Cannabis Stocks: 2014 Review And 2015 Outlook
Viridian Cannabis Index Gains 38.4% for 2014
Cannabis Stocks Will Attract More Institutional Funding in '15 and M&A Activity Will Rise
More Companies Will Fail as Shake Out Continues
More institutional capital will flow into public cannabis companies in 2015, reflecting the sector's growth prospects, but some individual companies will falter as investors and regulators demand performance. The backdrop and general momentum of the cannabis sector is positive as the reality of its national growth potential becomes more and more apparent, but the shake out of individual players that began last year will continue in 2015, as hype will not be enough to sustain companies in the eyes of investors, and may contribute to action by regulators. We will likely see a number of public cannabis companies fail this year. With increasing flows of ‘smart money' will come increasing demand for companies to demonstrate top-tier management and sustainable business models.
Ashok Kumar, CFA
March 15, 2016
Building out the payment network ecosystem
Nxt-ID, Inc. (NXTD) is focused on developing and marketing products, solutions, and services for organizations that have a need for the Company's core technologies in digital payment technologies, biometric secure access control; encryption; sensor technologies and miniaturization.
Building the ecosystem: On 2/19/16, NXT-ID announced the first purchase order for the new SmartCard being developed for WorldVentures vacation club Members. The purchase order is for up to $15 million and is subject to WorldVentures acceptance of the prototype card now being manufactured. The purchase order calls for equal monthly deliveries with a value of $2.5 million a month from July to December 2016.
Mobile Wallets Can Deliver Value To Marketers: By aggregating offerings, loyalty points, coupons, and product information from multiple brands on top of faster, more-convenient payments, mobile wallets like Wocket® enable marketers to extend the brand promise, improve conversion rates, and drive traffic and sales.
US mobile payments to reach $142 billion by 2019: Over the last five years, US consumers have adopted smartphones at a breakneck pace: smartphone penetration among the US population grew from just 19% in 2009 to over 70% in 2015. Forrester forecasts that US consumers ramp up their mobile spending from $52 billion in 2014 to $142 billion by the end of 2019.
Remote mobile payments is the mobile extension of eCommerce:This is a focus segment for NXTD. Payments can occur via a merchant's mobile website or app and the consumer may enter payment credentials, select a card already on file or choose an alternative payment method such as a digital wallet. As the first category of mobile payments to gain traction, it is the largest category and will continue to be so through 2019. Remote mobile payments will grow from $43 billion in 2014 to reach $91 billion by the end of 2019, a very healthy CAGR of 16%. Food services such as mobile food ordering and delivery and travel services such as air and hotel purchase will drive a significant portion of the growth. NXTD remains well positioned to monetize this opportunity.
Market and Regulatory changes: In October 2015, US adopted the EMV standard used in other countries to verify the identity of cardholders for card present transactions. At the same time, liability for card fraud will become the retailer's, rather than the card issuer's responsibility. NXTD has reengineered its product portfolio to be compliant with the EMV standard. This is likely to cause disruption in near-term sales. But we expect revenue growth to resume in the June quarter.
Our 12-month price target of $3 is based on a DCF analysis that assumes a 15% discount rate and a 3% terminal growth rate. In October 2015 Aegis Capital Corp. was the sole book-running manager for a common stock offering.
