Taglich Brothers Publishes Updated Coverage Report on Cosmos Health; Maintains Price Target of $4, Nearly 300% Above Current Share Price

Rhea-AI Summary

Taglich Brothers has published an updated coverage report on Cosmos Health (NASDAQ:COSM), maintaining a Speculative Buy rating with a $4 price target, nearly 300% above the current share price. The report highlights significant growth expectations as Cosmos transitions into a vertically integrated global health organization. Key drivers include increased contract manufacturing at Cana Laboratories and expanded distribution agreements for nutraceutical and disinfectant brands in Europe and the Middle East.

Taglich forecasts FY 2024 revenue at $56.3 million, with a 22.6% increase to $69.0 million in FY 2025, alongside a projected operating profit of $20,000 and cash earnings of $1.6 million. The report suggests that Cosmos Health's valuation should improve with revenue growth and transition to profitability, as its current price-to-sales multiple (0.3X) lags behind the 2.4X sector average.

Positive

• Taglich Brothers maintains a $4 price target, implying a nearly 300% potential increase in share price
• FY 2024 revenue forecast of $56.3 million, with a 22.6% increase to $69.0 million in FY 2025
• Projected operating profit of $20,000 and cash earnings of $1.6 million for FY 2025
• Expansion of contract manufacturing at Cana Laboratories and distribution agreements for proprietary brands
• Analyst expectation of Cosmos becoming cash flow positive in 2025

Negative

• Current price-to-sales multiple (0.3X) significantly lags behind the 2.4X sector average
• Execution risks and potential warrant dilution factored into the price target
• Minimal operating profit projection of $20,000 for FY 2025

Insights

Financial Analyst

The updated coverage report from Taglich Brothers highlights Cosmos Health's potential for significant growth, but investors should approach this analysis with caution. The $4 price target, representing a 300% upside, is based on ambitious projections and a significant multiple expansion.

While the forecast of $56.3 million in FY 2024 revenue growing to $69 million in FY 2025 is impressive, the projected operating profit of just $20,000 raises concerns about profitability. The expected cash earnings of $1.6 million in 2025 seem modest relative to the revenue.

The valuation argument relies heavily on multiple expansion from 0.3X to 1.4X price-to-sales, which may be optimistic given the current market conditions and the company's financial performance. Investors should carefully consider the execution risks and potential dilution mentioned in the report before making investment decisions based on this price target.

Market Research Analyst

Cosmos Health's transition into a vertically integrated global health organization presents both opportunities and challenges. The company's strategy to leverage Cana Laboratories for contract manufacturing and expand distribution of its nutraceutical and disinfectant brands in Europe and the Middle East could drive growth. However, these markets are highly competitive and regulated.

The projected revenue growth from $56.3 million to $69 million between 2024 and 2025 is ambitious, representing a 22.6% year-over-year increase. Achieving this growth while transitioning to profitability will require flawless execution and market acceptance of their products.

Investors should monitor key performance indicators such as market penetration rates, customer acquisition costs and regulatory approvals in new markets. The success of Cosmos Health's expansion strategy will heavily depend on these factors, which are not fully addressed in the coverage report.

CHICAGO, IL / ACCESSWIRE / September 17, 2024 / Cosmos Health Inc. ("Cosmos Health" or the "Company'') (NASDAQ:COSM), a diversified, vertically integrated global healthcare group engaged in innovative R&D, owner of proprietary pharmaceutical and nutraceutical brands, manufacturer and distributor of healthcare products, and operator of a telehealth platform, announced today that on September 16, 2024, Taglich Brothers, Inc. ("Taglich Brothers") published its updated research report on the Company's common stock.

Key highlights of Taglich Brothers' updated coverage report include:

• Maintains Speculative Buy rating with a $4 price target, implying a nearly four-fold share price increase over the next 12 months.

• Significant growth is expected as the Company transitions into a vertically integrated global health organization, driven by increased contract manufacturing at Cana Laboratories and expanded distribution agreements for its nutraceutical and disinfectant brands in Europe and the Middle East.

• FY 2024 revenue is forecasted at $56.3 million, with a 22.6% increase to $69.0 million in FY 2025, alongside a projected operating profit of $20,000 and cash earnings of $1.6 million.

• Valuation should improve with revenue growth, transitioning to operating profit and positive cash earnings, as Cosmos Health's price-to-sales multiple (0.3X) lags behind the 2.4X sector average for similar companies in medical distribution and drug manufacturing.

• Investors are likely to assign a valuation multiple closer to industry standards. Applying a 1.4X price-to-sales multiple to the 2025 sales per share forecast of $3.86 supports the $4 price target, factoring in execution risks and potential warrant dilution.

