RE:RE:RE:RE:RE:RE:Aveeno FormulationI was referring to spec premium for potential new revenue streams. I don't think there is any for recovery of existing revenue streams. Yes management says they expect improvement in AV sales in 2019, but we've been down this road before. Look what actually happened in 2018 (28% YTD sales decrease in Q3 revenues in 2018 to 2017) compared to management expectations for 2018 at the end of 2017 (2017 Q3 MD&A):
"Looking forward, we expect our base business in cosmeceuticals to be very solid
over the next twelve months due to a continued increase of sales of avenanthramides, increased sales of beta glucan to new customers as well as sales of cosmeceuticals directly to high end value customers."
So we're left with the existing business which is not profitable (and not expected to be profitable at least any time soon). Yet the company is still trading significantly above book value. This premium is for potential new revenue streams.
Ciao wrote: billy4325 wrote: If investors thought there was a very high probability of it going to zero, it wouldn't be trading above book value. Again, there is most definately a premium already priced in for potential new revenue streams. The company isn't trading above book value just for their unprofitable existing (and rapidly declining) revenue streams.
I think this is a good discussion for all of us here,
When CZO reported Q2 earnings, the stock took a tumble to the low 30's from a support level of about 50 (I think a lot of us here would believe that investors reacted looking forward as well that there would be no recovery to revenues anytime soon, personally I think Q4 will be a dud as well, it's not a concern for me). So the share price is still below 50 (one spike to 45 on BG pill NR) and is sitting under 40 today. If there is a premium somewhere for potential new rev streams then it should be trading above 50 or even above 65 where it previously established a 50/65 trading range.
IMHO, There is little if any speculative premium on recovering revenues or even any PGX, or IBG funtional food or drink licensing or agreements.
The company noted in the Q3 results that AV sales would improve in 2019. BG appears to be doing OK, but their contribution to overall rev is relatively small in comparison. So if there is ANY speculative premium for recovering revenues, where is it?