RiceBran Technologies (NASDAQ: RIBT) is a global leader in developing and producing healthy, natural, and nutrient dense products derived from rice and other small grains. RIBT stock has been gaining momentum as the war in Ukraine puts pressure on food supply chains. RIBT stock gained 86% since the beginning of May and could continue running as the global food crisis intensifies with India banning grain exports. With companies in this sector attracting many investors, RIBT stock is shaping up to be one of the hottest plays this quarter.
RIBT Stock News
Focused on providing creative solutions for food and feed applications, RIBT utilizes its technologies, facilities, and experience to convert raw rice bran into stabilized rice bran and high value derivative products. Through this, RIBT looks to capitalize on the nutritional and economic value of the so far underutilized rice bran. This food product is a dense nutrient source of protein, fats, fiber, and carbohydrates as well as vitamin E and antioxidants. In light of this, rice bran can be utilized in a number of products from health foods to animal feed.
Currently, RIBT is working on expanding the uses of rice bran to unlock its massive potential. Using its technologies, RIBT is able to increase the nutritional value and the flexibility of rice bran for more applications. Rice bran is notably underutilized in the feedstock sector compared to other feedstocks like soybean. Despite the growing popularity of soy products, 77% of global soy produced is used to feed livestock.
In this way, the company is targeting the growing potential for its products to take on the same utilization as soybean products which have recently come under criticism for their harmful effects on the environment.
With a utilization rate of only 4%, the US rice bran market would increase to $380 million if its utilization increases to 13% – equivalent to soybean’s current share of the market. With this in mind, RIBT stock could be a profitable investment if the company is able to increase its hold on this market through its range of products.
Products
The company’s main offering, RiBran is extremely versatile due to its neutral flavor. At the same time, this ingredient is rich with dietary fiber, fatty acids and protein. In light of this, RiBran can be used to produce several products like cereals, snacks, animal feed, and even beverages.
But RIBT’s flagship derivative powder – RiBalance – is a complete rice bran nutritional package derived from additional processing of the rice bran. As a good source of vitamins and amino acids, RiBalance is mainly used in producing meal replacements, nutritional bars, and cereals.
While this product is very similar to RiBran, RiBalance is a ready-to-eat product. Given that the $11.9 billion meal replacement market is expected to grow to $15.5 billion by 2026, RIBT’s unique product could takeoff in the current health foods market.
Along the same lines, RiSolubles provides a sweeter taste to powdered ready-to-drink beverages, dietary supplement processing aids, and more. For this reason, RiSolubles is used in the production of powdered ready-to-drink beverages, dietary supplement processing aids, and more. Thanks to its increased binding activity it also has applications to gluten free cooking.
The company also offers a source of natural fibers and proteins, RiFiber, which is a nutritionally rich RTE ingredient approved by the USDA for use in meat and poultry applications. The company sees its applications ranging from sports nutrition powders, bars, snacks to Gluten-free baking and dietary supplements.
Last but not least is a product mainly designed as a feed ingredient for the animal nutrition markets – NutraCea, a highly palatable form of additional calories and protein. Designed for building and maintaining muscle as well as improving skin and coat conditions, NutraCea is intended for performance horses, livestock, and companion animals. The vitamins and amino acids found in the stabilized rice bran are used in producing dog food which the company hopes to capitalize on as well.
All together ricebran presents a $2 billion market which RIBT could capitalize on through its range of products.
Other Grains
In the same vein, RIBT anticipates using its technology to capitalize on the oat meal market with added value offerings. Considering the growing demand for oat milk, RIBT points to the possibility for oat and barley derivatives, such as beta-glucans, for human food and
supplement applications as well as ground oats as a starter material for the oat milk market.
The company highlighted that while corn, wheat and soy coproduct markets are dominated by massive companies, the market for small and ancient grains is made up of smaller players and RIBT has the opportunity to position itself at the forefront.
Management
With the company looking to expand its business, RIBT added Jean Heggie and Will Black to its BOD. As the founder of a food industry consultancy – Heggie & Associates, LLC, Heggie has over 35 years of experience in food ingredient marketing. Heggie has previously worked as a Global Marketing Lead for DuPont Nutrition & Biosciences’ Protein Solutions business unit where she led the development of the company’s marketing plan for its plant protein portfolio.
In addition, Black is considered to be a global health and nutrition guru with 35 years of experience. During his career, Black served as Senior Vice President of Sales and Marketing at ChromaDex, COO at Natreon, as well as Global Head of Marketing of Human Nutrition and Health at DSM Nutritional Products. Moreover, Black held senior roles at Dupont Nutrition and Health in sales, marketing and business development for the Solae business unit. At the same time, Black is the founder and CEO of Single Track Consulting, LLC which is focused on global advisory for the nutrition and health sectors. Considering the vast experience of both Heggie and Black, RIBT is well-positioned for further growth as a value-added ingredient provider.
Insider Activity
Although RIBT’s business has the potential to grow further as more people realize the potential of rice bran, the company’s major shareholder – Continental Grain Co. – has filed a notice with the SEC to state its intention to sell up to 3.8 million shares of RIBT stock. So far, CGC sold over 1.5 million shares since March.
Despite this insider selling, several institutions have been adding shares of RIBT stock since April. This institutional buying is highlighted by Arnhold LLC which increased its position by 23% on May 10th. While the institutional buying is mixed with insider selling, this could be a sign that news is on the way for RIBT.
*Updated June 1st
India Export Ban
With grain supplies falling short across the world, India shocked investors by banning wheat exports – causing grain prices to surge. Now, experts believe that India could impose a ban on its rice exports as well. Given that India is the world’s largest rice exporter, banning rice exports would threaten global food security. This issue not only highlights the value RIBT brings via its products but also presents an opportunity for it to capitalize on the crisis through its rice bran offerings.
