Neptune Wellness Solutions Inc (NEPT) said on Monday that it had entered into a definitive agreement with International Flavors & Fragrances Inc (IFF) in relation with co-development of hemp-derived CBD products for the mass retail and health & wellness markets.
Shares of Neptune Wellness Solutions Inc closed lower for the fifth time in the past ten trading sessions on NASDAQ on Monday. The stock went down 16.67% ($0.59) to $2.95, after touching an intraday low at $2.94, or a price level not seen since March 25th ($2.83).
Shares of Neptune Wellness Solutions Inc have risen 16.14% so far this year, following a 7.63% gain in 2018.
In Toronto, the marijuana stock went down 17.37% (CAD 0.82) on Monday to close at CAD 3.90.
“The agreement represents a significant event in the development of our global cannabis business, expanding our business model from primarily B2B to include a robust B2C business platform. IFF has an impressive track record, remarkable capabilities and global reach,” Michael Cammarata, Neptune’s Chief Executive Officer, said in a statement.
“This partnership will accelerate Neptune’s vision and growth strategy to be the leading producer of hemp extracts ingredients and finished products for the global health & wellness and Consumer Packaged Goods industries. We are also now better positioned to leverage our management’s experience building brands and relationships with key North American retailers,” Cammarata added.
The first products are to be launched under Neptune’s Forest Remedies brand at retailers across the United States during the first half of next year. Neptune said that the initial launch would encompass a range of topical products across the aromatherapy category.
As part of the co-development partnership, Neptune is to issue 2,000,000 warrants to IFF. Each warrant will allow the beneficiary to purchase one common share of Neptune at an exercise price of $12.00 per share with a five-year expiration date.
Analyst stock price forecast and recommendation
According to CNN Money, the 2 analysts, offering 12-month forecasts regarding Neptune Wellness Solutions Inc’s stock price, have a median target of $7.57, with a high estimate of $7.57 and a low estimate of $7.57. The median estimate represents a 156.56% upside compared to the closing price of $2.95 on November 11th.
The same media also reported that all 2 surveyed investment analysts had rated Neptune Wellness Solutions Inc’s stock as “Buy”.
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