Greg Siokas, CEO of Cosmos Health, stated: "I am pleased that Taglich Brothers has reaffirmed its price target of $4-nearly four times our current share price. Taglich highlights strong growth potential driven by, among other factors, our strategic investments in Cana, including new contract manufacturing agreements, and the expansion of our proprietary brands globally. In fact, Taglich expects Cosmos to be cash flow positive in 2025. As I've consistently emphasized, I believe our stock remains undervalued given our achievements and growth outlook, and I'm encouraged to see that Taglich shares this view."

About Cosmos Health Inc.

Cosmos Health Inc. (Nasdaq:COSM), incorporated in 2009 in Nevada, is a diversified, vertically integrated global healthcare group. The Company owns a portfolio of proprietary pharmaceutical and nutraceutical brands, including Sky Premium Life®, Mediterranation®, bio-bebe® and C-Sept®. Through its subsidiary Cana Laboratories S.A., licensed under European Good Manufacturing Practices (GMP) and certified by the European Medicines Agency (EMA), it manufactures pharmaceuticals, food supplements, cosmetics, biocides, and medical devices within the European Union. Cosmos Health also distributes a broad line of pharmaceuticals and parapharmaceuticals, including branded generics and OTC medications, to retail pharmacies and wholesale distributors through its subsidiaries in Greece and the UK. Furthermore, the Company has established R&D partnerships targeting major health disorders such as obesity, diabetes, and cancer, enhanced by artificial intelligence drug repurposing technologies, and focuses on the R&D of novel patented nutraceuticals, specialized root extracts, proprietary complex generics, and innovative OTC products. Cosmos Health has also entered the telehealth space through the acquisition of ZipDoctor, Inc., based in Texas, USA. With a global distribution platform, the Company is currently expanding throughout Europe, Asia, and North America, and has offices and distribution centers in Thessaloniki and Athens, Greece, and in Harlow, UK. More information is available at www.cosmoshealthinc.com, www.skypremiumlife.com, www.cana.gr, www.zipdoctor.co, as well as LinkedIn and X.

Forward-Looking Statements

With the exception of the historical information contained in this news release, the matters described herein, may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements preceded by, followed by, or that otherwise, include the words "believes," "expects," "anticipates," "intends," "projects," "estimates," "plans" and similar expressions or future or conditional verbs such as "will," "should," "would," "may" and "could", are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. These statements, involve unknown risks and uncertainties that may individually or materially impact the matters discussed, herein for a variety of reasons that are outside the control of the Company, including, but not limited to, the Company's ability to raise sufficient financing to implement its business plan, the impact of the COVID-19 pandemic and the war in Ukraine, on the Company's business, operations and the economy in general, and the Company's ability to successfully develop and commercialize its proprietary products and technologies. Readers are cautioned not to place undue reliance on these forward- looking statements, as actual results could differ materially from those described in the forward-looking statements contained herein. Readers are urged to read the risk factors set forth in the Company's filings with the SEC, which are available at the SEC's website (www.sec.gov). The Company disclaims any intention or obligation to update, or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Disclaimer

All research issued by Taglich Brothers is based on public information. The Company does not undertake the responsibility to advise you of changes in figures or in their views. The Company pays a fee of $3,000 per month for 12 months for research coverage, which includes the creation and dissemination of research reports. This is not a solicitation of any order to buy or sell. Taglich Brothers, fully disclosed with its clearing firm, Axos Clearing, LLC, is not a market maker and does not sell to or buy from customers on a principal basis. There is no guarantee that the target price for the stock will be met or that the predicted business results for the Company will occur. There may be instances when fundamental, technical, and quantitative opinions contained in Taglich Brothers' reports are not in concert. Taglich Brothers does not currently have an Investment Banking relationship with the Company and was not a manager or co-manager of any offering for the Company within the last three years.

Investor Relations Contact:

BDG Communications
cosm@bdgcommunications.com
+44 207 0971 653

SOURCE: Cosmos Health Inc.

View the original press release on accesswire.com

FAQ

What is Taglich Brothers' price target for Cosmos Health (COSM) stock?

Taglich Brothers maintains a $4 price target for Cosmos Health (COSM) stock, which is nearly 300% above the current share price.

What is the revenue forecast for Cosmos Health (COSM) in FY 2024 and FY 2025?

Taglich Brothers forecasts Cosmos Health's (COSM) revenue at $56.3 million for FY 2024, with a 22.6% increase to $69.0 million in FY 2025.

When is Cosmos Health (COSM) expected to become cash flow positive according to the Taglich Brothers report?

According to the Taglich Brothers report, Cosmos Health (COSM) is expected to become cash flow positive in 2025.

What are the main growth drivers for Cosmos Health (COSM) mentioned in the Taglich Brothers report?

The main growth drivers for Cosmos Health (COSM) mentioned in the report are increased contract manufacturing at Cana Laboratories and expanded distribution agreements for nutraceutical and disinfectant brands in Europe and the Middle East.