Private client call with Seabridge Gold (SA) Buy rated $30 PT

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Private client call with Seabridge Gold (SA) Buy rated $30 PT

Join us for a webinar on Apr 29, 2021 at 9:00 AM PDT.

 

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Join CEO Rudi Fronk for an important update on Seabridge Gold (SA) and state of the Gold market .

Seabridge Gold recently closed the acquisition of the Snowfield Property, a large gold resource immediately adjacent to Seabridge’s100%-owned KSM gold-copper project. The acquisition could have a significant positive impact on project economics at KSM. We maintain our BUY rating and price target of $30.00 in the short term based on bullion prices.

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Singular Research March 2021 Director's Letter

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Singular Research’s March 2021 Director’s Letter

 

In March, there was greater than expected fiscal stimulus and vaccine rollout progress. In the last week of the month, nearly 2.8 million doses were administered every day. The stimulus at the end of 2020 ($900 billion) and the relief package signed in early March ($1.4 trillion) make up nearly 14% of U.S. GDP. The American Jobs Plan, signed on the last day in March, proposes fiscal spending of $2.25 trillion aimed at improving America’s transportation, communication, and infrastructure. With this news combined, markets moved higher despite fears of inflation; value outperformed growth by 420 basis points. The recovery path ahead may be bumpy, but a greater-than-expected vaccine rollout and fiscal stimulus should further support equity markets.

The March Purchasing Managers Index® (PMI) registered 64.7 percent, an increase of 3.9 percentage points from the February reading of 60.8 percent. Similarly, the Conference Board Leading Economic Index® (LEI) increased 0.2 percent in February to 110.5 (2016 = 100), following a 0.5 percent increase in January and a 0.4 percent increase in December. Both the PMI and LEI increased which suggests investors and businesses are encouraged by vaccinations and reopening plans. The unemployment rate dropped to 6.0% in March (6.2% in February) as businesses have started the rehiring process.

singular monthly performance march 2021

For the month of March, the Singular coverage list continued to outperform the S&P 500 and Russell 2000 by 311 and 619 basis points, respectively. Over the last twelve months, the Singular coverage list outperformed the S&P 500 and Russell 2000 by 9,458 and 5,719 basis points, respectively. Since our 2004 inception, the Singular coverage list has outperformed the S&P 500 and Russell 2000 by an annualized 580 and 495 basis points, respectively.

top 5 worst performers march 2021

For March, VYGVF was our leader for the second consecutive month. VYGVF had a great month as their AUM and February preliminary revenue surpassed $1.7 billion and $20 million, respectively. ZEUS also had a stellar month as the firm is mainly expected to benefit from the American Jobs Plan and economic reopening. Similarly, EBIX rebounded from February lows as investors believed the stock may have been oversold. Investors cheered AMRK as they closed their recent acquisition of JM Bullion.

march 2021 top 5 worst performers

NAK was our worst performer for the month largely from investors’ disappointment that NAK’s request for appeal on their Pebble Project will take longer than expected. As growth-oriented stocks, ROKU, GDNP.V, QNST, and ZM were all hit hard in March from inflation and rising interest rate fears. In fact, ZM reported great earnings at the beginning of the month with fourth quarter revenue up 369% year-over-year.

For the month, we initiated coverage on RSI, BBKCF, and DMYD. RSI operates online gaming and sports betting in the U.S. under the Rivers, SugarHouse, and Rush Street brands. BBKCF owns and operates cryptocurrency related businesses. The firm owns two operating companies: Netcoins, a cryptocurrency brokerage, and Blockchain Intelligence Group, a suite of forensic and analytic solutions to mitigate risks associated with cryptocurrency transactions. DMYD (Genius Sports Group) is the official data, technology, and commercial partner that powers the global ecosystem connecting sports, betting, and media.

march 2021 new initiation

 

We wish to thank our clients for their support and belief in our process. To learn more about Singular Research and register for a 14-day trial offer, please follow the link below. 

