This article by Jason Najum was originally published on Microdose Psychedelic Insights and appears here with permission.
The psychedelic medicine industry continues to get attention and gain credibility in the investment world.
Analysts from investment firms have been steadily increasing their coverage of the psychedelic space, from Cybin receiving several positive reports to Compass getting a strong Buy rating, to the Maxim Group initiating coverage on ten shroom stocks.
Several major firms like Canaccord Genuity and Cantor Fitzgerald have also joined the coverage action, and this week Eight Capital initiated coverage on 6 psychedelic stocks, giving them all strong Buy ratings.
Eight Capital Gives Buy Rating to 6 Shroom Stocks
Eight Capital analyst Sepehr Manochehry led the coverage, focusing on 6 psychedelic firms. The firm published an industry report a few months ago, giving their clients a review of the industry; and now, according to the analyst:
“The psychedelic industry is rapidly evolving, due to a combination of an increasingly favorable regulatory environment, a large influx of capital, and a growing body of clinical trial data on the use of psychedelics and related substances demonstrating a remarkable degree of efficacy in a range of mental health conditions, making this an optimal time for investing in well-positioned operators we highlight herein.”
Well said. Now let’s look at the details of the report and which companies Eight Capital believes are the best psychedelic bets (All figures in Canadian dollars. Details taken from the Eight Capital report, found here).
Current price: $3.10
Target price: $6.50
Citing a diversified product portfolio that helps hedge risk, a new CEO with the relevant industry experience to take the company through the next stages, and the addition of digital tools and new patents – MindMed received a Buy rating and target price that’s more than double its current price.
Current price: $2.76
Target price: $8.15
Cybin’s advanced clinical trial using its proprietary oral delivery of psilocybin to treat depression is the biggest price catalyst here. The company is well-positioned to use this product as a differentiator in the race for getting psilocybin treatments to market. Cybin has also expanded its IP and development pipeline and has added key partnerships in the in-person clinic market.
The $8.15 target is almost 200% of its current price.
Bright Minds Biosciences (OTC:BMBIF)
Current price: $6.90
Target price: $11.50
The report gives Bright Minds a Buy rating and $11.50 price target, a solid jump from its current price level. The report cites the potential of its lead asset BMB-101, which aims to tackle a variety of serious conditions, as well as the company’s experienced team and robust intellectual property portfolio. The next 12-18 months should see several catalyzing milestones for the company.
Field Trip Health (NASDAQ:FTRP)
Current price: $5.60
Target price: $10.20
Field Trip gets points for being a leader in treatment clinics (plans to expand to 20 clinics by the end of the year), as well as entering the drug development space with its lead drug FT-104. Being uplisted to the NASDAQ doesn’t hurt either.
The report gave Field Trip a Buy rating and a bullish $10.20 price target
Numinus Wellness (OTC:LKYSF)
Current price: $0.79
Target price: $1.10
Numinus’ industry-leading development diversification is the main reason for its Buy rating.
“We expect to see the Company expand its reach in the coming quarters, through a series of accretive acquisitions where it will look to acquire clinics that will bring it access to relevant patient groups in new jurisdictions where the Company will bolt-on higher-margin psychotherapy services like psychedelic-assisted therapy to drive operational synergies post-acquisition. Alongside the expansion of its network of clinics, the Company’s mushroom-derived psilocybin extract formulation is set to enter clinical development, thereby generating data that can position the Company as a leading commercial-stage supplier of psilocybin following eventual approval. In the interim, the Company’s extraction capabilities and its Health Canada Dealer’s license put it ahead of peers who are limited to higher-cost sources of active ingredients and more restrictive regulations around possession, research, and sale of psychedelics.”
Red Light Holland (OTC:TRUFF)
Current price: $0.23
Target price: $0.35
Red Light Holland’s aggressive acquisition strategy and foothold in the European recreational psilocybin retail market give it a competitive advantage.
“The Company’s Netherlands operations give it access to other low-barrier jurisdictions in Europe (e.g. Portugal, Czech Republic, etc). It has also established access to its iMicrodose kits for patients in Brazil, on a prescribed basis. Furthermore, RLH recently acquired Mera Life Sciences, a Caribbean-based operator where local regulations allow for the Company to work with naturally-derived psychedelic compounds including psilocybin, ibogaine, mescaline, dimethyltryptamine, and many others. RLH’s revenue-generating operations centered around production, sale, and distribution of psychedelic substances, stand to benefit from such broad access to psychedelic compounds as it works to expand its offerings, and its reach across more jurisdictions.”