Food on the Move: FFFâ€™s weekly roundup of listed FoodTechâ€™s movers & shakers
Rewind to last week and a desperate Food on the Move resorted to putting a jinx on FFF’s listed FoodTech space. Why? To put an end to the seemingly endless streak of down weeks – more share price fallers than risers. As detailed in “Jinxing the listed FoodTech space”, the jinx went as follows: “Surely, FFF’s listed FoodTech space can’t make it eight down weeks in a row? That would be just remarkable. Couldn’t possibly happen? Could it?” So, one week on, and with the numbers in, the results verified, the question is…did the jinx work?
In all, the week ended 09 June 2023 saw 30 share price risers, 17 fallers and one non-mover among FFF’s listed FoodTechies. Losing run ended with room to spare. Jinxes do (apparently) work. Remember that for next time listed FoodTech gets stuck in a rut. If there is a next time…
At the individual stock level Blue Apron (APRN) caught the eye. Friday 02 June, the share price closed at a measly looking $0.53. Yet by Friday 09 June, shares in the meal kit co. were exchanging hands for $8.95 a pop. No misplaced decimal point, just a 1 for 12 reverse stock split that became effective after market close on 7 June 2023. May not have been a 17-fold increase in the share price, but there is a still impressive 40% gain to report. The stock split? If only it was that simple. More likely, the gain was down to APRN’s press release of 9 June: “Blue Apron Announces Closing of Transaction with FreshRealm to Execute Its Asset-Light Model and Focus on Its Direct-to-Consumer Business”.
As part of the deal, “Blue Apron transferred its operational infrastructure to FreshRealm, including fulfillment centers, equipment, know-how and related personnel. Blue Apron received approximately $25 million of upfront cash, subject to certain adjustments, and is eligible to receive up to $25 million of value upon the achievement of certain milestones…”
As for where that leaves the business, “Blue Apron is now an asset-light company, focused on the growth of its direct-to-consumer business…With a portion of the proceeds of the transaction, Blue Apron also completed the repayment of all its outstanding senior secured notes. With this payment, Blue Apron eliminated its debt.” Asset-light, debt-free, stock price above the US$1 threshold - things could be looking up for the slimmed-down Blue Apron.
APRN’s stock split is the second Food on the Move has reported on in the space of two weeks after Calyxt undertook a 1 for 5 split of its own. No 40% share price rise here, although the company, which has now changed its name to Cibus (CBUS) following its recent merger with the gene-editing agTech of the same name, did put out a press release: “Cibus’ White Mold Resistance Trait in Canola Achieves Another Important Milestone”.
According to CBUS co-founder Greg Gocal, “Our exciting new results signal that additional edits can lead to increased levels of Sclerotinia resistance in canola...Importantly, these new results give us a strong early indication that developing durable resistance using gene editing is commercially relevant and possible.” Perhaps a tad too early for the market to get too excited – shares finished the week marginally lower down 0.2%.
Beyond Meat (BYND) fared better – shares tacked on 13.45% to $12.06. No press release from the former FoodTech poster child but Bloomberg did put out a piece on the meat substitute co.: “Beyond Meat Is Set Up for Short Squeeze After Stock Surges 20%”.
As the title suggests, Bloomberg believes there could be more gains to come: “Beyond Meat Inc.’s 20% jump Thursday stung traders betting against the fake-meat company and set them up for a short squeeze that could lead to even steeper losses.” That’s because, according to S3 Partners LLC, there are a lot of short sellers out there and not much stock left to borrow and sell short: “In the last 30 days, 7.5 million Beyond Meat shares were sold short, pushing total short interest to $366 million, or 49% of float, according to S3. Currently, there are only about 200,000 shares left for short sellers to borrow and bet against, and fees to use that stock could jump to more than 100% of the stock price from the 75% to 95% rate that shorts are currently paying.”
Bloomberg goes on to quote S3 Managing Director, Ihor Dusaniwsky: “There cannot be a huge rush of short selling in the stock and new stock borrows will be very expensive.” One to keep an eye on.
Finally, Oatly shares finished the week up 17% at $2.01. Only news out from “the world’s original and largest oatmilk company” was “…the nationwide launch of its newest product in the US: a delectable plant-based cream cheese. Available in two flavors, Plain and Chive & Onion, Oatly's latest food innovation cracks the deliciousness code by delivering all the savory, tangy goodness of a ‘traditional’ cream cheese without any dairy whatsoever.” Don’t know how the cheese tastes but it certainly does sounds tasty – hope that hasn’t just gone and jinxed it…