New Year, new beginnings?

By Frank Buhagiar on Tuesday 10 January 2023

New Year, new beginnings?
Image source: New Year, new beginnings?
CommentaryFoodTech Investment

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

A good start to the year for FFF’s listed-FoodTech space - just what the doctor ordered after the travails of 2022.  The number of share price risers outnumbered fallers by a ratio of more than two to one during the week ended 6 January 2023. In all, there were 31 risers, 15 fallers and three non-movers.   

Stand-out performer was Boxed (BOXD) – shares doubled to US$0.391 after the online retailer “launched a process to explore strategic alternatives, including, among other alternatives, a possible sale of the Company. In addition, the Company is, in parallel, actively exploring capital raising initiatives, and is targeting the announcement of additional funding within the next 45 days.” Now, a doubling in the share price is not to be sniffed at, but FFF estimates the shares will need to double another four or so times to match the US$400 million offer from grocer Kroger that BOXD turned down back in 2018.

Any other week and chances are Dada Nexus’ (DADA) 71% share price gain would have topped the riser list.  Shares in the Chinese on-demand delivery/retail platform have been flying high ever since the country relaxed its zero-COVID policy. Sentiment towards Chinese stocks in general appears to have got another boost during the week thanks to talk that Chinese regulators have approved a capital raise for Ant Group, the fintech founded by Jack Ma. Guess one could say that it was a good week for Ma(ma) and Dada

Elsewhere, AppHarvest (APPH) added to the strong gains that were triggered by the recent completion of a US$127 million sale-leaseback deal for its Berea indoor leafy greens farm – shares in the vertical farmer tacked on another 48% to US$0.844, almost double the US$0.46 level they were trading at as recently as mid-December.

Good week too for Oatly – shares increased 45% to finish the week at US$2.54 after the oat drink co. unveiled a US$98.1 million production deal with Ya Ya Foods. The agreement is in line with Oatly’s ‘asset-light’ model and will see Ya Ya Foods take control of two of Oatly’s US-based production facilities and at the same time purchase some technical equipment. CEO Toni Petersson said: “We believe an increased focus on our oat base technology, innovation, branding and commercial execution will better position Oatly to drive profitable growth, while reducing the capital intensity of our future facilities, and ultimately convert more consumers to plant-based and create more products that are healthy for people and the planet.” Thanks, Mr Petersson, all nOated.

As for the fallers, an 18% share price decline sees Hydrofarm (HYFM) pick up the wooden spoon.  Only news out from the hydroponics equipment provider was a press release announcing its participation in “a fireside chat discussion at the 25th Annual ICR Conference in Orlando, Florida...on Tuesday, January 10, 2023.”  Oh, and Wells Fargo did cut its price target for the stock by a quarter to US$1.5 from US$2 – a more likely explanation for the share price fall, surely? Otherwise, attending that ICR Conference would have cost HYFM around US$12m when taking into account the drop in the co.’s market value…