ONE OVERLOOKED STOCK TO WATCH IN 2018 (THAT ISN’
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As 2018 gets started, most traders continue to fixate on cryptocurrency and cannabis. While there is buzz abound across these two hot industries, many regulation uncertainties and valuation concerns plague these markets.
Cryptocurrencies are surging on an almost daily basis and a state of “mania” has certainly set in across the investment community. However, most global regulators are skeptical of the movement and fear its potential to create financial unrest. In some cases, regulators have chosen to shut down cryptocurrency exchanges and restrict trading of the assets because their understanding cannot keep up with surging digital movement.
Cannabis continues to be a major topic across North America. California is the latest state to officially legalize recreational cannabis in 2018, but Attorney General Jeff Sessions has nullified the Cole Memo protections against enforcing federal marijuana laws. This has caused some headaches and panic across the U.S. cannabis industry, as they prepare for a potential federal crackdown.
These hot sectors have been rewarding to investors, but are becoming increasingly crowded trades. All of this attention has caused investors to largely lose sight of opportunities across other industries. As the year goes on and these trades become increasingly crowded, funds will flow to new areas of the market. One stocks to keep an eye on in 2018 (that is not a crypto or cannabis play) is Innovest Global, Inc. (OTC Pink: IVST).
Overview: Innovest Global, Inc. (OTC Pink: IVST)
Innovest Global, Inc. (OTC Pink: IVST) is engaged as a diversified holding company that seeks to acquire, integrate, and grow companies that have novel technologies and/or are in high-growth markets. Management ultimately seeks to create a holding company that can generate strong revenue growth, while capturing benefits of long-term economic trends.
Innovest Global, Inc. IVST Logo
Innovest Global, Inc. IVST Logo
Currently, Innovest Global, Inc. (OTC Pink: IVST) has three holdings:
Chagrin Safety Supply: a revenue-producing, business-to-business safety durable goods and equipment distributor with a 35-year history of success.
Sanavida: a telehealth company that provides on-demand healthcare services for a low-cost monthly subscription (no health insurance required). The platform is available in English and Spanish.
Shepherd Energy Solutions: a commercial energy company that offers services to improve electrical efficiency, management, and cost reduction.
Innovest Global, Inc. (OTC Pink: IVST) has previously disclosed that it is in talks to acquire an auto retailer group out in the Midwest, which has annual revenue greater than $150 million. Management has also received a commitment letter to fund 100% of the potential acquisition. Currently, the deal remains in the due diligence stage, as management weighs the pros and cons of entering the auto retail market.
IVST: Subsidiaries Provide Access To High-Growth Markets
Innovest Global, Inc.’s (OTC Pink: IVST) Sanavida and Shepherd Energy Solutions subsidiaries are providing the company access into two major high-growth markets: telehealth and energy efficiency. Chagrin Safety Supply operates in a stable growth industry and provides Innovest Global, Inc. (OTC Pink: IVST) with a stable revenue source.
Sanavida IVST Telehealth Logo
Sanavida IVST Telehealth Logo
Telehealth is the fastest growing sub-segment of the healthcare industry. According to market research firm, Frost & Sullivan, the telehealth industry is estimated to see a compound annual growth rate (CAGR) of 29.30% between 2016 and 2021. Furthermore, the market research firm sees telehealth going mainstream within the next five to seven years.
Management also sees Sanavida as a potential solution to the current U.S. healthcare environment, which is threatened by astronomical insurance premium increases, national overhaul, and decreasing coverage. The Sanavida platform is capable of providing face-to-face online visits, 24/7 medical assistance, discounted medical visits, prescriptions, medical supplies, and mental health services all at a low-cost subscription. Innovest Global, Inc. (OTC Pink: IVST) is currently utilizing test marketing on Sanavida and will likely have more information shortly.
Energy management and efficiency solutions continue to see strong outlook, as commercial, industrial, and government entities look to upgrade their energy systems to focus on conservation and cost savings. According to the 2017 Power and Utilities Trend report by PwC, analysts see most of the changes and growth coming from a “blueprint for a service-based model.” This will include energy management, emerging technologies, monitoring equipment, and other technology to help meet the necessary energy demands. Management has identified Shepherd Energy Solutions as one such company that fits into this model and positioned to benefit.
Shepherd Energy Solutions could also be a beneficiary of the recent U.S. tax system overhaul. The recent tax overhaul seems to have some positive and negative connotations for energy efficiency providers. On one hand, the new tax system has cut tax credits for “combined heat and power, fuel cells, ground source heat pumps, and other technologies.”
Shepherd Energy Solutions Logo IVST
Shepherd Energy Solutions Logo IVST
However, the new tax bill does allow businesses to increase their cap on deductible business investments up to $1 million. Furthermore, the bill makes HVAC systems and roofs in commercial buildings as part of eligible expenses. Rather than recognizing depreciation over a number of years, the new system would allow the full cost of the investment to be deducted from taxable income in the first year. In other words, business owners can receive tax credits for business investments in the first year, rather than utilizing older depreciation recognition methods. This is a major opportunity for Shepherd Energy Solutions to potentially see faster growth, as businesses now have more incentive to take on enterprise upgrades.
