Keep your eye on Nurosene Health, this portfolio manager says

Nurosene Health (Nurosene Health Stock Quote, Charts, News, Analysts, Financials CSE:MEND) should be on your investment radar, says Bruce Campbell of StoneCastle Investment Management. The microcap stock has been more or less floating along since its IPO on the Canadian Securities Exchange in June, but Campbell says Nurosene’s strong management team and subscription model approach to addressing mental health are enough to make the stock a Top Pick of his for the year ahead.

“They’re in the healthcare technology side of things focusing specifically on on brain health,” said Campbell, speaking on BNN Bloomberg on Friday. “Obviously, with the pandemic everyone’s focused more on wellness. We’ve known for years about physical fitness [and mental health] and now the mental impairment that probably all of us have a little bit of out from the pandemic is really becoming mainstream.”

“What Nurosene has done is they have an app and some technology tools where they use AI to develop a baseline for everyone so that they know exactly what your brain health and brain function is and then they have actionable items that you can monitor and take advantage of to improve your brain health all the time,” he said.

Along with the brain-exercises and other elements on its app, Nurosene has a line of wellness-based supplements. Part of a long-term trend towards patient-specific medicine, Nurosene’s platform aims to deliver products and programs that tailor to an individual’s needs.

“We’re collecting the data on how you interact with [the app’s] exercises and we can start predicting specific healthcare conditions you might be facing in the future and putting you on a pathway for some corrective action,” said Ranj Bath, CEO of Nurosene, speaking on cheddar.com in June.

The company has been busy over the past few months in assembling its board and executive and also in picking up a string of endorsements and partnerships. From NFL player Richard Sherman who in June came on as an investor to the NHL’s James van Riemsdyk who in September joined the company’s Mental Health Advisory Council to now pop star Nick Jonas who this month became an investor in Nurosene.

“I strongly believe that our mental health is paramount to our overall emotional and physical health. Nurosene is breaking down barriers and helping to destigmatize mental health, which is why I felt passionate about investing in a company that is prioritizing it and focused on bringing brain health solutions to more people around the world,” said Jonas in a press release.

As for its supplements and wellness products, Nurosene is also looking into sales opportunities through shops like WholeFoods, the Vitamin Shoppe, Walgreens and CVS, announcing a marketing and distribution partnership in June as well as the launch of its e-commerce platform with products Nuro Drive, a proprietary blend of PQQ and CoQ10, and Nuro Restore, designed to aid the body and brain in recovery and repair.

“Our supplements represent Nurosene’s unique approach to developing nutraceuticals designed to impact targeted functions that make for a healthier mind and body,” said Daniel Gallucci, Nurosene’s co-founder and chief innovation officer, in a June press release. “As we are coming out of the COVID-19 Pandemic, Nurosene anticipates an increased emphasis on mental wellness and overall well-being.”

Nurosene announced its fiscal third quarter financials in August for the quarter ended June 30, 2021, saying that it finished the quarter with cash of $8 million and working capital of $7.4 million, while in October the company closed on the acquisition of NetraMark for C$15 million. NetraMark is an AI-driven pharmatech company that offers data-driven solutions for optimizing clinical trials and drug development.

All told, Campbell says Nurosene should be one to watch, especially during this early stage where the stock is still under the radar.

“They’ve got a four-pronged approach as far as generating revenue goes,” Campbell said. “The first part of that is a direct-to-consumer model where it’s a subscription service, and we know what these things go for — if you look at, say, something like a Peloton that trades for 15x revenue, we know the potential for these subscription models in the fitness area.”

“Nurosene is one that’s not really well known right now, but we really think that it’s going to grow over the next year. They’ve got a management team that’s got really strong areas of expertise both in science and technology and then also in marketing. And they’ve had some really interesting partnerships with pro athletes where we think that mental [health] and enhancement of performance is great to optimize things,” he said.

“It’s one that we like and we think over the next few years it’s going to do really well and it’s really under undervalued and no one knows about it, so we think that there’s a lot of potential here,” Campbell said.