Nepra Foods Inc.
InvestorSarfari Comments: We have been watching Nepra Foods since November of 2022. Although we have not added it to our official list of companies we cover (click here if you are interested to see the others) we were intrigued to see this article from the web that has an excellent recap and explanation to what’s been going on in the last little while. Personally, I have bought shares in Nepra Foods but am waiting for a few things to happen before we officially add it to our list and I believe that we are close. It would be a great benefit to read the article below! In the meantime we are waiting for the company to release more news on contracts as well as financial status. Keep your eyes glued!
Nepra Foods
Nepra Foods ( OTCMKTS: NPRFF - CSE: NPRA ) is a vertically integrated food company with an operating production facility just south of Denver, Colorado. Nepra was formed in 2016-2017 and was the union of 2-3 different projects.The CEO of Nepra, Chadwick White, created Udi’s Gluten Free bread in 2008. After building the Udi's from the ground up, he sold it in 2013 for 125 million dollars to Boulder Brands. Boulder Brands subsequently sold it to Con Agra Brands.
Udi’s Gluten Free Bread is still selling strong15 years later; it is one of the top three gluten free breads.
Chadwick has developed a new bread and licensed its production to a 3rd party bakery. It “will be initially distributed through KrogerTM, PublixTM, and MeijerTM representing over 2,600 retail locations across the country.”
(the news release is linked below)
For what it's worth, it seems like Chadwick is much more excited about the egg replacment than the bread.
In addition to the bread from the news release, hotdog buns, hamburger buns, rolls, cakes, cookies, a few different varieties of bread, and even tortillas are expected to follow shortly.
In the past 6 months, Nepra has produced and started selling a gluten free pasta. (ProPasta)
This pasta was recently awarded a gold medal by the American Masters of Taste panel, and it is being sold on the Nepra website, after lighting quick SKU acquisition by Chadwick White, who obviously knows the how to get things done quickly.
ProPasta has also been served at a high-caliber Denver restaurant for the past 3 months.
Virgillio's has posted multiple times about Nepra's pasta - and you can read user comments on their Facebook or Instagram.
Here are Virgilio's Pizza's credentials, it seems like they have an eye for quality. https://www.ilovepizzapie.com/media
This is an amazing situation for a company with a 2 million dollar market cap. A new gluten free bread about to be distributed nationally, and also what looks to be a very good pasta product.
According to the investor conference call and other communication with Chadwick, a much larger distribution deal for ProPasta is being worked on.
On top of that, Nepra is vertically integrated into their sector, and actually, the core of their business is not even selling gluten free bread or ProPasta – Nepra is an ingredient development and wholesale business. They sell flour and other baking products - specificly formulated and protected products - to a variety of companies.
Again - if creating and nationally selling a new gluten free bread doesn't make you think that maybe the company is undervalued with its 2 million dollar market cap, that's okay. That's not even the bulk of their business.
They currently supply many different companies - they are not at liberty to discuss all of their clients. One of the early ones, however, was Quinn Snacks, who is having great success with gluten free pretzels.
To validate the importance of this vertical integration, and the future size and potential profitability of the company, Nepra recently signed a contract with Scoular, the 47th largest private corporation in America.
If you haven’t heard of the 47th largest private corporation before, you are not alone. There are many private corporations in the United States that are almost completely unknown, outside of their own sector - I’m guessing you haven’t heard of half of the biggest 20 private corporations.…
This looks like a great deal with a huge company....
I first did a quick evaluation of the company in late 2022, and I didn't find much. The latest significant news release I could find was about the commercial production of an egg substitute.
This news release was no different than any other food venture company, or really, any other company that makes anything. EVERY company that wants to sell a product is going to say it is the best, game-changing, revolutionary thing in the world. While Chadwick does have some more credibility than others, I personally was not fully convinced that this wasn't some arm-waving promotion with no substance.
I got excited and I started buying a few months later (in early 2023) when they announced the new bread. (the news release with the “2,600 retail locations.")
So, if you read that news release carefully, it’s not just the egg replacement they are talking about, it’s the actual loaf of bread. Chadwick has created a new gluten free bread, and he has licensed a 3rd party bakery to sell it, while retaining all proprietary rights..... (It seems like he has been down this path before) Chadwick talks a little bit about this in an investor conference call, which is linked below.So,
1) the new gluten free bread being sold at “2,600 retail locations”
2) The ProPasta success at a "good" restaurant and winning a Gold Medal Award.
3) The manufacturing (and distribution) agreement with Scoular - on top of already having a fully operational production facility and distribution deals prior to this.
These are all very substantial news releases over the past few months, much better than when the company was valued higher in 2022.
But - the stock went down. Weird, huh?
Nepra has now spent 3-4 months in Wyckoff’s “accumulation phase,” and it looks like we just passed the spring. The distribution phase willl likely be amplified with the upcoming ProPasta announcement and updated financials, among other things.
Nepra's chart:
And here is a chart of a typical Wyckoff Accumulation Phase
For reference:
Wyckoff Accumulation: https://tradingcoach.co.in/richard-wyckoff-accumulation-distribution-phase/
Wyckoff Accumulation: https://stockcharts.com/articles/wyckoff/2015/06/accumulation-phase-absorbing-stock-like-a-sponge.html
If you get nothing else from this article, the accumulation phase is very interesting. Of course though, just because a stock is trading sideways like this, doesn't mean it's going to go up. lmao. Be careful. Losing money sucks.
My target price, right now, is at least 10 cents. Of course, new company agreements and/or financials would definitelly change this. Undoubtedly, I will take some off the table and hold the rest for much longer - because this is a good company. I have been known to take 1/2 off the table when a stock doubles in price and then ride out the free trading shares, and because of the positive outlook for this company, I think this would be an acceptable strategy for everyone. Trade - hold. These are not mutally exclusive.
Chadwick and other company leadership own a decent percentage of the company's shares, and we all know how important that is. Nepra has the shareholder's best interest in mind - because they have their own best interest in mind..... That's how this works, in case you don't know.
Oh – here’s his investor conference call - I'm pretty sure the dude works weekends, lol, he's pretty engaged and knowlegable about the company and industry. I like the part where he's talking about Udi's and says that by the time they would finish building a factory, it already wasn't big enough.
So, he has a lot of success and business knowledge. (besides being able to create products and get them through the regulatory hoops, bringing them to market) - Building factories, things like zoning permits, hiring and employee management, equipment aquisition and operation, sales, marketing, coporate taxes, payroll and employee taxes, insurance, OHSA and safety regulations, etc.
https://drive.google.com/file/u/0/d/1Ioc53HC5PsGJ9V4a9DQnXcXRi7O2nap5/view?usp=share_link&pli=1
Disclosure: I have not been paid for this article and I do not work for Nepra or any associated entity - In fact, I am soley umployed by the US Government, of all things. I do own Nepra shares, and I have been lucky enough to accumulate a decent position over the past few months.