Why Smart For Life Stock Is Soaring

Smart for Life, Inc. SMFL shares are trading higher Wednesday after the company said it is negotiating the acquisition of four health and wellness targets as part of the company’s post-restructuring initiatives.

The Details:

According to a Benzinga Exclusive report, Smart for Life is seeking profitable companies in the nutraceutical industry with annual revenue between $5 million and $25 million. 

The company said it is negotiating the following acquisitions: 

• Purely Optimal Nutrition –  Smart for Life and Purely Optimal management are actively collaborating on restructuring sales initiatives to improve Purely Optimal’s profitability prior to closing the acquisition.
• Liquid Manufacturer – Contract manufacturer with sales of approximately $12 million and prior fiscal year profitability.
• Established Supplement Brand – Historical sales of approximately $10 million annually and profitable in nutraceutical products.
• Wholesale Manufacturer and Distributor – Generates approximately $8 million in revenue with profitability in retail channels.

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“We believe this pipeline represents a significant addition to our M&A initiatives,” stated Darren Minton, Smart for Life’s CEO. 

“While there is no assurance that any particular acquisition will be completed, we believe the growing acquisition pipeline creates an enormous prospective opportunity for the Company. We look forward to keeping everyone apprised of our developments as we continue to implement our strategy and drive toward our publicly stated goal of $100 million in revenue through both organic growth and M&A initiatives.”

Smart for Life shares are racing higher on heavy trading volume Wednesday as investors digest the acquisition announcement.  According to data from Benzinga Pro, more than 53 million shares have already been traded in the session, compared to the stock’s float of only 110,629 shares. 

How To Buy SMFL Stock:

Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.

For example, in Smart for Life's case, it is in the Consumer Staples sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.

SMFL Price Action: According to Benzinga Pro, Smart for Life shares are up 97.9% at $1.92 at the time of publication Wednesday.

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Image: Courtesy of Smart for Life, Inc.