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The following discussion and analysis of the financial condition and results of
operations of Doma should be read together with the audited consolidated
financial statements as of December 31, 2021 and 2020 and for the years ended
December 31, 2021, 2020, and 2019 together with the related notes thereto,
contained in this Annual Report on Form 10-K (this "Annual Report").
Management's Discussion and Analysis of Financial Condition and Results of
Operations generally includes tables with 2 year financial performance,
accompanied by narrative for 2021. For further discussion of prior period
financial results, please refer to our Registration Statement on Form S-1 (No.
333-258942), as amended, filed with the SEC on September 3, 2021 and declared
effective on September 8, 2021. This discussion may contain forward-looking
statements based upon current expectations that involve risks and uncertainties
and should be read in conjunction with the disclosures and information contained
in "Cautionary Note Regarding Forward-Looking Statements" in this Annual Report.
Our actual results may differ materially from those projected in these
forward-looking statements as a result of various factors, including those set
forth under Part I, Item 1A "Risk Factors" or in other parts of this Annual
Report. Certain amounts may not foot due to rounding. All forward-looking
statements in this Annual Report are based on information available to us as of
the date hereof, and we assume no obligation to update any such forward-looking
statements to reflect future events or circumstances, except as required by law.

Unless the context otherwise requires, references to "company," "Company,"
"Doma," "we," "us," "our" and similar terms refer to Doma Holdings, Inc. (f/k/a
Capitol Investment Corp. V) and its consolidated subsidiaries. References to
"Capitol" refer to our predecessor company prior to the consummation of the
Business Combination. References to "Old Doma" refer to Old Doma prior to the
Business Combination and to States Title Holding, Inc. ("States Title"), the
wholly owned subsidiary of Doma, upon the consummation of the Business
Combination.

Our business model

Today, we primarily create, underwrite and provide title, escrow and
settlement services for the two most common types of transactions in the
residential real estate market: purchase and refinancing operations. We operate
and report on our activity through two complementary reporting segments,
Distribution and subscription. See “-Presentation Base” below.

Our Distribution segment reflects the sale of our products and services, other
than underwriting and insurance services reflected in our Underwriting segment,
that we provide through our captive title agents and agencies ("Direct Agents").
We market our products and services through two channels to appeal to our
referral partners and ultimately reach our customers, the individuals purchasing
a new home or refinancing their existing mortgage:

•Doma Enterprise - we target partnerships with national lenders and mortgage
originators that maintain centralized lending operations. Once a partnership has
been established, we integrate our Doma Intelligence platform with the partner's
production systems, to enable frictionless order origination and fulfillment.
Substantially all Doma Enterprise orders are underwritten by Doma.

•Local Markets ("Local") - we target partnerships with realtors, attorneys and
non-centralized loan originators via a 103-branch footprint across ten states as
of December 31, 2021. For the year ended December 31, 2021, approximately 90% of
our lender and owner policies from our Local channel were underwritten by Doma,
while the remaining share was underwritten by third-party underwriters.

Our Underwriting segment reflects the sale of our underwriting and insurance
services. These services are integrated with our Direct Agents channel and other
non-captive title and escrow agents in the market ("Third-Party Agents") through
our captive title insurance carrier. For customers sourced through the
Third-Party Agents channel, we retain a portion of the title premium
(approximately 16%) in exchange for underwriting risk to our balance sheet. The
Third-Party Agents channel includes the title underwriting and insurance
services we provide to Lennar, a related party, for its home builder
transactions.

The financial results of our Direct Agents channel impact both our Distribution
and Underwriting reporting segments, whereas the results from the Third-Party
Agents channel impact only the Underwriting reporting segment.

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Our expenses generally consist of direct fulfillment expenses related to closing
a transaction and insuring the risk, customer acquisition costs related to
acquiring new business, and other operating expenses as described below:

•Direct fulfillment expenses - comprised of direct labor and direct non-labor
expenses. Direct labor expenses refer to payroll costs associated with employees
who directly contribute to the opening and closing of an order. Some examples of
direct labor expenses include title and escrow services, closing services, and
customer service. Direct non-labor expenses refer to non-payroll expenses that
are closely linked with order volume, such as provision for claims, title
examination expense, office supplies, and premium and other related taxes.

