Ride this bus to $3 in the next few monthsBefore I start my thesis, I want to show you guys my track record on investing in Canadian penny stocks.
https://stockhouse.com/companies/bullboard?symbol=c.phgi&postid=30544957
I called RHT from 30 cent to $1.8 (6 baggers for me in 2017)and DOC (previous ticker was PHGI) from 0.46 to $2. (almost 5 baggers for me in 2020) These 2 penny stocks have produced massive life changing gains for me and I think BUS can be my next big winner.
Here's my thesis:
Playing penny stocks is different from buying large cap blue chips on Nasdaq. As i always emphasized, buying penny stock, you need to buy the great story. Story! Story! And Story!
IMO, BUS is presenting a great story to the institutional audience and the big pocket speculative money here:
1. This is a unique vincinity bus play in north america with a specific market niche and captured 90% of the core market share in Canada. Lots of potential catalysts in the pipeline, WIth their current position and the potential of electricity vincinity bus, this play has the potential to form a unique MOAT and I won't rule out the possibility of big partnership deal with big vehicle manufacturer in the near future.
2. strong revenue growth in the past pre-covid era and super undervalued. With a market cap of 98.6M, this could easily be the EV play with the lowest market cap on the planet. Price-to-sale ratio is only around 5 whereas if you look at the EV plays on the US side, usually P/S ratio is around 10 to 15 in this sector. As BUS transitions into an EV vincinity bus play, valuation of this company is no longer the same as in the past. This is also why my price target is around $3 CAD per share.
3.With only 76M shares out, this has the right float size and it has been proved in the past that, it can have explosive move when there is a huge interest from speculative money.
4. huge insider loading activity is a vote of confidence.
5. Strong and even stronger demand for EV public transport will only grow higher in the foreseeable future. This trend will stay.
6. I believe you and I can agree that Trudeau's Liberal government will only promote higher use of renewable energy in the foreseeable future. I won't be surprised that BUS will get more and more contracts and funding support from municipal and provincial governments.
My final price target: $3 CAD (Ideal target if the company can continue to execute)