Ho, ho dear…

By Frank Buhagiar on Monday 12 December 2022

Ho, ho dear…
Image source: Ho, ho dear…

Food on the Move: FFF’s weekly roundup of listed FoodTech’s movers & shakers

Little festive cheer around FFF’s listed FoodTech space during the week ended 09 December 2022. Almost three times as many share price fallers as risers – 36 fallers/13 risers to be precise. Not quite in Santa Claus rally territory, typically the last five trading days in December and the first two in the New Year, but that might just be the sector’s best shot to finish the year on a high.     

As for the ‘lucky 13’ risers, top billing goes to Missfresh (NAS: MF) – shares in the Chinese fresh-food retailer leapt 47.5% to close at US$2.33.  A bit of a puzzle this one as during the week, MF put out a press release announcing that it had been notified by Nasdaq “…that it no longer satisfied the $10 million stockholders' equity requirement for continued listing on The Nasdaq Global Market…”  The release goes on to say the company has been granted a 45-day reprieve “…to submit a plan to regain compliance with that requirement or one of the alternative listing standards.”

The press release does add that “The Company believes it can satisfy an alternative requirement to the Stockholders' Equity Rule; namely, the $50 million in total assets and $50 million in total revenue requirement…Accordingly, the Company intends to submit…a plan to regain compliance with the Total Assets and Total Revenue Rule or the Stockholders' Equity Rule.”  Encouraging perhaps, but not worthy of a near-50% gain, surely?  Something else afoot or just another small illiquid share being moved by the slightest whiff of buying activity?

Possibly a bit of both. For the BBC reported this week that China was lifting “…its most severe Covid policies…The sweeping changes indicate China is finally moving away from its zero-Covid policy and looking to ‘live with the virus’ like the rest of the world.” Was this enough to account for the jump in MF’s share price? If it was then maybe the relaxation of the zero-COVID policy will make it easier to put together a plan for the good folk at Nasdaq...

Interestingly, it was only last week that Food on the Move’s Tis the Season highlighted a Motley Fool article that suggested “…some tempering of anti-COVID restrictions in a carrot-and-stick approach” may be behind the rise in the share price of  Dada Nexus (DADA) as this could be “a sign that China's government may be relaxing its zero-COVID policies…and that's likely to be good for business if the government keeps moving in this direction.” One week on and with the relaxation now confirmed were DADA’s shares able to maintain their momentum or as the old saying goes was it “better to travel than to arrive”? Another 7.5% share price gain for ‘China’s leading local on-demand delivery and retail platform’ says it all.  The theory’s got legs!

Elsewhere, Goodfood Market (FOOD) was in demand once again.   Shares in the meal-kit delivery co. tacked on another 21% - still basking in the previous week’s strong Q4 and full year earnings release it seems.  All good stuff there then.

Not so at Steakholder Foods (STKH) – shares halved to close the week below one dollar at US$0.956.  Only press release put out by the cultured meat co. was “Steakholder Foods® Develops Temperature-Controlled Print Bed System for Its Industrial-Scale 3D Bio-Printer”.  The news got CEO Arik Kaufman excited, “We are proud to have reached this important milestone with our technology. It is a critical step toward producing structured cultivated meat at scale…” Investors clearly weren’t too impressed but it’s worth looking at the timing of both the share price drop and the announcement.  Most of the damage was done to the share price on 6 and 7 December while STKH’s press release was put out on 9 December.  Hmmm, a case of getting any old piece of news out to try to stem a share price decline?

Finally, Kalera (KAL) gave up last week’s gains and a little bit more – shares closed down 37% to finish at US$0.088.  The clue is in the sub-US$1 share price and the vertical farmer’s announcement of 6 December: “Kalera Encourages Shareholders to Vote in Upcoming Extraordinary General Meeting”. The EGM has been called “to seek shareholder approval of a reverse stock split.” Chairman Curtis McWilliams meanwhile explained why shareholders are being ‘encouraged’ to vote: “It is important that all Kalera shareholders vote their proxy, regardless of the number of shares they own. A vote FOR the reverse stock split would help ensure Kalera remains a Nasdaq-listed company.”

Seems a week does not go by without talk of a reverse stock split, the battle scars of a tough year for listed FoodTech.  So, how many days to go before that Santa Claus rally?