•Customer acquisition costs - this category is comprised of sales payroll, sales
commissions, customer success payroll, sales-related travel and entertainment,
and an allocated portion of corporate marketing.

•Other operating expenses - all other expenses that do not directly contribute
to the fulfillment or acquisition of an order or policy are considered other
operating expenses. This category is predominately comprised of research and
development costs, corporate support expenses, occupancy, and other general and
administrative expenses.

We expect to continue to invest in our Doma Intelligence platform as well as
organic and inorganic growth opportunities in order to remain competitive with
existing large-scale industry incumbents who are well financed and have
significant resources to defend their existing market positions. Over time, we
plan to use our cash flows to invest in customer acquisition, research and
development, and new product offerings, to further improve revenue growth and
accelerate the elimination of the friction and expense of closing a residential
real estate transaction.

Basis of Presentation

We present the results of our two operating segments:

•Distribution - our Distribution segment reflects our Direct Agents operations
of acquiring customer orders and providing title and escrow services for real
estate closing transactions. We acquire customers through our Local and Doma
Enterprise customer referral channels.

•Underwriting - our Underwriting segment reflects the results of our title
insurance underwriting business, including policies referred through our Direct
Agents and Third-Party Agents channels. The referring agents retain
approximately 84% of the policy premiums in exchange for their services. The
retention rate varies by state and agent.

Costs are allocated to the segments to arrive at adjusted gross profit, our
segment measure of profit and loss. Our accounting policies for segments are the
same as those applied to our consolidated financial statements, except as
described below under "-Key Components of Revenues and Expenses." Inter-segment
revenues and expenses are eliminated in consolidation. See Note 7 in our
consolidated financial statements for a summary of our segment results and a
reconciliation between segment adjusted gross profit and our consolidated loss
before income taxes.

Important events and transactions

Business combination

On the Closing Date, Capitol consummated the Business Combination with Old Doma,
pursuant to the Agreement. In connection with the closing of the Business
Combination, Old Doma changed its name to States Title Holding, Inc., Capitol
changed its name to Doma Holdings, Inc. ("Doma") and Old Doma became a wholly
owned subsidiary of Doma. Doma continues the existing business operations of Old
Doma as a publicly traded company. Refer to Note 3 to the consolidated financial
statements for additional details on the Business Combination.

As a result of the Business Combination, we became the operating successor to an
SEC-registered and New York Stock Exchange-listed shell company. Becoming public
has required us to hire additional personnel and implement procedures and
processes to address public company regulatory requirements and practices. Also,
we

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have incurred additional annual expenses as a public company for, among other
things, directors' and officers' liability insurance, director fees, and
additional internal and external accounting, legal, and administrative
resources.

Impact of COVID-19 and other macroeconomic trends

On March 11, 2020, the World Health Organization declared COVID-19, the disease
caused by the novel coronavirus, a pandemic. COVID-19 has resulted in
significant macroeconomic impacts and market disruptions, particularly as
federal, state, and local governments enacted emergency measures intended to
combat the spread of the virus, including shelter-in-place orders, travel
limitations, quarantine periods and social distancing. In response, we took
appropriate measures to ensure the health and safety of our employees, customers
and partners, including work-from-home policies. Depending on the location and
timing, some of these measures still remain in place today.

We operate in the real estate industry and our business volumes are directly
impacted by market trends for mortgage refinancing transactions, existing real
estate purchase transactions, and new real estate purchase transactions,
particularly in the residential segment of the market. Responses to the COVID-19
pandemic initially led to a material decline in purchase transactions.
Subsequent U.S. federal stimulus measures, including interest rate reductions by
the Federal Reserve, and local regulatory initiatives, such as permitting remote
notarization, led to a quick recovery for the real estate industry and resulted
in an increase in mortgage refinancing and purchase volumes, which we believe
benefited our business model. These initiatives have also led to a greater
demand for homes, higher home prices, and record low home inventories. While
real estate transactions have largely returned to or exceeded pre-pandemic
levels, we continue to monitor economic and regulatory developments closely as
we navigate the volatility and uncertainty created by the pandemic.

