Is Empower Clinics back on a Powerful Mode ?
Who hasn’t hard heard about Empower Clinics (CBDT.CN), raise your hand! February 15th 2021 marked the Company’s climax, reaching a 5 year all time high (CAD$2.5) and it means that if you bought shares the prior year, and sold it at the right time, you would have enjoyed an astonishing 6,250% return. If you haven’t sold it yet, you would “only” enjoy a 1,000% return. But the stock had a feeling to miss the boat when it should have left the harbour to reach another dimension. Now, some great news seem to mean the stock is back on track. Could it reach new highs ?
The fame with the Covid Pandemic
Empower clinics operates through clinics in the US (Oregon, Arizona, Washington State), Canada and a telemedicine platform. They became well known and appreciated by investors when they started to launch an innovative COVID-19 testing ( KAI testings). And investors were right. Starting February 16th, 2021, Empower Clinics KAI Medical Laboratory Surpassed 1,000 COVID-19 tests in a day for the first time ever and KAI Laboratory was tripling in size in anticipation of test volumes by end of Q1. Then, the life had to go on, and so does industries. Large gathering had to be regularly tested according to governments. During April 14th, 2021, CBDT received order for up to 5,000 Covid-19 tests from two film & television productions in Excess Of $750,000. And then last but not the least, the aviation started to reopen. To go with it, Empower Clinics announced COVID-19 referral agreement with a major Canadian Airline which will be later to be revealed, Air Canada.
In the meantime, they also developed a new line of product, SOLLIEVO, based on CBD lotion, tinctures, spectrum oils, capsules, lozenges, patches, topical lotions, gel caps, e-drinks, hemp extract drops, and pet elixir hemp extract drops.
They got a total revenues of $2,036,700 for Q1 2021 compared to Q1 2020 revenues $789,135, representing a 258% year over year growth. Despite all the great news, some investors were still expecting more. We can also not that the hope of Covid being erased thanks to vaccines hit a lot of companies such as the ones based in the healthcare sector ( mostly tele-health companies).
Where are they now ?
Men lie, but numbers don’t lie. And the only thing we can say is their numbers fight back more than pretty well to all the “FUD” surrounding the stock. And now, the stocks tends to be more attractive again. For the last 5 days, the Share Price was up by 22%, buoyed by a strong earnings report.According to their report released on August 30th, 2021, Empower Clinics reported a 1,005% year-over-year revenue growth in Q2 2021. We also can highlight these numbers:
- Revenues for Q2 2021 and Q2 2020 were $861,826 and $85,775, respectively;
- Net loss for Q2 2021 and Q2 2020 were $412,209 and $501,419, respectively.
In the recent days, the Company also announced is a very good news to their investors. Empower Clinics and Pharmasave Enter Pilot Program to Supply Kai Testing to Independent Pharmacies. So what does it mean? No less than 800 pharmacies will distribute and resale the KAI covid-19 testing for a six-month pilot program. Then, Pharmasave will decide what they want for the final busniess with Empower.
More recently, CBDT launched a revenue generating program in Texas targeting 500 schools as a pilot project. The program in Texas represents $17.1B . Indeed they have been successfully registered with the U.S. Federal CARES Act Program. CARES stands for Coronavirus Aid, Relief, and Economic Security (CARES) Act (2020) which is a federal program aimed at providing direct economic assistance related to the COVID-19 pandemic for American workers, families, small businesses, and industries.
How do their Financials look like ?
We saw earlier Empower Clinics generate a lot of revenues with their KAI testing products. At June 30, 2021, the company’s total cash was $5,191,944. According to their last report, their total assets represent $10,771,582 and so does their liabilities for a $0.00 net loss per share. Talking about shares, the company has 338,131,186 outstanding shares and if they need to raise more money, they can raise some by converting their warrants, they have still 10,629,905 warrants left but 4,108 total have to be converted before September 13th and 20th to an exercise price of $0.16.
There are also 6,244,459 options shares which can be converted. On August 6, 2021, 125,000 options with an exercise price of $0.05 (C$0.06) were exercised for proceeds of $5,976 (C$7,500) resulting in the issuance of 120,000 common shares.
Besides, with the cash they generate, it is possible we won’t see major dilutions through a private placement.
The total number of outstanding shares could lower investors’s expectations as it is a little bit high but once again, we shouldn’t see any major dilutions. 7.27% is held by all insiders. This number is pretty low but it is common to see low numbers in this sector.
The sector is still pretty uncertain. Will Covid last forever ? Only the future will tell us. So far, the only solutions are the vaccination and Covid testings. Besides, Empower Clinics generates a lot of revenues, and have a lot of new partnerships. You could definitely have this stock for short-middle-even long term depending on how long we will have to live with the pandemic.
This article solely expresses the opinion of the writer which might be disagreeing with the other writers of Money,eh?
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