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Robert Maltbie, CFA
Singular Research, President
818-222-6234(office)
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Private Client call & 1 on 1s with Adams Resources & Energy (AE) Wednesday, April 14 9am-12 PDT

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Private Client call & 1 on 1s with Adams Resources & Energy (AE) Wednesday, April 14 9am-12 PDT

 

Join us for a webinar on Apr 14, 2021 at 9:00 AM PDT.

 

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Please join us for a private client call and 1 on 1s with CEO Kevin Roycraft of Adams Resources & Energy, Inc. (AE) on Wednesday, April 14 at 9 am PDT. Individual 1 on 1s will take place from 10 am to 12 pm PDT.

Adams Resources & Energy, Inc. (AE) is primarily engaged in the business of crude oil marketing, transportation, and storage and tank truck transportation of liquid chemicals and dry bulk through its two wholly owned subsidiaries GulfMark Energy, Inc. and Service Transport Company.

Adams Resources & Energy Inc is a play on the improving outlook for crude oil prices as vaccine rollouts increase optimism on a global economic recovery. We believe both AE’s businesses, supported by two recent acquisitions, are well-positioned for growth heading into 2021. We are bullish on AE's growth prospects and our price target is $39.75.

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Vegas Ready To Recover From Pandemic: Now It's A Stock Picker's Game

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Vegas Ready To Recover From Pandemic: Now It's A Stock Picker's Game

Singular Research: Staff

 

Summary

  • Our gaming index imploded, but it then bounced back to the record-setting territory.
  • Pent-up demand from many Americans has caused the gaming industry to see an uptick in customer demand.
  • with 20 U.S. jurisdictions open to sports betting, aggressive marketing efforts are sure to continue converting customers to betting online.

 

vegas airport

(Airline traffic has steadily increased at McCarran International Airport in Las Vegas.)

 

It's only a five-mile stretch of Las Vegas Boulevard, but when the Strip shut down for the coronavirus pandemic in March 2020, it was as if the entire city had turned out the lights. The party's over.

Normally packed with tourists and traffic, Las Vegas' resort corridor - developed with $40 billion of casino infrastructure - looked more like the ghost towns that dot Nevada's historic mining landscape.

Our gaming index imploded, but it has since bounced back to record territory.

COVID-19 exacted a heavy toll on U.S. commercial gaming revenue, which plunged 31 percent in 2020, the first market contraction since 2014, according to the American Gaming Association.

The industry managed to survive by partially reopening casinos and getting a boost from legalized sports betting. Some gaming analysts are optimistic that the worm has turned.

Strip-exposed equities such as MGM Resorts (MGM) and Caesars Entertainment (CZR) have fully recovered and surpassed 52-week highs. MGM is up 18.9 percent from a year ago at $37.48 a share, and Caesars is more impressive, up 26.8 percent at $93.78, as of March 10.

Local favorites Boyd Gaming (BYD) and Red Rock Resorts (RRR) also have recovered, up 36 percent and 25.6 percent, respectively.

Las Vegas Sands (LVS) and Wynn Resorts (WYNN), which generate a considerable amount of revenue from Macau, have both undergone recent changes in leadership, and linger 30-40 percent below pre-pandemic highs.

Penn National (PENN), with its oversized investments in the spread of legalized sports gambling and iGaming, leads the pack, up nearly 200 percent from pre-pandemic highs.

 

Optimistic outlook

With the nationwide rollout of COVID-19 vaccinations and declining cases, deaths and hospitalization rates, the gaming industry is beginning to see an uptick in customer demand, the pent-up demand that many Americans have been waiting to unleash.

"The leisure customer will return to Las Vegas in a shorter time period than the business customer as we continue to emerge from the Great Shutdown," says Brendan Bussmann, government affairs director at Las Vegas-based Global Market Advisors.

