Some companies do very little but get a lot of credit. Conversely, some companies do a lot and receive very little. Alkame Holdings, Inc. (OTC Pink: ALKM) is the latter. And at $0.0037 a share, this emerging, diversified company may be the bargain of the year. It should be.
In fact, ALKM could be a case-study in valuation disconnect. Despite its unusually low share price, ALKM is executing a multi-faceted, diversified strategy to build shareholder value by maximizing its inherent strengths. ALKM has real products, multiple subsidiaries, transparent plans, and a history of achievement that may be unmatched by stocks trading at ten times its current value. And because ALKM can’t purchase the pricey paid-for attention from high-powered investment bankers to present its case, their lack of coverage on CNBC keeps them under the radar.
But that’s not always a bad thing. In fact, it keeps stocks like Alkame Holdings, Inc. under the radar long enough for retail investors to get first dibs on its low price. Sure, emerging companies have growing pains, and there are bumps and bruises to its share price on the ascent. But buying low and selling high is still the name of the game in investing. ALKM is offering that chance.
The exciting part of ALKM is that they are building value through a diversified plan of action. They offer health and wellness products, have an aquaculture water treatment division, offer CBD co-packing services, and plans to enter the billion-dollar pet health and wellness sector. While those divisions are likely worth far more than its current value, add value from its business interests in the hemp and gourmet foods markets, and the current share price becomes even more unbecoming. In fact, its market cap of roughly $20 million can be considered insulting.
But, as is often the case on Wall Street, good companies ultimately get discovered. Of course, the retail investor doesn’t learn about them until the price is bid higher. Thus, check out the ALKM opportunity now. Here’s why:
Multiple Interests And Shots On Goal
Companies that diversify their interests also mitigate risk. ALKM is an excellent example of how it utilizes that strategy to create value and protect its long term viability. The great news is that each step is accretive to a common revenue-generating goal. Follow along.
Last week, ALKM announced receiving an initial purchase order for its premium gel-hand sanitizer. The product is a good one. In fact, Alkame’s brand of premium ice-blue gel hand sanitizer is 16.9oz large, proudly made in the USA in a (cGMP) FDA registered facility, and contains aloe, menthol, eucalyptus. It’s a product that is effective and gentle on the skin.
The initial order, placed through its Canadian PPE distributor, Thera Products, Inc., is expected to generate additional sales into a massive PPE market where demand is far outpacing supply. The deal was made through its wholly-owned subsidiary, West Coast Co-Packer, Inc., a specialty liquid and single-serve manufacturer, co-packer, private labeler, and contract packager. It’s a big deal that, because of COVID-19, can get much larger- quickly. There’s more.
Two weeks ago, ALKM announced a second deal for its West Coast Co-Packer, Inc. subsidiary. This one was two-fold. First, it put ALKM’s position as the bottler of Puration, Inc’.s (OTC Pink: PURA) EVERx CBD Sports Water in focus. Here, having insight into how one product is doing provides information for the other. Those that try to gauge iPhone sales do it all the time.
More specific to ALKM’s case, investors learned last week that PURA expects 2020 sales to once again eclipse the $2 million mark. As the bottler, ALKM benefits from that growth. Thus, when EVERx does well, so does ALKM. That’s a given. More value is coming through PURA in another way.
Last December, ALKM announced that Puration purchased a 5% stake in the company. Assuming that part of that transaction was share-based compensation, the 600% increase in PURA shares immediately benefit ALKM’s balance sheet. But even if the deal was cash-based, it’s still good for ALKM. Both versions add value.
Also, having PURA close will help fuel the growing partnership and bring the companies closer together to initiate a pilot production of multiple new CBD infused consumer products. An update in February by ALKM noted that the two plan to produce and test market a CBD infused liquid sugar and a CBD pet food supplement. Other CBD-infused products, as well as hemp-derived beverages and edibles, are also in development.
But, if the Biden administration steps up, even those potentially lucrative markets could look small.
Capitalizing On A Less Intense Biden Administration
All eyes of those in the cannabis and CBD sector are on President Biden. Most are hoping that he will ease several of the federal regulations that have put a stranglehold on some sectors of the cannabis and hemp markets.
For ALKM and its partners, hemp is the focus. Remember, hemp is not a drug. It’s an environmentally sustainable plant that is an alternative to more than $1 trillion in industrial products and services that currently damage the environment. A change could be coming.
Speculation is that Biden will focus heavily on environmental issues, and hemp would fit nicely into the equation. For ALKM, its value could soar by leveraging its sizable role in PURA’s plans to develop a 70-acre parcel of land in Farmersville, Texas. It’s a planned campus where PURA intends to capitalize on multiple initiatives that can benefit ALKM in the near and long term.
Keep in mind that PURA’s hemp brand strategy is a cornerstone of the facility’s construction plans. Thus, the expertise in packaging and logistics could be a tremendous opportunity for ALKM to leverage its partnership to create and benefit from new joint-venture opportunities. It’s services are also absolutely necessary to PURA’s long-term strategies. Award some value there.
Even more opportunity comes from PAO Holdings Group, Inc.
PAOG And USMJ Connections
Another potentially lucrative deal could come through ALKM’s association with PAO Group, Inc. (OTC Pink: PAOG) in a co-development and distribution deal for PAOG’s nutraceutical product line. For its part, PAOG is on the move as well, and its growth can contribute to ALKM’s mission to create shareholder value by maximizing its subsidiary assets. Thus far, the great news is that ALKM’s deals are almost entirely accretive to earnings since little to no capital outlay is required to advance or partner on outside initiatives. That measure shouldn’t change.
And, with PAOG gearing up for its own rapid expansion in the nutraceutical space and having already secured a $300,000 sales agreement, cozying up to ALKM to secure its logistics requirements would be a smart idea. Moreover, PAOG is developing additional programs that would require packaging and distribution services as well. Therefore, creative value-generating opportunities could occur, especially if both companies continue to leverage each others operating strength to find accretive synergies to maximize bottom-line growth.
Finally, ALKM is exploiting a niche opportunity to capitalize on opportunities by working with North American Cannabis Holdings, Inc. (OTC Pink: USMJ). USMJ is generating interest from investors for its own plan to revitalize its investments in the cannabis and CBD space. Their growth could also benefit ALKM directly.
Also interesting is that North American cannabis is already working with Puration and PAO Group on separate projects. ALKM could fit into that threesome by becoming the exclusive provider of packaging and logistics services. Also, ALKM can offer additional expertise through its wellness, hemp, and aquaculture subsidiaries.
Thus, while the market-makers may be ignoring the tremendous opportunities in play for ALKM, it isn’t necessarily a bad thing for investors looking for undervalued companies in billion-dollar global markets. In fact, it can be a gift that keeps on giving.
Bottom Line Expectation
Is ALKM going to skyrocket to a dollar next week? Probably not. But, for value-minded investors seeking opportunities in undervalued, under-appreciated companies, Alkame Holdings may serve them well. With more than ten subsidiaries and a willingness to invest in new ventures and opportunities, ALKM may present a case study in how an early-stage development company matures into a leading player in multiple sectors.
Every company starts as an idea. Some are scripted on the back of a napkin and never make it out of the ballroom. Others, though, take time to develop. And when they mature, they can be a global provider of goods and services to multiple market segments.
Alkame Holdings may very well be one of the winners. And for the investors who find ALKM to be a compelling investment opportunity today, there’s always the chance that they will be the same ones speaking of how an investment in this micro-priced diversified company provided a life-changing windfall.
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