November 6, 2015
A value-add player in the mobile payment market
Nxt-ID, Inc. (Nxt-ID) is a biometrics and authentication company focused on the growing m-commerce market with an innovative MobileBio™ suite of biometric solutions that secure mobile platforms. The Company also serves the access control and law enforcement facial recognition markets. Mobile Payments: IDC predicts that mobile payments globally will account for US$1 trillion in 2017, up from the 2015 figure of just below US$500 billion. The majority of mobile payments today are related to mobile commerce transactions, with remote payments being the most widely used. Whereas mobile payments in North America and Europe are driven largely by systems that are linked to debit and credit cards, the limited state of card adoption in Asia/Pacific forces potential mobile payment behavior to shift to usage of bank account–linked mobile wallets. Positioned in growth markets: Nxt-ID is focused on products, solutions, and services that have a need for biometric secure access control. Nxt-ID has three distinct lines of business that they are currently pursuing: mobile commerce; law enforcement and biometric access control applications
Disclosure section may be found on pages 17 - 18 of this report: NXT-ID
SoundView Technology Group Issues NXT-ID (NXTD) Update; Scaling Up
SoundView Technology Group (Boston) – October 5, 2015: SoundView Technology Group (http://soundview.co) releases the following market and company update for NXT-ID, Inc. (NASDAQ:NXTD), a biometric authentication company focused on the growing mobile commerce market.
NXT-ID (NXTD $0.80)
Kris Tuttle – October 5, 2015
We've been holding regular monthly meetings with NXT-ID to more closely track their progress since things are moving much faster now that the Wocket is in production. Here are some recent highlights:
Production ramp: NXT-ID is currently shipping their Wocket in steadily increasing numbers. Revenues are growing rapidly on a sequential basis – from $100K in Q2 to $400K in Q3 with a solid Q4 expected. The company continues to track very closely to our IV model projections which suggest a stock price of $7.47. Our unit sales estimates for 2016 and beyond appear to be low but we will re-evaluate those numbers as we exit 2015.
See the Full Report: NXT-ID
SoundView Technology Group Issues NXT-ID (NXTD) Update; MAJOR PROGRESS NOW ON SALE
SoundView Technology Group (Boston) – August 11, 2015: SoundView Technology Group (http://soundview.co) releases the following market and company update for NXT-ID, Inc. (NASDAQ:NXTD).
Market & Company Update
This season is famously bad in terms of liquidity in the stock market and especially for smaller, already thinly-traded issues. Since successfully launching their secure digital Wocket and raising capital to fund marketing and production expansion for the upcoming holiday season shares of NXTD have been cut in half since our last published update in June.
Part of the reason for the recent decline appears to be a direct result of a “sell” rating put on the shares by Zacks. It's important to realize that the Zacks system is driven by a set of quantitative and backward-looking metrics. Their ratings are not based on what we would call traditional research into what future business trends will be. Methods like the one Zacks uses can be useful for well established companies like GE or Oracle but are worse than useless for emerging growth companies.
The situation is especially compelling given that NXT-ID remains precisely on the plan we dialed into to our estimates this year and next which feed directly into our Intrinsic Valuation (IV) value of $7.47/share. There are certainly some potential near-term events like distribution partnerships that we have not factored into our numbers as of yet.
What follows is a more detailed account of company progress in Q2, the plans and outlook for Q3 and Q4, the terms of the capital raise and adjustments to our IV model based on them.
Full Research Report and disclosure: NXT-ID
Vista Partners Initiates Coverage on NXT-ID, Inc. (NasdaqCM: NXTD); Price Target $7.50
SAN FRANCISCO, CA - May 29, 2015 (Investorideas.com Newswire) Vista Partners announced today that it has initiated coverage on Nxt-ID, Inc. NXT-ID, Inc. ( NASDAQ: NXTD; NXTDW ) ("the Company" or "NXT") based in Oxford, CT, with a twelve month price target of $7.50. Ross Silver, Principal Analyst at Vista Partners, stated, "NXT is an early stage technology company that is focused on products, solutions, and services that have a need for biometric secure access control. The company is focused on the growing m-commerce market, launching its innovative MobileBio® suite of biometric solutions that secure consumers' mobile platforms led by Wocket®; a next generation smart wallet designed to replace all the cards in your wallet, no smart phone required." Mr. Silver concludes, "Competitors in the digital wallet marketplace, many of which are holdings in the iShares U.S. Technology ETF (NYSE: IYW) include: Google (Google Wallet), Apple (Apple Pay), EBAY (Paypal) & LoopPay (acquired by Samsung in February 2015 for $250M+)."