"One of the keys to this, though, will be keeping good (airline) lift into the market because the leisure customer is still looking for deals and capacity is somewhat still constrained as airlines try to recoup losses."

Passenger traffic at McCarran International Airport, a key economic indicator for Las Vegas, dropped precipitously from 3.8 million in February 2020 to 152,470 in April 2020, then steadily climbed back to almost 2 million in October. January's count was 1.5 million.

Bill Miller, chief executive officer of AGA, feels upbeat about the second half of this year. "As vaccines roll out, people will be excited to travel, hungry for entertainment, and desperate to get out and have fun again. That's an environment where gaming will thrive."

Recovery of the gaming index confirms his view. Even as visitor growth flattened in Las Vegas before the pandemic, tourists were still interested in traveling to the city, though they may not have made the trip.

 

Betting app converts

While Las Vegas casinos took a major blow in 2020, online sports betting, Internet casino games and esports blossomed and show no signs of withering, even as casinos reopen around the country.

DraftKings (DKNG) and Fan Duel have flooded TV airwaves with app advertisements in states that legalized sports betting, and newcomers such as BetMGM, Skillz and Barstool are knocking on the door offering new products that enhance and advance the betting experience.

With some 20 U.S. jurisdictions open to sports betting, aggressive marketing efforts will continue to dominate the scene as operators compete for market share, Global Market's Bussmann said. Sports books across the country are converting customers to betting online.

"While these (apps) will win over the local market, there is still nothing that replaces the experience that Las Vegas offers during sporting events," he asserts. "The experience will never be lost even as sports betting spreads across the U.S."

Bally's Corp. (BALY) seeks a larger stake in the burgeoning esports segment, offering $100 million to acquire Allied Esports Entertainment, which follows last year's "skin" partnership with Esports Entertainment Group (GMBL).

Other than HyperX Esports Arena at Luxor hotel, esports has yet to gain traction in Las Vegas. Still, Bussmann sees the industry growing in terms of exposure, sponsorship, fan engagement and eventually wagering.

"While we have not seen as strong success as some would like in esports with casinos, we will eventually start to see a better blend as some of these esports are allowed to have wagers placed on them, depending on the jurisdiction," the gaming analyst said.

 

Stock Picking But With The Houses Edge

Esports has exploded in popularity over the past decade and is predicted to continue growing at an explosive growth partially from COVID-19 lockdown fears. Now here comes the houses edge, Esports Entertainment Group (GMBL) is the only eSports-focused wagering platform.

While Esports Entertainment Group has a huge focus on eSports, this isn't to say management is naïve. Management actually has a well thought-out business strategy to eventually branch into all areas of online gambling. From these factors and many others, we have a current price target of $20 a share.

 

If the houses edge wasn't good enough, what about being able to count cards?

Less metaphorically speaking here, another great beneficiary in the online gambling arena is Golden Nugget Online Gaming (GNOG). For starters, Golden Nugget Online Gaming is majority owned by Tilman Fertitta, one of the best jocks as a CEO one could ask for.

Not only does Golden Nugget Online Gaming benefit from having access to the Golden Nugget Casino database but also to the entire Landry's restaurant network. Over 600 restaurants around the United States will be miniature billboards for Golden Nugget Online Gaming.

One could argue these miniature billboards are not effective but simply put, Golden Nugget Online Gaming has almost 3x the average customer lifetime value as DraftKings. From these and other factors, we consider a fair value for Golden Nugget Online Gaming to be $24 a share.

 

202002 gaming index

Source: Singular Research Estimates

 

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Join Us for Private Client Call w/ BIGG Digital Assets (BBKCF) CEO Mark Binns on Mar 25, 2021

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Private Client Call with BIGG Digital Assets (BBKCF) CEO Mark Binns 9am-10 PST, Thursday March 25

 

Join us for a webinar on Mar 25, 2021 at 9:00 AM PDT.

