Equity Research Focusing on the Consumer Sector, Small Cap Consumer Research

Small Cap Consumer Research

Equity research on small cap consumer names.

Equity Research Focusing on the Consumer Sector

Small Cap Consumer Research, LLC is a leading company-sponsored equity research provider focusing on the consumer sector (apparel, brand licensing and specialty retailing segments).

Equity Bottom-Up

<ul><li>We are reiterating our Buy rating and $8 price target, but lowering our 2024 projections after urban-gro reported disappointing 4Q23 (December) results, as the company had three material commercial contracts shift from late 4Q into 2024, obscuring what would have been a strong end to the year.</li><li>While the contracts are expected to be materially completed in 2024, management has decided to be highly conservative in their guidance and rebuild credibility going forward.</li><li>Given the current valuation, we believe investors are discounting the urban-gro business model and the potential for the company to register positive EBITDA. While we understand investor skepticism, we believe CEO Brad Nattrass and his team have aggressively cut costs and positioned urban-gro to surprise low Street expectations.</li></ul>

We are reiterating our Buy rating and $8 price target, but lowering our 2024 projections after urban-gro reported disappointing 4Q23 (December) results, as the company had three material commercial contracts shift from late 4Q into 2024, obscuring what would have been a strong end to the year.While the contracts are expected to be materially completed in 2024, management has decided to be highly conservative in their guidance and rebuild credibility going forward.Given the current valuation, we believe investors are discounting the urban-gro business model and the potential for the company to register positive EBITDA. While we understand investor skepticism, we believe CEO Brad Nattrass and his team have aggressively cut costs and positioned urban-gro to surprise low Street expectations.

UGRO: 4Q Review: Stuff Happens; Reiterate Buy & PT after Tough 4Q

Urban-Gro

UGRO: 4Q Review: Stuff Happens; Reiterate Buy & PT after Tough 4Q