BYND Cannasoft Enterprise (NASDAQ: BCAN) (CSE: BYND) stock may be trading lower, but don't be misled by the weakness. The microcaps have been getting badly bruised as interest rate hikes and inflation fears continue to weigh on emerging company stocks. That makes sense. But that doesn't mean that markets don't overshoot their targets, taking too much value from companies that have full pipelines of potential. That may be the case for BCAN, especially as this company continues to make inroads to monetizing key assets in a personal wellness sector often referred to as recession-proof.
Working to prove that thesis, BYND recently announced that after a year of intensive development of its EZ-G Device, monetization could be imminent. That has been the expectation since August, when BCAN shared updates relating to the production timeline and the printing of its EZ-G Device prototype. From then until its update last week, they have come a long way in transforming a milestone into a potential catalyst.
Considering its capabilities, capitalizing on that change appears to be a near-term proposition, perhaps better described as a value driver heading into the last quarter of 2023. According to BCAN, the sensual wellness product prototype is the first in its category by combining technical hardware elements such as peristaltic pumps, a heart rate sensor, a pressure sensor, and an EC sensor that work together to learn about the user's body. It does more. It has embedded within it a patent-pending system regulating the flow of low-concentration CBD oils from capsules through the device to the desired area of the user's body. That release isn't a pre-programmed response.
Utilizing AI-empowered Integrations
Instead, the device combines AI algorithms and machine learning processes from its sensors to collect user needs and preferences data to create a personalized experience. That data collected can be uploaded to the cloud, storing user preferences for future use, a differentiation that BCAN expects will allow the product to stand out in the women's wellness products community. BCAN management certainly thinks its EZ-G has that potential.
Yftah Ben Yaackov, CEO and Director of BYND Cannasoft, said in a company update on September 21st, "We are very proud of the fact that after a full year of our continuous efforts we are at the point where our idea has become a real prototype," He added, "This milestone is very important to us, and we hope to stay on track to the market launch in the second quarter of 2024. We believe that our device is unique and designed with the modern woman in mind to equip them with a cutting-edge device that offers a truly unique and personalized experience. We hope that its introduction to the women's health market will bring real positive change to the industry." He continued, "As we continue into the last few months of the year and collaborate with esteemed partners and institutions, we remain dedicated to our mission and are excited to share more progress announcements very soon."
In other words, BYND's hard work may be about to pay off. And at $0.65 on Friday, lower along with declines in the Russell Smallcap Index, the weakness may expose an opportunity. Investors should keep in mind when appraising BYND that it's more than a single-product company. This Israeli-based integrated software and CBD company also owns and markets "Benefit CRM," a proprietary customer relationship management (CRM) software product enabling small and medium-sized businesses to optimize their day-to-day business activities, including sales management, personnel management, marketing, call center activities, and asset management. And they are not newbies to the sector.
Leveraging Decades Of Experience In CRM
BCAN is leveraging over two decades of experience in CRM software, enabling them to expedite the development of an innovative new CRM platform to serve the needs of the medical CBD industry by making it more organized, accessible, and price-transparent.
Thus, at current prices, investors may get plenty more than what the share price represents. In fact, in the big picture, BYND is better positioned today than ever to exploit a niche market opportunity in the personal wellness products market. That's a multi-billion dollar market. But, more importantly, from an investor's perspective, they are doing so with AI-empowered technology, which in today's market is earning higher multiples. Combining those factors, the more appropriate method of appraising the BCAN value proposition is by factoring the sum of its parts. Doing so and accounting for recent milestones could be totaling to expose a valuation disconnect worthy of a growth stock investor's attention.
The bullish sentiment is warranted, noting BCAN's focus is on targeting niche market opportunities where others aren't. Better still, they are leveraging powerful proprietary AI-empowered technology, positioning them well to capitalize on revenue-generating potential from an expected $62.2 billion sensual wellness product sales opportunity by 2030. The opportunity could be more significant.
By maximizing value from its IP, BCAN could further monetize its portfolio to earn a larger slice of an AI-empowered sensual wellness market expected to surge globally to $1.5 trillion by 2030. That's a mission in progress. And it's one where, if BCAN can execute effectively, it could penetrate a wellness device market opportunity faster than expected, potentially becoming included in the massive percentage gains scored by other companies advancing proprietary AI-enhanced products and solutions, including Advanced Micro Devices (NASDAQ: AMD), NVIDIA (NASDAQ: NVDA), and Palantir (NASDAQ: PLTR). Clearly, those companies target different market opportunities. But the common thread driving their valuations higher is their advancing AI-empowered technology. BCAN believes it can leverage its IP portfolio and products to score similar gains.
The case for doing so is getting stronger, especially after factoring in the value inherent to BCAN's recently filed Patent Cooperation Treaty (PCT) application for their EZ-G, its game-changing device utilizing AI and sensors to provide a more satisfying user experience. A positive update on that application could unleash significant upside potential, noting it could be a first-to-market product in an emerging category. Remember, early movers are generally the best rewarded for supporting higher valuations. Modeling for higher BCAN prices would be no exception, especially with the AI-powered adult products market already presenting multi-billion dollar revenue potential and, as significantly, BCAN positioning itself as a leading sector player with IP-protected competitive advantages over later entrants.
Leveraging Milestones Reached In 2023
Combined, BCAN's sum of its parts supports a higher valuation. In fact, to appraise BCAN properly, investors need to factor in intrinsic and inherent value drivers that continue to strengthen. Moreover, BCAN is in a hot market and, significantly, is seizing its opportunities through product innovation and IP strength. Furthermore, the company has strengthened its balance sheet with a recent capital raise, an amount BCAN expects can usher its innovative products to market sooner rather than later.
If so, and the company has a record of delivering on its forecasts, BCAN could be a solid contributor to a growth stock portfolio. Considering they are targeting an over $9 billion direct product market opportunity with products whose differences are advantages, that bullish presumption is more than warranted; it's justified. Thus, in a stock market full of valuation disconnects, in this case, BCAN shares may present one too wide to ignore, making the potentially best course of action not to.
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