Somebody once said you should make a bet every day because you might be walking around lucky and not know it. Every now and then, we come across a stock during our insider buying review that’s sort of like a bet. They are usually small companies without a lot of attention, sales or profits, trade for a buck or two per share, but have insider buying and some potential.
In a sense, we view them as options without an expiration date. Like calls or puts, shares can move violently in one direction or the other but don’t go to zero because time runs out, only if all the money and sales run out, but that’s not on a clock.
Jupiter Wellness, Inc. (JUPW) could be one of those walking-around companies but if things don’t go right, like a bad bet, you could lose it all. The stock trades at $1.68 as of this keystroke. The maximum downside for new shareholders at the current price is $1.68 per share. Now, in the last 52 weeks, JUPW has been as high as $8.88 per share. (1) Just because it hit triple eights, doesn’t mean Jupiter is destined to go there again, but it does give a sense of what potential upside might be.
Chief Executive Officer (CEO) Brian John appears to be betting on JUPW. On October 5, 2021, he purchased 51,556 shares at roughly $1.42 for a total investment of $73,023. (2) It’s not a lot of money by most insider buy standards, but more than most people of any means would be willing to throw away.
Standalone, we’d probably overlook a buy of less than six figures. However, the fact that John sold nearly $700k of Jupiter in July 2021 at $2.79 with the stock getting cut in half in the three months afterwards, provides some hope that the CEO has a feel for Jupiter’s value.
It also appears that the Chief Executive could be buying before a possible blitz of news. According to the company’s investor presentation, the cannabidiol (CBD) based medical therapeutics and wellness products maker has five indications in the pipeline. Each are in different phases of completion, but some could deliver news any day. Together, the total market for the handful of treatment is $23.8 billion, according to the investor document. (3)
The potential therapies are for eczema, actinic keratosis, burns, and herpes cold sores. Some of the competing products that are on the market now include Eucrisa, Zyclara, Silvadene, and Abreva.
Overview: Right now, Jupiter Wellness, Inc. (JUPW) is an emerging micro-cap with 12-month revenue of a little more than $1.1 million. (4). Based on its 52-week range and CEO Brian John’s buy, JUPW has an attractive reward to risk profile, in our opinion.
However, the company is operating at a loss and will be news release dependent. If JUPW’s pipeline receives good news and some of their therapies go to market, then Jupiter could be a good bet. On the other hand, bad news would be bad for the stock price, making it a bad bet.
Jupiter Wellness, Inc. (JUPW) is only appropriate for speculators who are willing to potentially lose all of their investment.
1 – https://finance.yahoo.com/quote/JUPW?p=JUPW
2 – https://www.secform4.com/insider-trading/1534699.htm
3 – https://jupiterwellness.com/wp-content/uploads/2021/08/Jupiter-Deck-August-2021-1.pdf
4 – https://finance.yahoo.com/quote/JUPW/financials?p=JUPW
