December 9th, 2021 | 13:24 CET
Tilray, Sativa Wellness, NanoRepro, Valneva - The 2022 health winners
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Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
Tilray - A EUR 4 billion market awaits opening
Tilray is currently the German market leader in the sale of medical cannabis extracts. One may assume that the Company will also dominate the region's adult-use recreational cannabis market. The traffic light coalition recently announced its plans to legalize the recreational use of cannabis for adults.
In response, investors pounced on the few German publicly traded cannabis companies, causing their valuations to rise between 60% and 100%. However, in addition to SynBiotic and Cannovum, two somewhat narrower values, investors should also focus on the major stocks in the industry, such as Tilray and Aurora, as they are leaders in the German medical cannabis market. Aurora is number one in dried cannabis sales, while Tilray leads the cannabis extract market. Overall, it looks like investors have not yet fully priced in the enormous market opportunity. Within 3 to 5 years, a new billion-dollar market should emerge here.
The legal side seems promising because the key point is that Germany has a lot of weight within the European legislation in Brussels - some believe in faster legalization procedures if Germany steps on the gas with a new government. Shares of Tilray now have just a 24% gain on the clock in 2021, compared to over 500% in between. Overall, cannabis stocks could shine again from a regulatory perspective in 2022.
Sativa Wellness Group and NanoRepro - High demand for COVID testing
Sativa Wellness Group is a UK-based provider of various cannabis-related services. From self-therapy to wellness, they focus on cannabidiol (CBD), laboratory services, and other wellness products derived from the hemp plant. Like other players in the market, Sativa Wellness naturally hopes for the complete legalization of the products and is already ensuring a suitable positioning.
Currently, the strategic positioning is already well underway. The established trading company, Goodbody Botanicals, has made profits throughout 2021 to date after losses in previous years. There is more good news about the current number of bookings in the affiliated wellness clinics. Record sales were achieved in the fall, bringing revenue to more than GBP 13.8 million after 11 months.
The Goodbody network now includes more than 140 clinics, including establishments supported by Superdrug. Goodbody clinics offer COVID blood tests on a large scale, and the uncertainty surrounding Omicron is playing into the Company's hands. That is because all travelers must now undergo PCR testing two days after returning to the United Kingdom, which can be booked at Sativa's affiliated clinics.
Marburg, Germany-based NanoRepro AG also reported that the rapid antigen tests it sells can reliably detect SARS-CoV-2 infection, even with the new Omicron virus variant. NanoRepro's rapid tests provide a necessary tool for the free testing centers, which are bustling because of 3G and 2G+ regulations in the workplace and public transportation. Sales could explode to EUR 250-400 million in 2021.
Both Sativa Wellness and NanoRepro are in a class position in the current pandemic environment. While NanoRepro is still struggling to overcome the EUR 10 mark on the chart, Sativa Wellness has several ideas for the cannabis market opening in 2022, in addition to its test offerings. With EUR 16.4 million market cap, Sativa is also much cheaper.
Valneva - When is the inactivated vaccine coming to Europe?
The Valneva share is currently riding a roller coaster of the highest order. A month ago, the share price was below EUR 20, then it shot up to EUR 30.50 and is now back in the region of EUR 23. Where does the volatility come from? First, there was the rumor that the Valneva vaccine would not help against the Omicron variant, but then the announcement that the EMA wants to review the vaccine in a fast-track procedure spurred on, and now some calm has returned.
Meanwhile, the inactivated vaccine developer has inked a new pre-contract for its VLA2001 corona vaccine. Bahrain is the first country outside Europe to express interest in the Company's alternative vaccine. The Middle Eastern kingdom plans to purchase one million doses of VLA2001. Valneva has reportedly initiated a rolling approval process with the Bahraini National Health Authority (NHRA).
If company officials are to be believed, shipments are already on track for the first quarter of 2022. Additional supply agreements with larger countries could bring music back into the title. Likewise, a result of the EMA approval can penetrate the market at any time, but the price could react erratically in both directions. For those with the nerve for a favorable scenario, a few Valneva plays will bring good diversification to the speculative COVID long portfolio. After all, the topic will remain for several years to come.
The cannabis sector and pandemic-related stocks will be good choices again in 2022, as there are prospects for growth and some surprise potential. If the pandemic lasts longer than expected, there will also be months of testing ahead. Sativa Wellness Group offers solutions in both areas. Much remains speculation, of course - but that is what makes the stock market exciting.
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