22nd Century Group Inc (XXII)

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Excerpt from Bradley Woods research report: Q4 Preview

22nd Century reports Q4 results on Thursday followed by an 8:00AM Eastern conference call. For the quarter we are estimating $6 million in revenue and an EBITDA loss of $3.9 million. We reiterate our Buy recommendation and $7 price target.

The two major catalysts for the shares are approval of the company’s MRTP application and the revivification of the low-nicotine mandate. We remain optimistic on both and expect the MRTP to be approved in the coming months, while the low-nicotine mandate may need approval of a new FDA commissioner. President Biden has yet to nominate an FDA commissioner and it will probably take 30 to 60 days after the nomination for approval. There could then be additional time spent as the new commissioner sets priorities. The low-nic goal is still alive, as indicated by Mitchell Zeller, Director of the FDA’s Center for Tobacco Products at the Tobacco and Nicotine Products Regulation and Policy Conference held in October 2020.