22nd Century Group Inc (XXII)

[Atlanta1]

from Chardan's 6/7/2018 report:

We maintain our Buy recommendation on 22nd Century and reiterate our 12-month price target of $11.50. We believe
22nd Century’s patents, covering nicotine regulation in tobacco plants, is a solution to the FDA’s pending regulation of
nicotine levels in combustible cigarettes. We believe XXII has the opportunity to license its technology to Big Tobacco at
a fraction of the cost they are currently contemplating it will take to comply with potential FDA regulations and this could
result in a royalties or licensing stream far surpassing today’s market cap. While our price target is based on changes
in the US market we expect other countries to follow the FDA’s lead, opening up additional markets for XXII and higher
expected value for the shares.
Valuation:
Our twelve-month price target of $11.50 is based on the company garnering royalty revenue for its technology on 10%
of the US market share in the next five years, discounted at a 20% annual rate