Tuesday, 2 June 2020

MRS Set To Skyrocket After COVID Deal With Uber Or Lyft

We have been riding a win streak on the Canadian market recently with two of our last three picks doing extremely well. On May 19, we issued an alert on EastWest Bioscience Inc. (HBOSF) (EAST.V) when it was trading at $0.03 in a report titled "Canadian COVID Stocks Set To Double". On May 22, we issued an alert on Eyecarrot Innovations Corp. (EYCCF) (EYC.V) at $0.235. On May 28, EAST and EYC took the top two spots on the TSX Venture volume leaderboard with EAST hitting our target of more than a double and EYC just short of doubling. We are up to 888 followers on our ValueTrades blog despite not giving out a lot of alerts, a fact that we think is indicative of a successful, diligent and prudent stock picking history. If you like our picks you can also follow this blog by clicking the follow button on the top of the left hand panel. We have 18 followers so far on here. You can follow us on Twitter @StockTradePicks which has over 4,300 followers.












EAST made good as one half on the "Canadian COVID Stocks Set To Double". However, the second one, Mission Ready Solutions Inc. (MSNVF) (MRS.V) has so far fallen short of our initial $0.20 estimate. It has moved up marginally from $0.125 to $0.13 during that time but increased 18% in afternoon trading on Monday after excellent news that we think has been overlooked due to its release late in the day. We think this justifies a stock price well over $0.20 for MRS:

Mission Ready Teams up with Leading Transportation Company to Help Safeguard Drivers and Passengers
VANCOUVER, British Columbia, June 01, 2020 (GLOBE NEWSWIRE) -- Mission Ready Solutions Inc. (“Mission Ready” or the “Company”) (TSXV: MRS) is pleased to announce that is has signed a one-year Master Services Agreement, dated May 31, 2020, with a leading transportation company (“PartnerCo.”) based in San Francisco, California whereby the Company will manage the sale of personal protective equipment and cleaning supplies (“Goods”) to drivers (“the “Program”).
Beginning June 1, 2020, the Program – to be administered by Mission Ready – will initially be capable of accommodating a sizable percentage of current drivers (the “Initial Launch”) and scaled up expeditiously to meet anticipated driver demand (“Full-scale Rollout”). The Goods will be competitively priced at PartnerCo’s negotiated pricing with no additional PartnerCo markup. The Goods will be shipped directly to the drivers through Mission Ready’s distribution network. To start, a set selection of products will be available, including face masks (disposable and reusable) and disinfectants (sprays, packets and hand gels) – with additional products to be added based on driver demand and supplier availability. Mission Ready has confirmed its pricing and access to the Goods in quantities well exceeding the outside requirements for both the Initial Launch and Full-scale Rollout.
Orders placed through the Portal will be processed by Mission Ready through an integrated order processing solution, which provides a real-time connection between the Company’s extensive supplier network and its third-party logistics provider (3PL). Mission Ready’s existing systems will provide for a simple and convenient front-end experience for drivers, and an effective and efficient supply chain management process for the Company. After the successful Initial Launch, both parties expect to continue to expand Mission Ready’s shop to additional PartnerCo users.
PartnerCo has requested to remain anonymous during the Initial Launch. Should there be material business updates, Mission Ready will update the market in a timely manner. Though the Company is unable at this time to accurately predict or estimate the volume or timing of orders placed through the Portal following the June 1, 2020 launch, Mission Ready will provide further details on the Program as noteworthy developments occur, to include order volumes, process efficiencies, and new product offerings.
“We are thrilled to work alongside such a genuine and cohesive team of professionals who share a common passion – to strive for excellence and make a positive difference in the lives of those around them. When you’re talking about peoples’ health and wellbeing, there’s no room for error and we will continue to establish procedures to identify and proactively mitigate any potential challenges so that drivers receive the protection they need, when they need it,” states Jeffery Schwartz, Mission Ready’s President & CEO.
MRS teamed up with a "leading transportation company based in San Francisco". Uber Technologies, Inc. (UBER) and Lyft, Inc. (LYFT) make the most obvious choices as both have head offices in the Bay area. UBER has spent $50 million so far on PPE for its drivers and LYFT also has an active PPE program. So this agreement, though still in the initial launch phase, has the potential to be both a headline grabber and one that positively impacts the bottom line in a material fashion.

At $0.13, MRS has a market cap of just $25 million. This is just 1.0x revenue of a recent contract award with FEMA, which as we predicted, has now been followed up with multiple orders from different entities. The FEMA contract calls for $24 million to $36 million of personal protective equipment to be delivered by the end of September. MRS is also fulfilling $75 million worth of government contracts for protective military equipment this year.

The recent substantial increase to backlog with no sign of slowing down and agreements made to provide PPE to multiple large organizations during the pandemic is a perfect storm of speculative news and financial performance. With well over $100 million worth of contracts to be fulfilled for the rest of 2020, a stock price of $0.50 would still lead to a revenue multiple of just 1.0x. We expect a substantial rise in MRS' stock price like with what we have seen on EYC and EAST.

Disclosure: We are long MRS.V

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