Normal service resumed

By Frank Buhagiar on Monday 19 June 2023

Normal service resumed
Image source: Normal service resumed
CommentaryFoodTech Investment

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

Well, that didn’t last long. It was only a week ago that Food on the Move was reporting how share price risers in FFF’s listed FoodTech space had outnumbered share price fallers for the first time since April and, in the process, had ended a seven-week losing run. Seven days later? Normal service resumed.  To be fair, it was close – 23 fallers compared to 21 risers (there were four non-movers) but close can’t prevent another win chalked up by the fallers. Let’s just hope this is not the start of another losing streak for the risers…

At the individual stock level, last week’s Food on the Move highlighted Bloomberg article “Beyond Meat Is Set Up for Short Squeeze After Stock Surges 20%”.  One to keep an eye on - Food on the Move suggested.  One week on and shares in the alt-meat producer tacked on another 6.63% to close at US$12.86. Compare that to the US$10.6 level the shares were exchanging hands for at the beginning of June.  More of a long and gentle share price climb than a short squeeze.  Reckon management won’t care as long as that share price keeps moving up.

Elsewhere, another week another reverse stock split to report.  In last week’s Food on the Move, it was Blue Apron. The one before Cibus (CBUS). This time round it was Local Bounti’s turn to slash the share count. A 1 for 13 swap before market opening on 15 June 2023 did the job.  Market didn’t seem too impressed – shares in the US indoor agco closed down 7.53% at US$4.53.  Still a way to go, for now at least, before the dreaded US$1 level looms into view and with it the possible need for…another reverse stock split.

More daylight between CBUS’ current share price (US$16.93) and the all-important US$1 mark.  But there won’t be if the shares make a habit of shedding 30% as they did over the course of the week ended 16 June 2023.  Two releases put out by the agtech - “Cibus Applauds the Genetic Technology (Precision Breeding) Act 2023 Passed in the United Kingdom” and “Cibus to Participate in Upcoming Investor Conferences”.  Not much there to warrant such a steep fall in the share price.  The company will be hoping the fall does not herald a resumption in what was a long and painful share price decline before the merger with Calyxt.

And what’s this? The share price of Blue Apron, another very recent reverse stock-splitter, fell by a remarkably similar amount to CBUS.  Shares in the meal kit co. were down 33% to US$6 a pop. And that’s not where the similarities end.  As with CBUS, Blue Apron issued a press release during the week.  As with CBUS, Blue Apron’s announcement, “Blue Apron Introduces Two Easy Summer Meal Kits with Brand-New”, doesn’t offer much of a clue as to why the shares fell so heavily.  Post-reverse stock splititis at work?  That’s when the excitement, if it can be called that, of the reverse subsides. The initial uplift in the share price has taken place. And the company’s underlying issues once more come to the fore.  The result? The market starts to fret that, in terms of share price performance, it will be a case of normal service resumed…