitical events can have a significant impact on the price of gold. Uncertainty surrounding the war in Europe, U.S. enemies forming closer alliances with each other, and a former U.S. President being indicted are providing heightened tensions. Gold has remained a safe-haven asset historically because investors turn to in times of political or economic uncertainty – it is perceived to be a store of value that is less vulnerable to fluctuations in currency values and stock markets.
We are in times of political and economic certainty now, this can continue to increase the demand for gold and drive up its price.
Inflation
Gold is often considered a hedge against inflation, so as inflation rises, the price of gold tends to increase. Recent reports in the U.S. have shown inflation, especially core inflation (net of food and energy price changes), has resumed an upward move. The spike in oil stemming from recently announced production cuts should increase both core and overall inflationary pressures.
When inflation is running high, the value of the U.S. dollar erodes. Investors gravitate to alternative stores of wealth that can maintain their purchasing power. Gold is seen as a safe-haven asset that can protect against inflation and currency devaluation. As a result, investors tend to buy more gold, driving up its price.
As mentioned above, a weakening U.S. dollar can have a significant impact on the price of gold expressed in U.S. dollars. Precious metals are typically priced in terms of U.S. dollars globally. When inflation runs higher than safe-haven U.S. Treasury yields than assets move toward alternatives like gold, real estate, or cryptocurrencies.
As a result, when the U.S. dollar weakens, the demand for gold may increase, driving up its price.
Systemic Risk
The risk of bank failures can impact gold prices in several ways. In times of perceived financial instability and/or economic uncertainty, investors’ confidence in banks and other financial institutions weakens. This often leads to a shift to safe-haven assets like gold.
In addition, if there is a continued risk of bank failures. If it happens, central banks could take steps to stabilize the financial system by injecting liquidity into the markets and lowering interest rates. These actions weaken currency which increases inflation. Inflation expectations, as mentioned earlier, support higher gold prices.
The chart shows the correlation between gold, and mining stocks since the beginning of the year. As a reference, the performance of the VanEck gold mining ETF (GDX), and the junior gold mining ETF (GDXJ) are charted against the S&P 500 (SPY), and an S&P mining index (XME). The XME is designed to track changes across a broad market-cap spectrum of metals and mining segments in the U.S.
The mining stocks have been moving in the same direction and pivoting at the same time as gold (XAUUSD). The difference is the moves have been more pronounced (up and down) for the mining stocks.
Investors expecting gold to continue to increase and considering increasing their exposure to safe-haven precious metals, ought to do their due diligence and determine if gold mining stocks are a better fit for what they are trying to accomplish.
In his Metals & Mining First Quarter 2023 Review and Outlook (April 3, 2023) Mark Reichman, Senior Research Analyst, Natural Resources, at Noble Capital Markets provides various potential scenarios to his outlook for gold and other metals. The report (available at this link) is a good place to start to weigh this industry expert’s considerations with your own.
Garibaldi Resources Corp. is an active Canadian-based junior exploration company focused on creating shareholder value through discoveries and strategic development of its assets in some of the most prolific mining regions in British Columbia and Mexico.
Mark Reichman, Senior Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
A look back at 2022. The 2022 drill program at Garibaldi’s 100% owned E&L nickel-copper-cobalt massive sulphide project tested targets from the 2021 Geotech deep penetrating Z-Axis Tipper Electromagnetic (ZTEM) survey. Of four holes drilled, two were successful, including Hole EL-22-97b, a deep hole which intersected two intervals of E&L gabbro more than 200 meters down plunge from previous drilling and intersected nickel-bearing disseminated and semi-massive sulphide mineralization. Hole EL-22-97b targeted the down plunge extension of the eastern zone of the E&L intrusion, coincident with a large-scale low resistivity/elevated conductivity ZTEM anomaly identified in 2021. The two successful drill holes are lined with polyvinyl chloride (PVC) and Garibaldi intends to conduct a geophysical borehole electromagnetic (BHEM) survey to refine holes to be drilled in 2023.
Upcoming drill program. Drilling in 2023 will test for mineralization associated with broad ZTEM low-resistivity anomalies identified by the property wide Geotech ZTEM survey. The 2023 drill program will likely commence in June and entail three to four holes at the E&L target, two holes of approximately 500 meters depth at the B1 target, and two holes at the Palm Springs property. Drilling at E&L will focus on areas within the ZTEM anomaly tested in 2022.
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