Alkame Holdings, Inc. (OTC PINK: ALKM) shares rallied after announcing that its wholly-owned subsidiary, West Coast Co-Packer Inc., received an initial purchase for Handout Protection hand sanitizer and wash combo single-use packets. The agreement was made through their Canadian Personal Protection Equipment (PPE) distributor, TheraProducts Canada, Inc., and ALKM believes this order will be the first of many.
Additional orders will undoubtedly create sustainable long-term shareholder value, and an expected surge in Handout Protection revenues also exposes value now. Better still, Handout Protection could be a best-in-class product and lead to its earning higher market share going forward. ALKM notes that Handout Protection is not only useful in killing known COVID-19 strains but also kills the new coronavirus variants that are known to spread 50% faster. As the product penetrates new markets, it could be a revenue-generating game-changer for ALKM.
In fact, because it is one of the few portable hand wash and sanitizer packets that allow people to wash and sanitize their entire hand, its marketability can be enormous. More specifically, Handout Protection enables users to clean not only their palms but also the tops and sides of the hands, including the fingers, under the nails, and up to the wrist to fight and kill bacteria and germs. It's a unique and valuable asset that targets an urgent need.
Best of all, Alkame expects that this initial purchase order will rapidly expand into additional purchases. If so, ALKM appears exceedingly undervalued at these levels. And some investors are seizing upon what they believe is a tremendous investment opportunity.
Packets Lead Surge In 2021, Other Products Follow
Investors are bidding shares higher, attacking a presumed disconnect between intrinsic value and the current stock price. They could be on point.
ALKM has several projects that are expected to create shareholder value in 2021. Thus, for a company with real products, multiple subsidiaries, and a history of achievement, sub-penny share prices may not reflect its present or future value.
Moreover, as ALKM creates value through a diversified plan of action, they also deliver multiple shots on goal. The company already offers health and wellness products, they have an aquaculture water treatment division, offer CBD co-packing services, and have plans in place to enter the billion-dollar pet health and wellness sector. Adding even more near-term firepower, ALKM is putting together alliances to penetrate the emerging industrial-use hemp markets. Thus, a sum of the parts analysis may expose a massive opportunity.
Moreover, if Alkame executes on monetizing its targeted initiatives, the returns in 2021 could be substantial.
Multiple Shots On Goal And Partnerships
Alkame Holdings certainly deserves a more appropriate forward-looking valuation from having multiple shots on goal that can drive near and long-term revenues. Alkame has provided a roadmap of how it plans to grow its operations.
As noted, one of its wholly-owned subsidiaries is already generating revenue from an initial purchase order for its premium gel-hand sanitizer. Those orders are expected to continue, especially in a massive PPE market where demand is far outpacing supply. The wholly-owned subsidiary, West Coast Co-Packer, Inc., is also ideally positioned to capitalize on its opportunities by being a specialty liquid and single-serve manufacturer, co-packer, private labeler, and contract packager. They are in growth mode.
Earlier this month, ALKM announced that West Coast Co-Packer, Inc. is working with Puration, Inc. (OTC Pink: PURA) to extend its services beyond being the bottler of EVERx CBD-infused Sports Water. The goal is to grow the partnership and bring the companies closer together to initiate multiple new CBD-infused consumer products. An update listing both companies was published earlier this month and highlighted plans for the two companies to produce and test market a CBD-infused liquid sugar and a CBD pet food supplement. Additional CBD-infused products, as well as hemp-derived beverages and edibles, are also in development.
And while those projects are potentially lucrative, ALKM could get even more attractive if federal laws governing the CBD, cannabis, and hemp sector get less restrictive. Investors believe changes being discussed could ignite a massive sector rally.
Biden Administration Expected To Lessen Federal Oversight
All eyes of those investing in the cannabis and CBD sector are on President Biden. Most are hopeful that he will lessen federal regulations that have put a stranglehold on parts of the cannabis and hemp markets. Speculation is that reform is relatively high on his agenda.
For ALKM and its partners, eased restrictions on utilizing hemp for industrial purposes could be a windfall. And they are well-positioned to capitalize on market demand. For those that don't know, hemp is an environmentally sustainable plant and is an alternative to more than $1 trillion in industrial products and services that currently damage the environment. Recognizing that value is important.
And with the Biden administration focused heavily on environmental issues, hemp fits nicely into the equation. For ALKM, its value could soar overnight on a favorable change since it has positioned itself to capitalize on opportunities inherent to Puration, Inc.'s (OTC: PURA) plans to develop a 70-acre parcel of land in Farmersville, Texas.
There, ALKM has a deal in place to leverage its logistics expertise to help Puration accelerate its hemp brand strategy. And since ALKM's services are a necessary ingredient to Puration's long-term plans, growth at Puration should translate into growth for ALKM.
Other partnerships bring value as well.
Two Other Agreements Can Drive Growth
Two other deals can accelerate near-term growth. First is an agreement with PAO Group, Inc. (OTC Pink: PAOG) to co-development and distribute PAOG's nutraceutical product line. That agreement can tap into PAO's growth as they expand their reach into the CBD and nutraceuticals markets. Like others, this deal can be immediately accretive to earnings since little to no capital outlay is required to advance the mission.
A second deal is with North American Cannabis Holdings, Inc. (OTC Pink: USMJ). There, ALKM is in a great position to create value by assisting USMJ to revitalize its investments in the cannabis and CBD space. USMJ is also taking advantage of market opportunities from the broadening interest in the cannabis sector. Growth there could benefit ALKM directly and facilitate the expansion of current agreements. That deal is in its developing stages.
Thus, with the current share price apparently not reflective of the active projects in play for ALKM, a potentially massive opportunity is being exposed. And for investors looking for undervalued companies in billion-dollar global markets, catching ALKM at these levels may be both timely and rewarding.
Bottom Line In 2021
ALKM is a value play in the works. And for investors with an investment time horizon extending 2-3 quarters down the road, this stock could deliver meaningful gains. Combining the value from its more than ten subsidiaries and its aggressive posture to invest in new ventures and opportunities, ALKM represents a growth play with multiple shots on goal. Moreover, at current prices, a massive long-term investment proposition is exposed.
Alkame Holdings is developing, and since the start of February, investors are likely positioning ahead of expected growth. And it's not a bad strategy. Moreover, with ALKM positioned to benefit from the success of at least three other publicly traded companies, additional value and revenue-generating opportunities could accrue in the coming months.
Thus, as a short-term trade or as a medium to long-term investment, ALKM is ripe for consideration.
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