This morning Plant Health Care (LON:PHC) has released its results for the year to end December 2022 showing a 40% leap in sales to $11.8m while its pre-tax losses were steady at $4.6m.

The company has decided to evaluate over the coming weeks a range of financing options for the company, including how it might access non-dilutive and strategic capital to support its fast-expanding growth ambitions.

In reaction to that news the global agricultural markets biological products group’s shares have fallen 24% to 8.75p, which in my view now offers investors an immediate opportunity to jump aboard the future progress that this group will enjoy.

Food security continues to become a growing concern, with global events driving the world’s ever-increasing need for more access to vital crops. Sustainable agriculture lies at the heart of meeting this need, and this group’s biological products will play a fundamental role in providing better-quality crops that can deliver higher yields.

Farmers face many challenges, including the impacts of climate change, such as drought and the need to work more sustainably. Plant Health Care products provide an environmentally suitable solution to increase regular yields through our pipeline of products for farmers and food/crop suppliers across various markets.

Still in its early stages of development the company’s proprietary products, which are derived from natural proteins, help to protect crops from diseases and stress leading to increased crop yield, quality and financial return for growers globally.  

Its products

The rise to the top of the global agenda of climate change, food security and sustainability is driving increased demand for the company’s products.

In the last trading year the company recorded strong commercial sales growth of Harpinαβ – the recombinant protein which acts as a powerful bio-stimulant that is used to improve the quality, nutrient use, tolerance to abiotic stress and yield of crops. 

The group is gradually gaining success with its PREtec technology, with it its product Saori now launched for use in Brazil for the prevention and treatment of soybean diseases. 

Later this year the company is expecting to commercially launch its PHC279 and PHC949 products for use on major crops.

It is now expanding its global reach for its various products and working with major national distributors in doing so.

It is already well represented in North America, South America, Mexico and the EMEAA.

Analyst Opinion – Broker says Buy and ups Target Price to 37p

Analyst John-Marc Bunce at Cenkos Securities rates the group’s shares as a Buy, while upgrading his Target Price from 33p to 37p a share.

He estimates that the current year will see sales increase another 35% to $15.9m with the group’s losses almost at breakeven at just $0.3m negative.

For the year to end December 2024 Bunce goes for $22.0m revenues, $2.7m profits and earnings of 0.8c per share.

Looking into 2025 he predicts $30.1m turnover and a massive $8.4m profits, worth3.4c per share in earnings.

Conclusion – buy them now

On the basis of the group’s broker’s figures the shares, now 8.75p, appear to be a cracking ‘penny stock’ investment in a fast-developing global products company.

The FTSE 100 was outperforming European indices on Friday as a raft of encouraging updates from London-listed companies helped lift the index.

The FTSE 100 was 0.3% higher at the time of writing as the French CAC and Spanish IBEX traded in the red. The German DAX was marginally higher.

Positive updates from Prudential, Pearson and Smurfit Kappa took the stocks to the top of the FTSE 100 performance table and helped lift the overall index.

Poor US GDP data and talk of stagflation failed to take the wind out of UK equities and a strong start to the US session boosted stocks in afternoon trade.

Yesterday, US GDP came in lower than expected – but markets will be looking forward to next week’s Federal Reserve interest rate decision for the next major macroeconomic catalyst.

Inflation remains elevated and warrants further hikes. However, higher borrowing costs could put additional pressure on an economy showing signs of slowing.

NatWest

NatWest started Friday deep in the red after failing to increase guidance for the rest of 2023 and showed some signs of stress during banking turbulence in March. NatWest is the only FTSE 100 bank so far to reveal a fall in customer deposits since the start of the year.

“A drop in customer deposits, while nothing like on the scale seen at other crisis-ridden banks, has helped put the wind up investors in NatWest,” said AJ Bell investment director Russ Mould.

“The gap between the amount NatWest charges for loans compared to what it pays out for deposits, also known as the net interest margin, is also tighter than many had hoped.

“This runs counter to Barclays’ own first quarter numbers which showed higher base interest rates were feeding into a strong net interest margin.”

NatWest shares were down 3% at the time of writing but had been significantly lower earlier in the session. Barclays and Lloyds were both down around 1% in sympathy with NatWest’s drop. Lloyds are due to report next week.