Neighbourly Pharmacy Inc T.NBLY

RBC

[retiredcf]

Here's a more balanced approach (and a buying opportunity). GLTA

January 24, 2023

Neighbourly Pharmacy Inc.
Head Pharmacist is leaving, but Rx should remain the same

TSX: NBLY | CAD 23.98 | Outperform | Price Target CAD 37.00

Sentiment: Negative

News: This morning, NBLY announced an unexpected CEO change, with Chris Gardner stepping away from the CEO role to be replaced by Skip Bourdo, an extremely experienced retail executive both operationally and in M&A, but new to Canada and NBLY. Mr. Bourdo had a successful 27-year career at Walgreen (NYSE: WAG), and more recently, was CEO of Athletico, where he oversaw rapid growth in the Company's footprint. Mr. Gardner will stay on as Strategic Advisor for a period of at least one year, providing valuable expertise as the Company moves through execution of its growth strategy.

Bottom line: The Street is never happy to see an unexpected CEO departure from a relatively recent IPO, particularly when it comes only 5 months after the announcement of a CFO succession. Importantly, however, we do not believe Mr. Gardner stepping away from the CEO role for personal reasons reflects any underlying untoward issues for investors. Moreover, Mr. Bourdo's deep experience, operational focus, and M&A experience, combined with the deep bench strength at NBLY should enable the Company to shore up its operational expertise while executing on its M&A growth strategy.

High conviction on M&A, key driver of growth and operating leverage. The fundamental growth opportunity at NBLY remains unchanged: with an addressable pipeline of 3.5k potential acquisition targets, and an uptick in succession planning conversations as pandemic and now triple virus surge fatigue increases, we are highly confident in NBLY ability to continue with the average pace of 40 stores/year, with upside should larger networks come to market. For the rest of F23, NBLY is on track to close roughly 10 acquisitions in addition to +4 in Q1 and +100 from Rubicon early Q2. Our forecasts indicate NBLY should be able to comfortably fund its growth from internally generated cashflow, resulting in modest deleveraging, while simultaneously delivering on operating leverage.

“Show-me” valuation presents opportunity for LT investors. With the stock down ~40% from its highs, NBLY is trading close to IPO valuation (12.3x C23E EBITDA). Strong argument for multiple expansion, in our view, underpinned by highly favourable M&A backdrop, demographic trends, ongoing expansion of pharmacy services, and the positive effect of scaling and valuation arbitrage on shareholder returns.

[RusticHit]

Looks like Good buy here thx for info Dcf

[RusticHit]

these are shorts driving down the price with 100 shares With brokers 1 and 79 as there is no support from company or insiders or other funds may go to lows at this rate

[RusticHit]

Down 5 bucks in 5 days crazy crash

[Evenkeel123]

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[RusticHit]

Loblaws can Grab them with1.5 B Bid if the want too 

[RusticHit]

50% shares are held by these guys  PCP now beneficially owns or has control or direction over, directly or indirectly, 22,420,922 common shares of the Company, increasing its equity interest in Neighbourly to 50.6%.

[RusticHit]

and they are poorer by whooping 110 Millions in 5 days whats going on with stock price is mind boggling  !!!!!!!!! 

[zforzebra]

These kind of stock moves are too exciting for me.  I thought this is a stock not crypto.

[RusticHit]

Non stop selling could Out going ceo selling out his shares ,,what ever it is but  stock is smoked badly and not big buyers stepping in Fishy fishy 

[Evenkeel123]

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[zforzebra]

If he left by choice, it is troubling.  The scenario is he was forced out which is possible given stock performance.

[RusticHit]

here she goes down again from morning open  selelrs are not going yet even after taking this 20 % ++ down on Ceo change confusing and Dazzeling

[Evenkeel123]

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[theanalyst11]

someone is buying lots of big block trade

[RusticHit]

lol how much you wanna buy like 50 K or more buy man if you go tthe money this is cheap now this one insiders are holding more than 50 % shares worth half billion 

[Evenkeel123]

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[theanalyst11]

ok sell your 500 share and move on man.

[Evenkeel123]

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[RusticHit]

Lol thats Big Patience if You did ,nt buy yet after this much drop but i think you are taking big beating on Tou what happened there ??? if i am in your position i will sell that and load this Up NO Nat Gas risk

[Evenkeel123]

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[RusticHit]

Right Good for You as for this turd todays is 3 rd day of drop look like bottoming out here volume is low today once sellers are out or Big guns want this go higher this could move quickly i am surprised to see PcP guys did,nt step Up to support the price around 22-23 bucks as the are losing bigly on every Dime drop

[Evenkeel123]

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[RusticHit]

Shorts and sellers are welcoming New Ceo with Nasty Sell off and no statement from Ceo or Company to calm down Holders that shows how The company is being Run not good at all i don,t know how these Pcp guys are still holding this looks like they are Under water big time now

[incomedreamer11]

Whatch out ,if support 19 CAD will be broken   next level -  IPO price 17 CAD Put stink bid around 17 CAD

[zforzebra]

Hmm.. this is not information because it doesn't answer why they are not good investments.  Obviously, pharmacies can be poorly run.  It's not obvious just yet that NBLY is particular poorly run. Pharmacies are good investments?  Remember Shoppers Drug Mart?  It was acquired by Loblaws.  Loblaws is any outstanding investment that I am unfortunately not a part of.

[RusticHit]

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[RusticHit]

down 6.50 bucks in a week or so and touching new lows look like a scam uncovered by shorts and sellers ????

[RusticHit]

big block swap of 85000  at 19.12  looks like bottomed in hopefully what a nasty sell off

[Evenkeel123]

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[theanalyst11]

no theres not. Its a liquidity issue. NBLY is a small cap stock and liquidity has been the worst in decade for small cap stock.Especially in canada. I was buying heavily in the low 19s . this stock is severely undervalued.