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Please join us for a private client call with CEO Mark Binns of BIGG Digital Assets Inc. (BBKCF) on Thursday, March 25 at 9 am PST.

BIGG Digital Assets Inc. owns and operates cryptocurrency related businesses. It owns two operating companies: Netcoins, a cryptocurrency brokerage, and Blockchain Intelligence Group, a suite of forensic and analytic solutions to mitigate risks associated with cryptocurrency transactions.

BIGG operates an online cryptocurrency brokerage as well as cryptocurrency risk intelligence solutions. Both of its operating businesses have experienced significant increases in product demand over the past several months. As a result, BIGG has now achieved positive cash flow from its monthly operations. The cryptocurrency risk intelligence market is multi-billion dollar in size and has very few competitors. The barriers to entry are remarkably high. BIGG is well positioned to take a significant share of the market in coming years.

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Active Coverage Report Preview: VYGVF (03/10/2021)

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Active Coverage Report Preview: VYGVF (03/10/2021)

 

The company announced record Q2:21 revenue of $3.6 million. In February, the company experienced rapid growth surpassing $1.7 billion in AUM and $20 million in monthly revenues. We are bullish on VYGR’s long-term prospects. We maintain our BUY rating and increase our target price to $23.50 per share (earlier $13.00).

VYGVF report 03 2021

 

Q2:21 Highlights

  • Revenues increased 3,949% YOY to approximately $3.6 million for Q2:21 compared to $88,146 for Q2:20.
  • Assets under management (AUM) surpassed $230 million at the end of December 2020, up from $5 million at the end of December 2019, representing a 45x increase over that period.
  • Management noted that their preliminary revenue grew to ~$20 million as of February 2021.
  • Voyager's AUM continues to grow exponentially, as well as the growth of daily net deposits and new accounts on the platform. Given the dramatic increase in AUM as well as trading velocity, we increase our estimates.
  • We maintain our Buy rating and increase our target price to $23.50, implying a price appreciation potential of 56%.

 

PRIMARY RISKS

  • Voyager frequently has acquisitions. Failure to integrate any acquisition could result in additional risk and uncertainty for the business.
  • Crypto-related businesses face a very uncertain regulatory environment. There is high ambiguity and lack of clarity from many governments globally. Any unfavorable change could negatively impact operations.

 

buy active coverage report 2

Singular Research February 2021 Director's Letter

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Singular Research February 2021 Director's Letter

 

In February, Covid vaccinations started to roll out throughout the world with more than 239 million vaccinations administered globally. However, the story of month had more to do with inflationary fears and rising bond yields. With U.S. economies re-opening, talks of fiscal stimulus, and a pledge from Federal Reserve Chairman Powell to keep interest rates low to spur economic growth, investors have been moving more into equities and selling bonds. On Thursday, February 25, the yield on the 10-year Treasury hit 1.60% which was higher than the S&P 500 dividend yield, before settling at 1.42% the next day. As a result of rising yields, investors became more cautious of growth and technology stocks, looking favorably instead on energy and value stocks; WTI and Brent were up 17 and 20% for the month. The market path to life after the pandemic has been bumpy as investors look beyond a “stay at home” trade to a “re-opening” trade.

The February Purchasing Managers Index® (PMI) registered 60.8 percent, an increase of 2.1 percentage points from the January reading of 58.7 percent. Similarly, the Conference Board Leading Economic Index® (LEI) increased 0.5 percent in January to 110.3 (2016 = 100), following a 0.4 percent increase in December and a 0.9 percent increase in November. Both the PMI and LEI increased which suggests investors and businesses are encouraged by vaccinations and reopening plans. The unemployment rate was little changed at 6.2% in February (6.3% in November) as businesses have started the rehiring process.

