What Field Trip’s Huge Financing Tells Investors

TM Editors Note: This article discusses one or more penny stocks and/or microcaps. Such stocks are readily manipulated; do your own careful due diligence.

In a rocky week for global markets – and psychedelic stocks – investors might have missed some big news.

Field Trip Health (CAN: FTRP / US: FTRPF) has announced a CAD$82.875 million bought deal financing. The placement was upsized from an original CAD$50 million offering.

This becomes the third-largest financing by a psychedelic drug public company. The offering is behind only Compass Pathway’s US$146 million IPO financing and MindMed Inc.’s CAD$92.1 million dollars bought deal.

With psychedelic drug stocks currently on sale, here are four important takeaways for investors from this announcement.

  1. Field Trip is now one of the industry leaders among public companies
  2. Institutions continue to have a nearly insatiable appetite for the psychedelic drug space
  3. Other psychedelics companies pursuing ketamine therapy are undervalued
  4. Most psychedelic stocks are undervalued

Field Trip is an industry leader among psychedelic drug public companies

It’s an obvious takeaway from Field Trip’s bought deal, but still worth noting.

Compass Pathways (US: CMPS) and MindMed Inc (CAN: MMED / US: MMEDF) had already established themselves as industry leaders among public companies in this space. But beyond that, no public company had clearly emerged in third place.

Field Trip has now separated itself from the rest of the pack. We can see this with the company’s new market cap.

FTRP traded as low as CAD$6.50 (the financing price) after the announcement. Let’s assume the share price stabilizes around CAD$7.

This isn’t unreasonable. Field Trip is a tightly held company with a small public float. It could even recover further toward its recent all-time high (CAD$9.89).

When we add the additional 12.75 million shares to the current 42.4 million, total shares issued and outstanding will rise to just over 55 million. That means an implied market cap for FTRP of ~$375 million.

At tits CAD$8.50 target price (in a recent analyst report by Stifel GMP), FTRP would have a market cap of over CAD$460 million.

Numinus Wellness (CAN: NUMI / US: LKYSF), the previous favorite to claim the #3 position, has a current market cap of ~CAD$250 million following the recent pullback in these stocks.

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Disclosure: The writer holds shares in MindMed Inc, Numinus Wellness, Cybin Inc, Novamind, and Mind Cure Health. Mind Cure Health is a client of Psychedelic Stock Watch.

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