To download a FREE copy of the Nxt-ID, Inc. research report, please visit http://www.vistapglobal.com and click the "download research" icon to gain access to the report.
NXT-ID (NXTD $2.42)
KRIS TUTTLE - MAY 19, 2015
Back in March we published an NXT-ID update note [PDF] on the first “early access” Wockets shipping which allowed the company to gather feedback from field use. I had good success with my own Wocket even though it was a pre-release version which had a handmade prototype card that was too thick for some types of usage. Sixty days later, NXT-ID is preparing to fulfill their existing pre-orders this month which will put several hundred units into the market. The plan for June is to ship a few thousand units to customers who have requested invitations to order a unit. By July, the company should reach their baseline production capability of 10,000 units/month, which will coincide with initiatives in marketing and sales as well as some new distribution partners who will help with market penetration and fulfilment.
What follows are some new usage notes for the commercial version and a restatement of our assumptions behind our model that supports an NXTD intrinsic value of $8/share for 2015 and path to $17 in 2016.
Full report: NXT-ID update, May 2015
Technology Research Note Update from SoundView; Real-World Usage and Feedback of Wocket Smart Wallet at CVS, Whole Foods and other Retailers
BOSTON, MA - March 23, 2015 (Investorideas.com Newswire) SoundView Technology Group issues a new research update following the recent shipment of NXT-ID's ( NASDAQ: NXTD; NXTDW ) Wocket smart wallet. SoundView was one of the selected user groups to provide real- world user feedback on their experience with the Wocket in multiple scenarios and outlets.
Soundview shares their experience at CVS, Whole Foods and other retailers, making both debit and credit card payments.
Soundview analyst Kris Tuttle also says, "If the company meets their plans in 2015, it would push our IV estimate up to $17.42 for 2016."
NXT-ID, Inc. (NXTD) is a biometric authentication company focused on the growing mobile commerce market.
Excerpt: The Wocket Arrives
NXT-ID (NXTD $3.87)
THE WOCKET ARRIVES
KRIS TUTTLE - MARCH 23, 2015
After months of hard work and anticipation the Wocket has shipped. This event addresses the first chorus of skeptics who have insisted that "the Wocket will never ship." Even within the limits of an "early access device" our initial testing has gone very well in outlets ranging from CVS to Whole Foods to Panera using Visa (in both debit and credit mode) as well as American Express cards.
So the most interesting real-world interaction occurred in a CVS where the "hand card to cashier" message popped up. I had prefaced my swipe with the comment that I was using "a new ultra secure credit card" and when I handed over she responded "oh is this one of those cards where you can store all your cards on?" To which I replied yes indeed and she simply said "cool" and handed it back.
Even after a few days of use I was comfortable with the Wocket to head out for an evening without my wallet - just a few dollars in cash and my license. Having misplaced my wallet a week or two ago I can also say that the anxiety level from misplacing your Wocket is much, much lower. I wouldn't want to lose my Wocket but would feel none of that fear and panic that comes from losing my wallet with "everything in there." In fact by having all the plastic cards safely at home I wouldn't actually lose anything or need to change out all my cards to new account numbers. Getting a new Wocket and reloading the cards would be minor job but far less than cancelling accounts, refuting fraudulent charges and having new cards issued.
Anecdotes are not rigorous market research but the awareness level of the technology was a surprise and comfort level with the thing itself was reassuring. NXT-ID is using the input from early access users while preparing for their first production run to begin to fill pre-orders beginning in late April. The next production milestone is to deliver between 5,000 and 10,000 units in June.
The progress over the last two months certainly makes us feel comfortable with our 40,000 unit estimate for 2015 in terms of production capability.
So after suffering from a prolonged "wait and see" attitude the stock has moved up sharply recently in response to the initial shipments. Our own experience with the device so far would reinforce the view that 2015 will be a good year for the Wocket and NXTD shareholders.
