Verus Stock (OTCMKTS:VRUS) has seen renewed investor interest in recent weeks. That has helped propel the stock from last year’s low of $0.0020 to about $0.0190. Although the stock has retreated to about $0.0160 in the past few days, it has found strong support at $0.0150.
The renewed investor interest in Verus stock comes on the back of a big growth in sales and plans to upgrade the stock listing to major exchange. The excitement in Verus stock also comes as the company has kept its debt level under control and hired a financial auditing and advisory firm of repute.
Additionally, investors are warming up to Verus stock as the company plans to open a new manufacturing capacity in Texas that will enable it to operate more efficiently as it works to maximize shareholder value. Below we examine in details the reasons investors are showing renewed interest in Verus stock. But first, here is the profile of the company are discussing.
About Verus Stock
For those investors coming across Verus for the very first time, a brief introduction is in order. Verus is a US-based global consumer food products company. It operates in the consumer packaged goods (CPG) sector and has a diversified product line and a range of brands. In addition to the United States, Verus has operations in South America and the Middle East. The company sells its products through supermarkets, hotels and other retail establishments.
Verus is one small-cap stock that investors are really jostling to own in 2020. For investors with a long-term view, there is a lot to like in Verus. Here are some of the reasons investors have warmed up to Verus stock lately and why you shouldn’t miss this great opportunity.
Verus making big sales as demand for its products soar
Verus has continued to record robust growth in sales, a confirmation of strong demand for its products. Revenue soared 154% year-over-year to an all-time high of $3.5 million fiscal third quarter. The management expects Verus to sustain its triple-digit revenue growth rate over the next several quarter. And there is a good reason why that is possible for Verus. The company finished the third quarter with $34 million un funded order backlog, the largest in its history and another testament to strong demand for its products.
Verus looking to list its stock on a major exchange
Verus aimed to list its stock on a major exchange in 2019. Although Verus missed that target last year, listing on a major exchange remains a top goal for the management and could happen in 2020.
It is the dream of every small-cap company out there to have its stock listed on a major exchange like the NASDAQ or NYSE. Listing on a major exchange will help enhance the exposure of Verus stock to investors, particularly big institutional investors, and that could in turn drive more interest in the stock and boost valuation.
Verus has manageable debt and soaring revenue provides ample cash to invest in more growth
Verus has entered into some credit arrangements to raise more funds to investment in its development. However, the company has maintained a very manageable debt load. It finished the third quarter with $1.6 million in debt against $4.2 million in total assets, consisting of over $400,000 cash reserve.
With revenue growing rapidly, access to cash to invest in growth would not be a major problem for Verus. In fact, Verus was able to turn a net profit of about $500,000 in the first nine months of fiscal 2019, marking a huge improvement from a loss of $1.5 million in a similar period in 2018. The profit, though modest, is a testament to Verus’s strengthening financials.
As it works on improving its financials, Verus has retained the services of a reputable auditing and advisory firm. The company has hired CBIZ MHM as its independent public accounting firm. In that role, CBIZ MHM will provide financial auditing and a range of advisory services to Verus. CBIZ MHM, a unit of CBIZ, Inc., is one of America’s top 10 accounting providers and maintains a team of more than 2,000 professionals across the country.
Verus sets up its own manufacturing facility
Verus has long relied on contract manufacturers to produce its brand of food products for sale domestically and overseas. But that is starting to change as the company seeks to operate more efficiently. The company has set up its first manufacturing facility in Houston, Texas, which is almost ready to begin operations. The first batch of products from the Texas facility will be MLB-themed items for the MLB selling season in spring.
Verus CEO Anshu Bhatnagar described the opening of the Texas facility as a strategic move. According to the executive, the existing global manufacturing capacity of the kind of products that Verus makes is strained.
Verus is a small-cap stock with bright prospects that has been flying under the radar. At current levels, Verus stock is a discount entry opportunity.
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Disclosure: We have no position in Verus stock and have not been compensated for this article.