Facility Expansion
Meanwhile, RIBT has decided to expand its MGI facility in Minnesota to meet increasing demand for the company’s products. Through this expansion, RIBT expects to double the facility’s production capacity while improving quality. The company also announced its plans to expand its Core-SRB facility in Mermentau, Louisiana. This expansion will help RIBT meet growing demand for its products in the companion animal market which RIBT has been making inroads towards. Currently, the project is estimated for completion in Q3 and RIBT’s Chairman is bullish that its expansion will help the company take advantage of the market’s “tremendous growth” due to the number of people that acquired animal companions during the Covid epidemic. Bradley noted that there is currently a structural shift in the industry towards stabilized rice bran ingredients and RIBT is eager to respond. The demand for its products which led to these expansions is a bullish sign and could be an indication of additional growth in RIBT’s future.
These improvements come after RIBT put into place a new strategy in 2021 to put the company on a path towards sustainable growth and profitability by focusing on higher added value ingredients. This combined with new product introductions and a stronger market reach thanks to its distribution agreement with AIDP, has put the company in a better position to achieve its goals according to RIBT’s CEO. The company also noted that its domestic manufacturing capabilities make it attractive in periods of global supply chain disruption such as now.
Board Members
As part of the company’s transition, RIBT introduced two new Board members whose experience has led some investors to speculate that RIBT could be planning to make inroads towards ____. The speculation is largely fueled by Jean Heggie, the founder of a food industry consultancy for groups within the food and agriculture industries. She is also the spokesperson for the United Soybean Board which has made many wonder if her expertise could help RIBT expand its product portfolio. Jean brings her experience from a 33-year career in food ingredient marketing at DuPont Nutrition & Biosciences to RIBT as well.
Meanwhile the second board member – Will Black – has 35 years of experience in the global health and nutrition industry. He worked for a bioscience company focused on healthy aging nutraceuticals as well as at DuPont Nutrition and Health. At DuPont, Black worked for the Solae business unit focusing on the development and applications of high-value soy proteins and fiber for the food, beverage and meat analogue industries. Together these two board members are expected to improve consumer-facing sales, marketing and product development through their expertise and relationships.
Shareholders Meeting
These appointments come before RIBT’s scheduled shareholder’s meeting on July 14th where the company will appoint five new directors to its board. Also on the agenda is an important decision regarding amendments to RIBT’s articles which would effect a reverse stock split “pursuant to which either five, ten, fifteen, twenty, or twenty-five outstanding shares of RiceBran Technologies common stock would be combined into one share” on or before July 14th 2023 if agreed. An amendment to increase its common stock by 6 million shares will also be discussed as well as compensation for its executive officers, and the appointment of an accounting firm.
RIBT Stock Financials
According to its Q1 financials, RIBT reported $10.5 million in revenues representing a 23% increase from the same year-ago period. However, despite this increase the company reported a net loss of $1.5 million. RIBT also reported $31.3 million in assets and an increase in its liabilities from $12.8 million in Q1 2021 to $14.1 million. As the company is able to realize increasing revenues from its business, the company has the chance to report a net profit by the end of year.
This is inline with Peter Bradley’s perspective – RIBT’s CEO – who shared that the company has “streamlined operation and addressed the issues that have hampered execution, so incremental revenue should continue to leverage as further improvements in profitability enable us to transition to positive adjusted EBITDA as revenues continue to grow and our product mix which shifts away from more of our commodity business.”
In Q1 and Q2 of 2021, the company achieved a gross profit after achieving $8.6 and $7.6 million in those respective quarters. The company notes that its financial profile has been improving after exiting 2021 with a positive revenue trend across all businesses and progressively declining gross losses. This resulted in adjusted EBITDA losses decreasing to $385,000 and strong liquidity with$5.9 million in cash on the balance sheet. Gross profits were recorded as $502,000 – a drop from $670,000 a year ago. RIBT also reported a net loss of $1.5 million for the quarter.
Media Sentiment
@PJ_Matlock believes that RIBT will continue to rise as shareholders keep holding
@richXmillion and @StocksThatRips believe RIBT could be entering the soy market.
Technical Analysis
RIBT stock is currently trading at $.74 and has supports near .6402, .5849, and .5108. It has a clear resistance at .7949 and near .92. The stock has continued its run thanks to the company’s updates and macro-level events which have helped boost the stock’s momentum as its consistently traded on higher than average volume.
Given that companies in the grains sector are becoming increasingly attractive to investors, RIBT stock become a favorite for those looking for agriculture plays. Accumulation has remained very strong and is still increasing while the MACD is bullish to the upside and the RSI is holding at 60. Considering RIBT’s recent announcements, the stock could be set to continue its green streak, With an OS of 51.8 million and a low float of 50.2 million, RIBT stock could continue moving easily with momentum.
We alerted RIBT stock at $.52, if you want to catch the next free alert join our alerts room!
RIBT Stock Forecast
As the company continues to develop and produce rice bran derived products, RIBT could grow as a leader in this underutilized sector. With the company’s wide range of products, RIBT has the opportunity to position itself in this $2 billion market.
Given the recent stresses on supply chains, RIBT’s 100% grown and processed in the US products are an asset. On top of this, the demand for non-GMO and gluten-free products are creating a market which RIBT is well positioned to capitalize on with its portfolio of products. The company’s expansion of its production facilities is a sign of the demand its products are receiving from multiples markets. As the company continues to strengthen its balance sheet after showing notable growth over the last year, RIBT stock presents significant long-term potential.
If you have questions about RIBT stock and where it could be heading next feel free to reach out to us in our free alerts room!
Disclaimer
Please visit and read our disclaimer here.
