PharmaCielo is getting it done in cannabis extraction, says Stifel GMP

CantechLetter.com, Nick Waddell, 4 June 2020

It’s all systems go for PharmaCielo (TSXV:PCLO), says Stifel GMP analyst Robert Fagan, who delivered an update to clients on Tuesday, saying PharmaCielo’s steady cost reductions are a good sign of things to come. … PharmaCielo released its first quarter results on Monday for the period ended March 31, 2020, and featuring revenue of $514,000 compared to $787,000 for all of 2019. …

Fagan called the quarterly results largely in line with estimates and not entirely material at this early stage in the game for PCLO, with about 275 kg of CBD isolate sold over the quarter at about US$1.40 per gram. The adjusted EBITDA loss of $4.5 million ended up better than Fagan’s estimate at $5.8 million owing to the company’s better cost control at both production and SG&A. (All figures in Cdn dollars unless noted otherwise.) …

The analyst expects PCLO to generate fiscal 2020 revenue and EBITDA of $8.2 million and negative $11.2 million, respectively, and fiscal 2021 revenue and EBITDA of $93.2 million and $53.0 million, respectively. With the update, Fagan has reiterated his “Buy” rating and $4.00 target, which at press time represented a projected return of 376.2 per cent.

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