The two major risks remaining are 1) the ability to ramp up production to thousands of units at first and then tens of thousands per month and 2) mainstream consumer reactions and adoption.
Our IV of $8.18 makes the shares very attractive, albeit with some expectation of success built into the estimate. If the company meets their plans in 2015, it would push our IV estimate up to $17.42 for 2016.
Our full update is available for download here:
Wocket is a smart wallet designed to protect your identity and replace all the cards in your wallet, with no smart phone or cloud required. Wocket works anywhere credit cards are accepted and only works with your biometric stamp of approval.
All your credit, debit, loyalty, gift, ID, membership, insurance, tickets, medical information, passwords, and virtually any other card can be protected on Wocket.
About SoundView Technology Group
We are an independent advisory and research firm specializing in emerging technologies as they reach commercialization. Our proprietary research and modeling work provides valuable information for company management teams and investors in these emerging opportunities. We regularly publish our findings across a variety of channels including all the major retail and institutional information outlets. SoundView is based in Boston, Massachusetts with locations in New York and Connecticut.
SoundView analysts do not receive compensation for their research opinions, any specific views or conclusions. They are tasked to provide fact-based research with sound analysis. SoundView does not provide investment advice or make "buy/sell/hold" recommendations. Nor do we provide investment banking or brokerage services. We act as a publisher of our own research work and are responsible for all content which is correct to the best of our abilities but by no means should it be relied upon without further validation and confirmation. SoundView provides paid advisory services NXT-ID on their business plans, technology description and investor positioning
Any questions please contact:
Director of Research
SoundView Technology Group
NXT-ID INC. (OTCQB:NXTD)
MOBILE SECURITY BEYOND THE PASSWORD
Stephen Waite And Kris Tuttle - October 15, 2013
There is a paradigm shift underway in the digital economy - one that has the potential to fundamentally change the way consumers, businesses and government agencies use and interact with technology. At the heart of the paradigm shift is a transition in payments processes and security technology away from conventional forms toward more advanced hardware and software.
Device-level sensors, biometrics and embedded processing have arrived.
The shifting digital economy landscape opens up new opportunities for entrepreneurs and investors alike. NXT-ID is an emerging technology company that is building an innovative, next generation platform using advanced biometric technology to enable secure transactions, identity management, and access control in an intuitive, cost-effective and easy-to-use manner. Our initial IV case suggests a stock value of $10.90/share if the company can execute on their plans.
Updates from Soundview
NXT-ID is offering pre-orders for the Wocket smart wallet (www.wocketwallet.com) at $149 and the first shipments to customers are planned for late September. After a review we are keeping our 2014 forecast of 40,000 units and will be evaluating consumer response in order to validate our longer term projects.
We're also introducing a longer term intrinsic value (IV) estimate of $20.55 for 2015. With a current IV estimate of $11.70 we think growth investors will find the risk/reward of this situation to be attractive.
GENSPERA CORPORATION (GNSZ- OTC QB Exchange)
Based on the company's attractive growth prospects with a pipeline of products based upon its unique platform targeting large tumor applications; and strong development and experienced management team who have taken drugs successfully through clinical trials, we recommend the purchase of GNSZ stock for speculative accounts seeking long-term capital appreciation. Our target: More than a double within the next 12-24 months.
Equity Research July 2014; Kareg Corp. Independent Investment Rese
Energy Tech Investor: ECOSPHERE TECHNOLOGIES (OTCBB:ESPH) - OVERVIEW REPORT
Ecosphere Technologies, Inc. (OTCBB:ESPH) is a U.S. technology licensing and innovative manufacturing company that develops environmental solutions for global markets. ESPH has a portfolio of more than 35 patented and patent-pending technologies: Technologies like Ozonix® and Ecos PowerCube®, which are licensable across a wide range of industries and applications throughout the world.
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