All You Need to Know About a Company Before Investing
Is it Worth Investing?
The company is a forerunner in its area, having produced analytical platforms that have spanned the globe. It is an agricultural system for businesses to manage their everyday operation. Wade Barnes and Curtis Mackinnon developed it in 2005 in Manitoba, Canada.
The company delivers field-level research and predictive modelling offered by a recognized team of data analysts, with the ability to create value throughout the whole agricultural ecosystem. Users may review the status of soils, equipment functionality, crops, meteorological conditions and run statistics on an enterprise’s actions in real-time using the company’s FarmCommand platform.
Data is received from the following:
– Green Aero Tech (Drones)
– The Weather Company (Weather station)
– Landsat 8, Sentinel 2, Planet (Satellite imagery)
It went public in March 2021, with an initial public offering (IPO) priced at $20 per share. However, on November 19th, the stock was selling at $2.75 a share, with Canada’s Fairfax Financial Holdings (FFH) as the largest shareholder. A dip in the stock price shows the firm is heading in the wrong way, raising the issue of whether it’s still worth the investment.
The company has been a nightmare for shareholders owing to its poor management staff and FFH losing millions in recent times, despite enormous desire and potential inside a flourishing industry.
It has an obsession with burning cash that could save their assets in the future. So, it would be wise to think that chance of their success is insignificant. However, let us go further into the company’s difficulties, starting with a review of the company’s poor financial management:
Disappointing Financial Performance
FFH lost $10.5 million in 2017 and $32.7 million in 2018 while investing in FE. It paid $95 million for 43.5 per cent of the company in March 2017 and ended the year with a $10.5 million loss. If these losses were a foreshadowing of eventual fate, there would have already been a slew of warning lights around the company’s future.
The next year, FFH gave an additional $64 million in funding and recorded losses of $32.7 million. The FFH owns 50.4 per cent of the company, valued at $43.8 million, as of December 2019. Further losses, on the other hand, simply added to the company’s failing state.
the company is now unprofitable and does not appear to be on the verge of being profitable. It has to back up this claim. It has indicated that it cannot forecast whether it will become profitable in the next three years. It does not instill trust in potential investors.
Its cash flow is alarmingly high in comparison to its market worth, and the firm doesn’t seem to be in a position to handle its growth targets.
Its market capitalization plummeted in the months following its IPO, from $612.54 million in March to $115.2 million in November 2021. This precipitous drop would indicate that the corporation is now in severe circumstances.
Lack of Professionals in Top Positions
Wade Barnes, the CEO of the company, has promoted friends and family to senior positions. He hired his high school buddy Trevor Armitage as COO and his wife Marina Barnes as CMO. Regrettably, Marina’s inherent prejudices had affected business decisions, particularly when she supported entrance into the CIS and US markets despite no significant returns. One of the most significant anomalies stems from the firm’s Russian headquarters in Krasnodar, where Marina’s mother resides, rather than Moscow, where more economic prospects exist.
However, its Eastern European sector generates just around 2% of sales, and the company has lost 1.6 million acres in the region. FE currently claims that Marina Barnes has been the General Director of the firm’s Russian business since 2016, implying some inconsistencies.
When she met Wade, Marina Barnes was a translator and had no connection to Agtech. She’s now the CMO of a company that has been accused of bad management and employee harassment on many occasions.
“Upper management lives in a bubble.”
Four Top Managers Left The company in 2021
In a company with such a high rate of employee turnover in such prominent positions, it’s evident that there’s a lot of unhappiness from the top to down. Regardless of who is to blame for these actions, the fact that so many managers are departing is likely to have a trickle effect across the business, resulting in unfavourable outcomes. That’s only the tip of the iceberg; there’s a slew of more unfavourable consumer testimonies worth investigating.
What do Farmers Say?
If there was not already cause for concern, farmers also wrote critical reviews of the company, the very parties to which the business expects to contribute value.
If there was not already cause for concern, farmers also wrote critical reviews of it, the very parties to which the business expects to contribute value. The customers criticize how the company has low customer satisfaction. Their branding is not robust, especially in Canada. They have experience of shedding loads of money.
One customer mentioned that he tried it last year. But it didn’t work for him. After receiving their money, he seldom hears from them again. He was on the lower plan but, his neighbor did their floor sampling an RV program. They eventually employed the guys who would ordinarily do the soil sampling jobs in the first place because the farmers were not performing it. It seems like they are more concerned about getting bigger than servicing the acres they already have.
If negative reviews emanate from the customers’ perspective, there must be a serious question mark.
So, Should You Invest?
Many warning signs indicate the cause for concern, even though the firm is ambitious and wants to provide distinct value to farmers. The company appears to be an extremely hazardous investment that is ultimately not worth it, based on the reasons discussed throughout this article.