April 13, 2021 -- InvestorsHub NewsWire -- via MarketWatch
-- PAO Group, Inc. (USOTC: PAOG) stock
closed 21% higher Monday preceding its planned investor update
released this morning. In a pre-market release on Tuesday, PAOG
updated investors about its expanding CBD-based therapeutics and
nutraceuticals program that now includes two promising treatment
candidates. The first is RespRx, targeting COPD, and the second,
CBD RELAX-RX, a nutraceutical designed to treat anxiety and
depression. The market opportunity is substantial, with estimates
calling for at least a $25 billion combined market opportunity
within five years.
Investors stayed bullish after the release, sending shares
roughly 9% higher in early morning trade. Highlights from its
update discussed the potentially transformative acquisition of
RespRx from Kali-Extracts, Inc. (OTC Pink: KALY) in 2020. That
treatment is under development for Chronic Obstructive Pulmonary
Disorder (COPD) with CBD compounds derived from a patented cannabis
extraction method - U.S. Patent No. 9,199,960 entitled "METHOD AND
APPARATUS FOR PROCESSING HERBACEOUS PLANT MATERIALS INCLUDING THE
CANNABIS PLANT." According to a prior release, that extraction
process provides quality extracts comparable to GW Pharma
(NASDAQ: GWPH). GW
Pharma was purchased by Jazz Pharmaceuticals (NASDAQ: JAZZ) for
$7.2 billion earlier this year. Thus, investors have reasons to be
bullish.
Also catching a good amount of attention is the announcement
that PAOG is working with Veristat, a contract research
organization (CRO). That agreement is expected to leverage
Veristat's expertise, which is dedicated to advancing clinical
therapies and treatments through regulatory approval. PAOG is also
expected to soon announce new breakthroughs in its CBD RespRx
pharmaceutical research.
Other deals are earning attention as well.
Partnerships To Accelerate Commercialization
Last month, PAOG released a comprehensive update on its CBD
Nutraceutical Development Program, saying that the first CBD
nutraceutical product is expected to come to market before the end
of the year. That effort is supported by Alkame Holdings, Inc.
(USOTC: ALKM) and
North American Cannabis Holdings, Inc. (USOTC: USMJ), who
will contribute to the logistics and marketing side of the product
launch.
Now, with the run toward commercialization in play, investors
are paying close attention to how PAOG can capitalize during the
remainder of the year. Notably, investors appear to be investing
ahead of the news, purchasing what they believe are significantly
undervalued shares. In February, shares traded approximately 100%
higher than current levels, and the information this morning could
ignite a rally back toward those levels. Volume on Monday was
substantial, with more than 47 million shares trading hands. Follow
through today could indicate momentum is on PAOG's side.
Revenue Is A Defining Advantage For PAOG
Of interest as well is that PAOG is a generating company. That,
in and of itself, could help drive share prices higher. PAOG said
it expects to generate $300,000 in sales from its cannabis
cultivation subsidiary. Although not a lot by large-cap standards,
for PAOG, it could be enough to bring its products to market and
increase R&D efforts to target other CBD-based therapeutics and
nutraceutical market opportunities. In fact, it could have helped
secure its second acquisition and retain Veristat to represent its
interests.
In addition to revenues, many think that PAOG can benefit from
consolidation in the sector. With JAZZ purchasing GW Pharma for
$7.2 billion earlier this year, investors quickly turned back to
CBD stocks, especially toward emerging players that can be
partnered with or purchased at discounted prices. However, those
prices have been rising, causing some to speculate that the
consolidation pace will speed up in 2021. And that could be
excellent news for PAOG.
Keep in mind that PAOG shares are higher by more than 385% YTD.
Thus, the 21% gain on Monday only adds to an already staggering
share price increase. Moreover, the rally started last week is
news-based, and the update on Tuesday added fuel to the bullish
premise that PAOG could deliver at least two catalysts later this
year.
Better still, with two therapeutics in play, PAOG is ideally
positioned to create shareholder value from partnerships and/or
licensing agreements. In fact, with its drugs targeting
billion-dollar markets, it's likely that as the company nears its
planned commercialization that offers could be entertained. The
patented extraction process could be the lynchpin in getting a deal
done if they elect to go that route.
Clearly, investors are responding well to the company's
developments. For a nano-cap stock, PAO Group has an impressive
product pipeline in mid and late-stage development. As each program
moves closer to getting its product approved for sale, PAOG could
see a run.
With multiple shots on goal, having an agreement with a CRO, and
partnerships that can accelerate product commercialization, PAOG is
a small stock that could deliver massive rewards. This one is
definitely ripe for consideration.
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Source - https://www.marketwatch.com/press-release/pao-group-inc-rallies-21-on-monday-investor-update-this-morning-adds-fuel-to-bullish-sentiment-2021-04-13
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