Demand for mortgages tends to correlate closely with changes in interest rates,
meaning that our order trends are likely to be impacted by future changes in
interest rates. However, we believe that our current, low market share and
disruptive approach to title insurance, escrow, and closing services will enable
us to gain market share, which in turn should mitigate the risk to our revenue
growth trends relative to industry incumbents.

The acquisition of the North American title

At January 7, 2019we acquired from Lennar Corporation (“Lennar”) its
subsidiary company, North American Title Insurance Companywho used his title
insurance underwriting company and its third party title insurance agency
business, which operated under its North American Title Company brand
(collectively, the “Acquired Business”), for the aggregate of shares and deferred cash
consideration of $171.7 million (the “Acquisition of North American Securities”),
including $87.0 million in the form of a seller’s financing note.

The North American Title Acquisition provided us with insurance licenses and an
agency network across the United States, as well as a substantial data set to
accelerate our machine intelligence technology. This acquisition marked a
significant milestone for Doma in achieving national scale and licensure in
pursuit of our long-term growth strategy. Whereas we generated minimal revenue
prior to the North American Title Acquisition, following its consummation we
began to operate our business with a broad distribution footprint and data that
enabled us to accelerate the rollout of our Doma Intelligence platform. The
North American Title Acquisition also resulted in our recording of $111.5
million in goodwill and $61.4 million in acquired marketable securities.

Since the North American Title Acquisition, we have implemented several
initiatives to integrate and realign the operations of the Acquired Business.
This includes transforming the Acquired Business's retail agency operations by
streamlining our physical branch footprint, consolidating branch back office
functions into a common corporate operation, and implementing a common
production platform across all our branches. We continue to invest in the
development and rollout of the Doma Intelligence platform across our Local
branch footprint. We expect to realize significant cost savings over time as
manual processes are replaced with our proprietary machine learning platform and
data science-driven approach to title and closing services. The benefits of this
effort, particularly on margin growth, are likely to be realized gradually in
future reporting periods. As a result, our recent results of operations,
including for the years ended December 31, 2021, 2020, and 2019 may not be
indicative of our results for future periods.

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Key Operating and Financial Indicators

We regularly review several key operational and financial indicators to assess
our performance and trends and inform management budgets,
projections and strategic decisions.

The following table presents our key operating and financial indicators, as well
as the relevant generally accepted accounting principles ("GAAP") measures, for
the periods indicated:

                                                                         Year Ended
                                                                 2021                     2020
                                                          (in thousands, except for open and closed
                                                                       order numbers)
Key operating data:
Opened orders                                                    178,689                  136,873
Closed orders                                                    136,428                   92,389
GAAP financial data:
Revenue(1)                                               $       558,043            $     409,814
Gross profit(2)                                          $       103,261            $      85,830
Net loss                                                 $      (113,056)           $     (35,103)
Non-GAAP financial data(3):
Retained premiums and fees                               $       259,598            $     189,671
Adjusted gross profit                                    $       113,582            $      91,645
Ratio of adjusted gross profit to retained premiums and
fees                                                                  44    %                  48  %
Adjusted EBITDA                                          $       (71,592)           $     (18,986)


_________________

(1) Revenue includes (i) net premiums written, (ii) escrow, other
security and other costs, and (iii) investments, dividends and other income.
Net loss is made up of the revenue and expense components. For more
information about the measures included in our consolidated income statements,
see “-Key Components of Income and Expenses-Income” below.

(2)Gross profit, calculated in accordance with GAAP, is calculated as total
revenue, minus premiums retained by Third-Party Agents, direct labor expense
(including mainly personnel expense for certain employees involved in the direct
fulfillment of policies) and direct non-labor expense (including mainly title
examination expense, provision for claims, and depreciation and amortization).
In our consolidated income statements, depreciation and amortization is recorded
under the "other operating expenses" caption.

