Could Cellular Goods shares continue the rally to 5p?

The Cellular Goods share price was rocketed from lows 1.05p in mid-July to briefly trade above 3p in the last 24 hours. The surge in Cellular Goods shares follows a number of announcements around the marketing of their cannabinoid products and positive YouGoV poll results.

With the Cellular Goods IPO price at 5p, this is will be a natural short-term target for investors in the David Beckham-backed supplements and skin-care company.

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Whether shares can continue to the 5p level will depend largely depend on the traction of their marketing activities, and the resultant revenue from campaigns that utilised publishers such as Sheerlux, Evening Standard, Conde Nast and Hearst.

A survey by YouGov found 5.4% of 500 respondents were aware of Cellular Goods cannabis-based products, if this is extrapolated across the wider market, one may deduct the marketing campaigns are paying off.

“YouGov’s survey demonstrates how the marketing initiatives we implemented and budgeted for just a few months ago have taken Cellular Goods from being a virtually unknown brand to coming close to some much longer established names,” said Anna Chokina, Chief Executive of Cellular Goods following the release of the poll in July.

“Strong brand recognition is fundamental to delivering revenue growth and I am hugely encouraged our investment and strategy will enable the Company to achieve its long-term potential.”

However, this doesn’t directly infer any sales so we must take recent developments into account, these only being the dramatic share price increase since mid-July, and a 80% surge yesterday.

It’s common for a company to release an RNS noting any sharp share price movements, especially if they feel there isn’t any material changes in the company to warrant the movement, or there’s been media coverage they feel is slightly off the mark.

Such a release was absent from yesterday’s trading, suggesting management feels recent announcements justify the surging share price.

There has been a pull back today in a round of profit taking, which should be expected after such a notable rise in Cellular Goods shares.

The Cellular Goods website encourages visitors to ‘try the breakthrough Rejuvenating Cannabinoid Face Serum, proven to fight ‘inflammageing’, to keep skin youthful, smooth, and radiant.”

Investors will be closely watching future results for just how many people have done this, and to what extent.

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