Stock’s Details

SPI Energy Co., Ltd.

SPI Inks Deal with Tongjia: SPI Energy Co., Ltd. (NASDAQ: SPI) is engaged in offering photovoltaic and electric vehicle solutions for residential, business, utility customers, government, and investors. On October 15, 2020, the company stated that EdisonFuture Inc., a wholly owned subsidiary of SPI inked a strategic deal with Shaanxi Tongjia Automobile Co., Ltd. ("Tongjia"), under which both the companies will together work to customize the layout, advancement, production, and sales of a fresh generation of smart electric pickup trucks and electric logistics vehicles.

SPI Receives Letter From Nasdaq: On October 8, 2020, SPI informed the market that Listing Qualifications Department of Nasdaq has given a letter to SPI on October 7, 2020, depicting that SPI's Market Value of Publicly Held Shares ("MVPHS") had been equal to or more than $15,000,000 for the ten successive trading days from September 23, 2020 to October 6, 2020. This was the minimum requirement by SPI to continue to trade on The Nasdaq Global Select Market.

SPI Enters into an Amendment Agreement: On October 8, 2020, the company stated that it has entered into an amendment agreement with respect to its convertible bond financing with Magical Glaze Limited. Asper the amended agreement, the repayment of US$6.6 million and US$ 13.4 million of the principal amount of US$20 million is now due by October 8, 2020 and March 31, 2021, respectively.

Sneak Peek at FY19’s Key Results: During the period, the company reported total revenues of $97.88 million, as compared to $125.6 million in FY18. Net loss during the period came in at $15.1 million, as compared to $123 million reported in FY18.

FY19 Revenue Details (Source: Company Reports)

Stock Recommendation: The company exited FY19 with cash balance of $2.8 million, with total debt amounting to $129.7 million. The company’s strategic investments in solar industries, is likely to enhance its long-term profitability. The stock of SPI is trading at an EV/Sales multiple of 2.9x as compared to the industry median (Energy) of 1.3x on TTM basis. In the last one month and six months, the stock has moved up by 671.05% and 1,059.2%, respectively. On a technical analysis front, the stock price of SPI has a support level of ~$7.50 and a resistance level of ~$9.52. Hence, considering the steep upside movement in the stock within the past few months and higher valuations on TTM basis, we suggest our investors to wait for a better entry level and recommend an ‘Expensive’ rating on the stock at the current market price of $8.79 per share, down 3.83% on 16th October 2020.

AgeX Therapeutics, Inc. 

AGE Expands Relationship with Lineage: AgeX Therapeutics, Inc. (NYSEAMERICAN: AGE) is engaged in the expansion and commercialization of novel therapeutics targeting human aging. On September 9, 2020, the company broadened its collaborative relationship with Lineage Cell Therapeutics, Inc. pertaining to ES Cell International Pte Ltd. (ESI) stem cell lines for therapeutic purposes. Neither party made nor received any cash disbursements in relation with this agreement. Lineage has purchased the exclusive rights for the usage of ESI cell lines in spinal cord injury and specific oncology symptoms. However, as per the collaboration and licensing model, AgeX ensures independence to License out ESI Cell Lines to third parties. 

2QFY2020 Financial Highlights: During the quarter, the company reported revenue of ~$414,000, as compared to ~$380,000 reported in the year-ago quarter. The increase in the top-line was on the back of higher subscription and advertising revenues from the GeneCards® online database. Net loss for the quarter stood at ~$2.7 million, as compared to a loss of $3.1 million reported in 2QFY19. Research and development expenses for the quarter came in at $1.4 million, down by $0.3 million from the year-ago period. The decrease was on the back of layoff of 11 R&D employees in May 2020 and lower shared services from Lineage. General and administrative expenses also decreased by $0.4 million YoY to $1.7 million, due to decrease in travel and related expenses and decrease in shared facilities and services fees from Lineage.

2QFY20 Quarter Update (Source: Company Reports)

Stock Recommendation: The company exited the quarter with a cash balance of ~$1.03 million, with debt amounting to ~$3.99 million. The company has made robust progress in terms of its collaboration and licensing model. The current ratio of the company stands at 0.41x in June’20, lower than the industry median of 8.06x. The stock of AGE is trading at an EV/Sales multiple of 39.6x as compared to the industry median (Biotechnology & Medical Research) of 18.5x on TTM basis. In the last one month and six months, the stock has moved up by 100% and 139.4%, respectively. On the technical analysis front, the stock price of AGE has a support level of ~$1.00 and a resistance level of ~$2.5. In view of the risks associated with the stock, steep upside movement within the past few months, and higher valuations on TTM basis, we suggest our investors to wait for a better entry level and recommend an ‘Expensive’ rating on the stock at the current market price of $1.9 per share, up 8.57% on 16th October 2020.

Cloudweb, Inc.

Sneak Peek at Quarterly’s Results for the Period Ended June 30, 2020: Cloudweb, Inc. (OTCMKTS: CLOW) is a technology-based company looking to develop internet cloud services for small and medium businesses. During the quarter, the company reported total operating expenses amounting to $11.6 million, up from $6,353 reported in the year-ago period. The increase can primarily be attributed to stock-based compensation expense recognised during the quarter. Net loss for the period came in at $11.6 million as compared to $15,004 reported in the year-ago period. Net cash used from operating activities came in at $18,568 for the six months ended June 30, 2020. Accumulated deficit at the end of the period stood at $105.4 million.

Key Highlights (Source: Company Reports)

Other Key Updates: The company is looking for new business opportunities, with renowned business entities for merger and acquisition. As the company does not have enough fund and source of revenue, which is required to acquire new business, the company has not yet begun negotiations or entered into any definitive agreements for potential acquisition.

Stock Recommendation: The stock of CLOW closed at $0.69 with a market capitalization of ~$43.57 million. The stock made a 52-week low and high of $0.51 and $22.5 and is currently trading at the lower band of the range. In the last one month, the stock went down by ~33.65% and by ~84.67% in the last three months period. Notably, in the last one year, the stock went down 95.4%. On the technical analysis front, the stock price of CLOW has an immediate support level of ~$0.3 and a resistance level of ~$1.2. Thus, considering past movement in the stock, nil revenue, and loss-making business, we advise investors to avoid the stock at the current market price of $0.69 per share, down by 10.39% on 16th October 2020.

Comparative Price Chart (Source: Refinitiv, Thomson Reuters)

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