(3)Retained premiums and fees, adjusted gross profit and adjusted EBITDA are
non-GAAP financial measures. Refer to "-Non-GAAP Financial Measures" below for
additional information and reconciliations of these measures to the most closely
comparable GAAP financial measures.

Open and closed orders

Opened orders represent the number of orders placed for title insurance and/or
escrow services (which includes the disbursement of funds, signing of documents
and recording of the transaction with the county office) through our Direct
Agents, typically in connection with a home purchase or mortgage refinancing
transaction. An order may be opened upon an indication of interest in a specific
property from a customer and may be cancelled by the customer before or after
the signing of a purchase or loan agreement. Closed orders represent the number
of opened orders for title insurance and/or escrow services that were
successfully fulfilled in each period with the issuance of a title insurance
policy and/or provision of escrow services. Opened and closed orders do not
include orders or referrals for title insurance from our Third-Party Agents. For
avoidance of doubt, a closed order for a home purchase transaction typically
results in the issuance of two title insurance policies, whereas a refinance
transaction typically results in the issuance of one title insurance policy.

We review opened orders as a leading indicator of our Direct Agents revenue
pipeline and closed orders as a direct indicator of Direct Agents revenue for
the concurrent period, and believe these measures are useful to investors for
the same reasons. We believe that the relationship between opened and closed
orders will remain relatively consistent over time, and that opened order growth
is generally a reliable indicator of future financial performance. However,
degradation in the ratio of opened orders to closed orders may be a leading
indicator of adverse macroeconomic or real estate market trends.

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Retained premiums and fees

Retained premiums and fees, a non-GAAP financial measure, is defined as total
revenue under GAAP minus premiums retained by Third-Party Agents. See "-Non-GAAP
Financial Measures" below for a reconciliation of our retained premiums and fees
to gross profit, the most closely comparable GAAP measure, and additional
information about the limitations of our non-GAAP measures.

Our business strategy is focused on leveraging our Doma Intelligence platform to
provide an overall improved customer and referral partner experience and to
drive time and expense efficiencies principally in our Direct Agents channel. In
our Third-Party Agents channel in contrast, we provide our underwriting
expertise and balance sheet to insure the risk on policies referred by such
Third-Party Agents and, for that service, we typically receive approximately 16%
of the premium for the policy we underwrite. As such, we use retained premiums
and fees, which is net of the impact of premiums retained by Third-Party Agents,
as an important measure of the earning power of our business and our future
growth trends, and believe it is useful to investors for the same reasons.

Adjusted gross profit

Adjusted gross profit, a non-GAAP financial measure, is defined as gross profit
(loss) under GAAP, adjusted to exclude the impact of depreciation and
amortization. See "-Non-GAAP Financial Measures" below for a reconciliation of
our adjusted gross profit to gross profit, the most closely comparable GAAP
measure and additional information about the limitations of our non-GAAP
measures.

Management views adjusted gross profit as an important indicator of our
underlying profitability and efficiency. As we generate more business that is
serviced through our Doma Intelligence platform, we expect to reduce fulfillment
costs as our direct labor expense per order continues to decline, and we expect
the adjusted gross profit per transaction to grow faster than retained premiums
and fees per transaction over the long term.

Adjusted gross margin ratio on premiums and fees withheld

Ratio of adjusted gross profit to retained premiums and fees, a non-GAAP
measure, expressed as a percentage, is calculated by dividing adjusted gross
profit by retained premiums and fees. Both the numerator and denominator are net
of the impact of premiums retained by Third-Party Agents because that is a cost
related to our Underwriting segment over which we have limited control, as
Third-Party Agents customarily retain approximately 84% of the premiums related
to a title insurance policy referral pursuant to the terms of long-term
contracts.

We view the ratio of adjusted gross profit to retained premiums and fees as an
important indicator of our operating efficiency and the impact of our
machine-learning capabilities, and believe it is useful to investors for the
same reasons.

We expect improvement to our ratio of adjusted gross profit to retained premiums
and fees over the long term, reflecting the continued reduction in our average
fulfillment costs per order.

