SeeThruEquity Issues Update on ChineseInvestors.com Inc. (OTCQB: CIIX), Increasing Price Target to $3.75
March 6, 2017
ChineseInvestors.com, Inc. (OTCQB: CIIX, "CIIX") is a relatively undiscovered specialized investment services company with several intriguing business lines high growth potential and a compelling valuation based on previous peak cycle earnings. With headquarters in Los Angeles, CA, CIIX offers a range of intriguing consulting services, information products, and web-based tools for investor education, including real time market commentary, analysis and education in Chinese language character sets. The company demonstrated impressive profit in 2014, and we believe the earnings power displayed at the top of the cycle is a fact largely overlooked on Wall Street. Recently, CIIX has made several announcements highlighting growth potential from its investments in the global cannabis industry, a new a quickly growing market with large potential. These include the recent launch of what management called "world's first Cannabidiol (CBD) health products online store in the Chinese Language," as well as a Chinese language Yelp-style mobile application that will contain a location-enabled database of recreational and medical marijuana dispensaries, as well as a platform to review and discuss various cannabis products.
Several catalysts ahead as CIIX gains cannabis exposure
In addition to value available from CIIX's core financial information and consulting services for Chinese-speaking investors in the U.S. and China, CIIX appears to have taken significant strides to increase its exposure to the burgeoning global cannabis industry. As we have noted throughout our coverage, CIIX was able to gain early exposure to the rise in cannabis stocks and evolving trend towards legalization with its stake in publicly traded Medicine Man Technologies, Inc. (OTCQB: MDCL). Medicine Man Technologies, provides consulting services related to cultivation, production, and dispensary operations to 19 clients in eleven US states and Puerto Rico, with a market capitalization of $28.3mn as of January 17, 2017. According to SEC filings, CIIX generated $2.3mn in proceeds from stock sales of Medicine Man during calendar 2016. We estimate that the company has nearly exited this position, and that any remaining shares have been held debt collateral. CIIX has addressed short term liquidity needs, however, with the issuance of $4.7mn in Series C Preferred Stock, as disclosed in its 10-Q filed on January 23, 2017.
CIIX launches first Cannabidiol (CBD) health products online store in the Chinese Language
In February, CIIX launched what it has described as the first cannabidoil (CBD) health products online store in the Chinese language. The web site, www.ChineseCBDoil.com, is intended to be a retail destination for nutritional supplements containing CBD to the Asian market through both online and in-store sales. The announcement follows CIIX's plan to launch a Chinese language Yelp-style mobile app for locating dispensaries and discussing cannabis products in the US, and a December announcement that it had entered into an alliance with Chinese private equity firm Shenzhen Yuanrong PE Capital seek out opportunities in medical and recreational cannabis.
Price target moves to $3.75
We are increasing our price target to $3.75 at this time, reflecting potential from the company's legal cannabis initiatives. CIIX remains in the early stages of penetrating this market, however, the increased market opportunity and CIIX's prior success in the cannabis industry with its investment in Medicine Man should support the view that it can capitalize on a unique approach to broad cannabis industry growth.
Click here for the entire press release: CIIX Press Release
Click here for the update note: CIIX Update Note
