The stock is currently in a bearish trend and both indicators are negative. However, financials are improving YoY.

Overview

Woodbois Limited is an African based company with its head office located in Gabon. The company has offices in other geographical locations including London, Denmark, Mozambique, South Africa and Mauritius. Woodbois sustainably manage natural forest assets in Africa, trade and produce responsibly sourced hardwood products and restore tree cover for climate biodiversity. Two key areas of the business are its carbon project developments and wholesale of timber.

Financials

Looking at the company’s financials, H1 2022 revenue was up 38% to $11.3 millions vs H1 2021 of $8.2 million. The gross profit was up 59% in H1 2022 to $2.7 million vs $.17 million in H1 2021, margin improved to 23% from 20%. EBITDA H1 2022 was $1.1 million vs $0.46 million in H1 of 2021, up 141%. The company’s cash balance sits at $2.1 million as of June 30. 2022. Additionally, period end working capital of $9.8 million of which inventory was $6.4 million and excluding short and longer-term bank and other loans of $12.4 million. 

Technicals

From a technical perspective, the stock’s share price is currently trading at $2.75 and is heading in a negative (bearish) direction as both indicators are negative. MACD is currently negative and RSI reads 34. Support levels sit at $2.65 (upper green trendline) then at $2.35 then at $2.05 (lower green trendline). On the upside, resistance sits at $3.60 (lower red trendline) then at $4.05 then at $4.65 (upper red trendline). 

Summary

Based on the company’s financials, it is on track to deliver strong revenue and profitability growth in 2022. Some of the financial improvements from 2021 into 2022 have been significant and as a result, if they continue to see an uptrend in financials which will aid in the development of growth, the stock could float around its current price levels before seeing any positivity in the long-term. It may take some time, even up 3-5 years, before any major uptrend develops. And that is only if the business is striving upwards.