 

Singular Directors Letter February 2021 img 1

 

For the month of February, the Singular coverage list continued to outperform the S&P 500 and Russell 2000 by 1,103 and 773 basis points, respectively. Over the last twelve months, the Singular coverage list outperformed the S&P 500 and Russell 2000 by 4,844 and 3,266 basis points, respectively. Since our 2004 inception, the Singular coverage list has outperformed the S&P 500 and Russell 2000 by an annualized 561 and 456 basis points, respectively.

 

Singular Directors Letter February 2021 img 2

 

 

For February, VYGVF had a great month as their AUM and trades surpassed $1.1 billion and one million, respectively. GMBL also had a stellar month as the firm reported strong Q2 results with the acquisitions of Lucky Dino, Helix eSports, and ggCircuit. Similarly, MGNI excited investors with their fourth quarter year-over-year revenue growth of 69%. NAK was a top performer for the month as investors anticipated positive news from their request for appeal of the Pebble Partnership.

 

Singular Directors Letter February 2021 img 3

 

EBIX was our worst performer for the month as their auditor, RSM U.S. LLP, resigned because of “unusual transactions” in their gift card business; however, since then EBIX has brought on a new Indian auditor to complete their 10K filing by the end of April. We view this selloff as a buying opportunity. BYND reported weaker than expected fourth quarter earnings as the company’s foodservice business is still negatively affected by the pandemic. Interestingly, the company signed deals with McDonald’s, Pepsico, and Yum! Brands which should bolster growth once the pandemic subsides. GNOG and IEC had strong months but were largely the victims of a broad market selloff. TA announced fourth quarter results that were weaker than expected.

For the month, we initiated coverage on AE and GNOG. AE is primarily engaged in the business of crude oil marketing, transportation, and storage and tank truck transportation of liquid chemicals and dry bulk through its two wholly owned subsidiaries GulfMark Energy, Inc. and Service Transport Company. GNOG operates online gaming and sports betting in the U.S. under the Golden Nugget brand. The company maintains an 8% market share in New Jersey’s iGaming industry, the most mature market in the U.S., and has also launched iGaming in Michigan, Pennsylvania, and West Virginia.

 

Singular Directors Letter February 2021 img 4 

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Singular Research's Emerging Growth & Value Alpha Leaders Webinar

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Singular Research's Emerging Growth & Value Alpha Leaders Webinar 2/25 6:00am - 4:00pm PST

Join us for a webinar on Feb 25, 2021 at 6:00 AM PST.

 

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Emerging Growth & Value Alpha Leaders Webinar

Thursday, February 25:
7:45:  Hut 8 Mining Corp. (HUTMF) Ms. Jaime Leverton CEO & Director
8:30:  Esports Entertainment Group, Inc. (GMBL) Mr. Grant R. Johnson CEO, Chairman, Pres, Sec. & Treasurer
9:15:  BIGG Digital Assets Inc. (BIGG.CN) Mr. Mark Binns CEO & Director
10:00: Voyager Digital Ltd. (VYGR.CN) Mr. Stephen Ehrlich Co-Founder, CEO & Director
10:45: Northern Dynasty Minerals Ltd. (NAK) Mr. Ronald William Thiessen Pres, CEO & Director
11:30: Acme United Corporation (ACU) Mr. Walter C. Johnsen Chairman & CEO
12:15: TBA

Prospective Presenting Companies Include:

Voyager Digital Ltd. (VYGVF)
Bigg Digital Assets Inc. (BBKCF)
Silvercrest Asset Management (SAMG)
Esports Entertainment Group Inc. (GMBL)
Kirkland's Inc. (KIRK)
Ebix Inc. (EBIX)
Northern Dynasty Minerals Ltd. (NAK)
A-Mark Precious Metals Inc. (AMRK)
IEC Electronics Corp. (IEC)
Acme United Corporation (ACU)
L.B. Foster Company (FSTR)
Olympic Steel Inc. (ZEUS)
IRadimed Corp. (IRMD)
Emergent Biosolutions (EBS)
Banco LatinoAmericano (BLX)

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