Replies to post #199525 on $Pistol Pete$, $Mick$ & Friends Stock Picks /news,

[mick]

Castle Brands (ROX)
To be honest, I’m not completely sold on Castle Brands (NYSEAMERICAN:ROX) at its current price of 56 cents. And with ROX stock down 121% over the past year, it certainly seems like the market has determined the stock was trading at a premium to fair value. That said, there’s still some good news here, and it’s still an interesting play on U.S. spirits.

Castle’s Gosling brand creates both dark rum and ginger beer, which make the increasingly popular “Dark ‘N’ Stormy” drink. The Jefferson bourbon brand continues to grow nicely, with Castle’s whiskey portfolio (which includes smaller Irish offerings) growing revenue 20% in fiscal 2018.

Profits still are slim, but margins are increasing as revenue continues to grow. Management is well-incentivized to continue that growth. And the clear end game here is a sale to a larger spirits company like Diageo (NYSE:DEO) or Constellation Brands (NYSE:STZ, NYSE:STZ.B).

If ROX stays on its current trend, it should be able to eventually jumpstart a rally.