IVST: Financials and Industry Analysis
Innovest Global, Inc. (OTC Pink: IVST) has a market cap of $1.25 million, as of January 2018. Furthermore, the company maintains a share structure consisting of 500 million authorized shares, 62.34 million shares outstanding, and a float of 11.8 million shares, as of November 2017. During the third quarter 2017, Innovest Global, Inc. (OTC Pink: IVST) reported total assets of $528,000, total liabilities of $344,000, no revenue and net loss of $1,000. Keep in mind that the company began generating revenue with the acquisition of Chagrin Safety Supply, which was announced in October 2017. These revenues will be reported on the fourth quarter 2017 and annual earnings releases due out shortly.
OTC Markets IVST Chart
OTC Markets IVST Chart
Overall, the company continues to fire on all cylinders as new subsidiaries continue to be added through strategic acquisitions. Innovest Global, Inc. (OTC Pink: IVST) has strategic holdings across the commercial safety, energy solutions, telehealth, and auto retail industries. Management has also stated that more acquisition could be on the way, as the company’s long-term plan involves meeting the necessary requirements to uplist to the AMEX, NASDAQ, or NYSE. Innovest Global, Inc. (OTC Pink: IVST) enters the year as an overlooked stock with major potential, as acquisitions continue to take shape. Here are five other companies that have operations similar to Innovest Global, Inc. (OTC Pink: IVST) and could help find a proper fair valuation for the company:
XsunX, Inc. (OTC Pink: XSNX) is engaged within the design, installation, and sale of solar power components and energy saving technologies. As of January 2018, XsunX, Inc. maintains a market cap of $1.90 million. Furthermore, the company has a share structure consisting of 2 billion shares authorized and 1.26 billion shares outstanding, as of December 2017. During the company’s latest reported fiscal quarter ending September 30, 2017, XsunX, Inc. reported total assets of $48,000, total liabilities of $1.09 million, total revenue of $81,000, and net loss of $336,000.
U.S. Lighting Group, Inc. (OTC Pink: USLG) operates as a manufacturing company that designs and develops proprietary LED lighting products for commercial and industrial markets. The company has a market cap of $10.98 million, as of January 2018. Furthermore, U.S. Lighting Group, Inc. has a share structure consisting of 100 million shares authorized and 36.99 million shares outstanding. During the third quarter 2017, U.S. Lighting Group, Inc. reported total assets of $4.8 million, total liabilities of $4.57 million, total revenue of $388,000, and net loss of $280,000.
Source: Official Innovest Global Twitter 1
Source: Official Innovest Global Twitter 1
Orion Energy Systems, Inc. (NASDAQ: OESX) is engaged within the research, design, manufacturing, marketing, installation, and sales of energy management systems for commercial clients. The company primarily specializes in energy saving solutions for offices, retailers, and industrial environments. As of January 2018, Orion Energy Systems, Inc. has a market cap of $25 million and maintains a share structure consisting of 28.91 million shares outstanding and a float of 25.22 million shares. During the third quarter 2017, the company reported total revenue of $15.42 million and a net loss of $3.67 million.
Asbury Automotive Group, Inc. (NYSE: ABG) is an auto retailer that operates across the United States. The company’s vast dealerships provide a full range of services such as: new and used cars, vehicle repair & maintenance, replacement parts, collision repair, financing, insurance, and more. As of the end of 2016, Asbury Automotive Group, Inc. held a portfolio of 93 new car franchises, which represented 28 major vehicle brands at 77 total dealership locations and 23 collision centers nationwide. As of January 2018, Asbury Automotive Group, Inc. has a market cap of $1.47 billion and maintains a share structure consisting of 20.82 million shares outstanding and a float of 18.55 million shares. During the third quarter 2017, Asbury Automotive Group, Inc. reported total revenue of $1.6 billion and net income of $30.7 million.
Teladoc, Inc. (NYSE: TDOC) is the largest telehealth platform operator in the United States. The company provides on-demand healthcare services that assist a wide range of ailments: behavioral health, infection treatment, dermatology, anxiety/depression, and smoking addiction. As of January 2018, Teladoc, Inc. has a market cap of $2.20 billion and maintains a share structure consisting of 61.15 million shares and a float of 49.35 million shares. During the third quarter 2017, Teladoc, Inc. reported total revenue of $68.65 million and net loss of $31.33 million.
Overall, Innovest Global, Inc. (OTC Pink: IVST) is well-positioned for major developments in 2018, as management continues to gain traction in key industries that are positioned for long term growth. The company’s fourth quarter and annual earnings reports for 2017 will show the beginning of major revenue growth potential. In addition, the recent tax system overhaul may help spark earnings growth at Shepherd Energy Solutions, as businesses can now claim their energy efficiency tax savings earlier than under the old code. Innovest Global, Inc.’s (OTC Pink: IVST) telehealth subsidiary, Sanavida, is uniquely positioned to benefit from multiple healthcare fronts: healthcare system overhaul, uninsured care, and as the fastest growing subsector. As Innovest Global, Inc. (OTC Pink: IVST) continues to position within strong-growth industries, the company’s outlook only looks brighter.
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