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Microcap & Penny Stocks : Stateside's Canadian Microcap Board

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To: jorjen who wrote (1317)	11/12/2015 11:13:02 AM
From: WorthaDeeperLook	Read Replies (1) of 1728

I just have a few concerns on how they will finance the new plant extension. They already have lots of debt on their balance sheet. Plus, relocating production to a new plant could slow down growth while they ramp up production there. Management intend to build up inventory to prevent any disruption in the supply of current customers, but that will put some stress on the balance sheet too. They had a great quarter, but sales are lumpy and only grew 6% yoy in the first nine months. I think Ceapro has a bright future. However, I would be cautious not to overpay. The risk-reward profile isn't much different than it was when the company was trading in the low 0.20$... A few news releases about their pipeline and a record quarter in (lumpy) sales) brought new eyes to the story and the renewed momentum is encouraging... but don't overpay! When the new plant will be finished and fully operational, then the thesis will be significantly de-risked imo.

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