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• Organto announced that it has expanded into Asia with an international retailer and plans to grow this market over the coming years
• OGO also announced that it plans to expand into North America in late 2023 (initially with the U.S.).
• OGO obtained additional debt financing of $1.05M to support growth and working capital.
Organto Foods (OGO:TSXV) has reported several updates over the last month that reaffirmed our confidence in its growth strategy and positioning moving forward. This includes its plans to expand into North America, expansion into Asia, increasing its debt facilities, and consolidating its common shares. We are maintaining our BUY rating and $2.00/share target price on OGO.
North America Expansion
This morning, Organto announced that it plans to expand its platform into North America, initially the U.S. market. OGO plans to leverage its vast expertise in sourcing, distributing, and marketing fruits and vegetables to enter the large U.S. geography in late 2023. Management stated that the expansion will enhance the services that OGO can provide to its supply partners and international customers. The U.S. represents the largest organic food market globally. This has been on OGO’s strategic roadmap since our initiation report, and the management team has now begun to execute.
Asia Expansion
On October 3rd, OGO announced that it has successfully expanded its sales into Asia with an international retailer. This represented Organto’s first substantive sales outside of its European markets. The sales are being managed by OGO’s commercial platform in the Netherlands for distribution in the retailer’s Chinese operations. Management commented that working closely with an international retailer allows OGO to take advantage of their market knowledge while leveraging OGO’s sourcing capabilities. Our estimates remain unchanged as we wait to see the financial significance of the expansion over the coming quarters.
OGO: Expanding into Asia & North America
What you need to know:• Organto announced that it has expanded into Asia with an international retailer and plans to grow this market over the coming years
• OGO also announced that it plans to expand into North America in late 2023 (initially with the U.S.).
• OGO obtained additional debt financing of $1.05M to support growth and working capital.
Organto Foods (OGO:TSXV) has reported several updates over the last month that reaffirmed our confidence in its growth strategy and positioning moving forward. This includes its plans to expand into North America, expansion into Asia, increasing its debt facilities, and consolidating its common shares. We are maintaining our BUY rating and $2.00/share target price on OGO.
North America Expansion
This morning, Organto announced that it plans to expand its platform into North America, initially the U.S. market. OGO plans to leverage its vast expertise in sourcing, distributing, and marketing fruits and vegetables to enter the large U.S. geography in late 2023. Management stated that the expansion will enhance the services that OGO can provide to its supply partners and international customers. The U.S. represents the largest organic food market globally. This has been on OGO’s strategic roadmap since our initiation report, and the management team has now begun to execute.
Asia Expansion
On October 3rd, OGO announced that it has successfully expanded its sales into Asia with an international retailer. This represented Organto’s first substantive sales outside of its European markets. The sales are being managed by OGO’s commercial platform in the Netherlands for distribution in the retailer’s Chinese operations. Management commented that working closely with an international retailer allows OGO to take advantage of their market knowledge while leveraging OGO’s sourcing capabilities. Our estimates remain unchanged as we wait to see the financial significance of the expansion over the coming quarters.
Underlying
Organto Foods Inc
Provider
Atrium Research Corporation
Atrium Research provides institutional quality issuer paid research on North American public equities using deep fundamental analysis. Our research reports are disseminated through Bloomberg, FactSet, Capital IQ, Reuters and many more, as well as through our social media and email distribution lists.
Nicholas Cortellucci, CFA
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