Adjusted EBITDA

Adjusted EBITDA, a non-GAAP financial measure, is defined as net income (loss)
before interest, income taxes and depreciation and amortization, and further
adjusted to exclude the impact of stock-based compensation, COVID-related
severance costs and the change in fair value of Warrant and Sponsor Covered
Shares liabilities. See "-Non-GAAP Financial Measures" below for a
reconciliation of our adjusted EBITDA to net loss, the most closely comparable
GAAP measure and additional information about the limitations of our non-GAAP
measures.

We look at Adjusted EBITDA as an important measure of our recurring revenue and
underlying financial performance, and we believe it is useful for investors to
same reason.

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Key Components of Revenues and Expenses

Revenue

Net premiums written

We generate net premiums by underwriting title insurance policies and recognize
premiums in full upon the closing of the underlying transaction. For some of our
Third-Party Agents, we also accrue premium revenue for title insurance policies
we estimate to have been issued in the current period but reported to us by the
Third-Party Agent in a subsequent period. See "-Critical Accounting Policies and
Estimates- Accrued net premiums written from Third-Party Agent referrals" below
for further explanation of this accrual. For the years ended 2021 and 2020, the
average time lag between the issuing of these policies by our Third-Party Agents
and the reporting of these policies or premiums to us has been approximately
three months. Net premiums written is inclusive of the portion of premiums
retained by Third-Party Agents, which is recorded as an expense, as described
below.

In order to reduce the risk associated with our insurance policies underwritten, we
use reinsurance programs to limit our maximum exposure to loss. under our
reinsurance treaties, we cede the premiums of the underlying policies
exchange for a ceding commission from the reinsurer and our net written premiums
exclude these ceded premiums.

Our principal reinsurance quota share agreement covers instantly underwritten
policies from refinance and home equity line of credit transactions under which
we historically ceded 100% of the written premium of each covered policy during
2019, 2020, and during the period from January 1, 2021 through February 23,
2021. Pursuant to a renewed agreement, which became effective on February 24,
2021, we cede only 25% of the written premium on such instantly underwritten
policies, up to a total reinsurance coverage limit of $80.0 million in premiums
reinsured, after which we retain 100% of the written premium on instantly
underwritten policies. This reduction in ceding percentage has resulted in
higher net premiums written per transaction when compared to prior period
results. Refer to Note 2 to the consolidated financial statements above for
additional details on our reinsurance treaties.

Escrow, other title fees and other

Escrow fees and other title-related fees are charged for managing the closing of
real estate transactions, including the processing of funds on behalf of the
transaction participants, gathering and recording the required closing
documents, providing notary services, and other real estate or title-related
activities. Other fees relate to various ancillary services we provide,
including fees for rendering a cashier's check, document preparation fees,
homeowner's association letter fees, inspection fees, lien letter fees and wire
fees. We also recognize ceding commissions received in connection with
reinsurance treaties, to the extent the amount of such ceding commissions
exceeds reinsurance-related costs.

This revenue item is most directly associated with our Distribution segment. For
segment-level reporting, agent premiums retained by our Distribution segment are
recorded as revenue under the "escrow, other title-related fees and other"
caption of our segment income statements, while our Underwriting segment records
a corresponding expense for insurance policies issued by us. The impact of these
internal transactions is eliminated upon consolidation.

Investments, dividends and other income

Investment, dividends and other income are mainly generated from our investment
portfolio. We primarily invest in fixed income securities, mainly composed of
corporate debt obligations, U.S. government agency obligations, certificates of
deposit, U.S. Treasuries and mortgage loans.

Expenses

Premiums retained by third-party agents

When customers are referred to us and we underwrite a policy, the referring
Third-Party Agent retains a significant portion of the premium, which typically
amounts to approximately 84% of the premium. The portion of premiums retained by
Third-Party Agents is recorded as an expense. These referral expenses relate
exclusively to

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our Underwriting segment. As we continue to grow our Direct Agents channel
relative to our Third-Party Agents channel, we expect that premiums retained by
Third-Party Agents will decline as a percentage of revenue over time.

