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Natural Health Trends Corp (NHTC) to begin trading on NASDAQ

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NHT Global’s Restor Vital energy supplement

  • NHTC will uplist to NASDAQ on Tuesday, February 17.
  • Also, the company should report an excellent Q4 in a few weeks.
  • NHTC appears poised for short-term price appreciation.

On February 12, Natural Health Trends Corp (OTCQB:NHTC) announced that it has been approved to begin trading on NASDAQ, starting Tuesday, February 17. In my November 6 update on Seeking Alpha, I highlighted the company’s initial announcement that it would seek a NASDAQ listing. (It has been trading on the OTCQB exchange.)

Many microcaps talk about uplisting, but those who actually make it happen are few. Congrats to NHTC management for doing what they said they would do.

Conventional wisdom says that companies which make the leap from the OTC to one of the major exchanges will see their stock appreciate. Since the February 12 confirmation of uplisting, NHTC stock has risen 11%. What happens once it actually begins trading on NASDAQ on Tuesday remains to be seen. I would expect that certain ETFs (such as a total NASDAQ tracker) would be forced to buy. NHTC should also appear on many more investors’ and institutions’ radars, and its financial metrics will stand out when it does so.

In further good news, on January 13, NHTC pre-released Q4 2014 revenue estimates of $35.4M. This will be the company’s third straight quarter topping $30M in sales. If Q4 EPS is $0.45 (a rough mid-point of the past two quarters), the TTM P/E will be 7.5, and the company will still have one more comp (Q1) which it should easily be able to improve upon: $23.2M / $0.26.

Downsides:

  • An insider recently sold a small part of his large stake, which caused me to sell my shares (see Point #6 in that post). I bought back in as soon as the NASDAQ confirmation news came out.
  • The company’s business model combines two things that scare most investors away: multi-level marketing and China (via Hong Kong). I covered these risks in my initial Seeking Alpha article on NHTC: Gargantuan Growth At 5X Run-Rate Earnings.

I’m looking forward to the start of NASDAQ trading on Tuesday. Monday is Presidents’ Day here in the US, so the markets are closed. The next trade in NHTC will occur on the NASDAQ exchange.

 

Disclosure: NHTC is $12.15 at the time of this writing and I am long.

Nat Hunt

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