For segment-level reporting, premiums retained by our Direct Agents (which are
recorded as Distribution segment revenue) are recorded as part of "premiums
retained by agents" expense for our Underwriting segment. The impact of these
internal transactions is eliminated upon consolidation.

Title examination fees

Title examination costs are incurred as part of the search and
review of public information prior to issuance of title insurance
Strategies.

Provision for claims

The provision for claims expenses is considered by management to be made up of three
components: IBNR reserves, known claims and claims adjustment expenses
escrow reserves and losses.

IBNR is a loss reserve that primarily reflects the sum of expected losses for
unreported claims. The expense is calculated by applying a rate (the loss
provision rate) to total title insurance premiums. The loss provision rate is
determined at the beginning of each year based in part upon an assessment
performed by an independent actuarial firm utilizing generally accepted
actuarial methods. The assessment also takes account of industry trends, the
regulatory environment and geographic considerations and is updated during the
year based on developments. This loss provision rate is set to provide for
losses on current year policies. Due to our long claim exposure, our provision
for claims periodically includes amounts of adverse or positive claims
development on policies issued in prior years, when claims on such policies are
higher or lower than initially expected.

Based on the risk profile of premium vintages over time and on the basis of
projections from a firm of independent actuaries, we build up or release reserves
related to our old policies. Our IBNR may increase in proportion to our
revenues as we continue to increase the proportion of our businesses served
through our Doma Intelligence platform, although we believe it will decrease over time
in the long term, because our predictive artificial intelligence technology produces
improved results.

Known claims loss and loss adjustment expense reserves is an expense that
reflects the best estimate of the remaining cost to resolve a claim, based on
the information available at the time. In practice, most claims do not settle
for the initial known claims provision; rather, as new information is developed
during the course of claims administration, the initial estimates are revised,
sometimes downward and sometimes upward. This additional development is provided
for in the actuarial projection of IBNR, but it is not allocable to specific
claims. Actual costs that are incurred in the claims administration are booked
to loss adjustment expense, which is primarily comprised of legal expenses
associated with investigating and settling a claim.

Escrow-related losses are primarily attributable to clerical errors that arise
during the escrow process and caused by the settlement agent. As the proportion
of our orders processed through our Doma Intelligence platform continues to
increase, we expect escrow-related losses to decline over time.

Personnel costs

Personnel costs include base salaries, benefits, bonuses paid to
employees and social charges. This expenditure is mainly due to the average
number of employees and our hiring activities during a given period.

In our presentation and reconciliation of segment results and our calculation of
gross profit, we classify personnel costs as either direct or indirect expenses,
reflecting the activities performed by each employee. Direct personnel costs
relate to employees whose job function is directly related to our fulfillment
activities, including underwriters, closing agents, escrow agents, funding
agents, and title and curative agents, and are included in the calculation of
our segment adjusted gross profit. Indirect personnel costs relate to employees
whose roles do not directly support our transaction fulfillment activities,
including sales agents, training specialists and customer success agents,
segment management, research and development and other information technology
personnel, and corporate support staff.

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Other operating expenses

Other operating expenses are comprised of occupancy, maintenance and utilities,
product taxes (for example, state taxes on premiums written), professional fees
(including legal, audit and other third-party consulting costs), software
licenses and sales tools, travel and entertainment costs, and depreciation and
amortization, among other costs.

Change in fair value of liabilities related to Warrants and Sponsors Covered Shares

Change in fair value of Warrant and Sponsor Covered Shares liabilities consists
of unrealized gains and losses as a result of recording our Warrants and Sponsor
Covered Shares to fair value at the end of each reporting period.

income tax expense

Although we are in a consolidated net loss position and report our federal
income taxes as a consolidated tax group, we incur state income taxes in certain
jurisdictions where we have profitable operations. Additionally, we incur
mandatory minimum state income taxes in certain jurisdictions. Also, we have
recognized deferred tax assets but have offset them with a full valuation
allowance, reflecting substantial uncertainty as to their recoverability in
future periods. Until we report at least three years of profitability, we may
not be able to realize the tax benefits of these deferred tax assets.

Operating results

We discuss our historical results of operations below, on a consolidated basis
and by segment. Past financial results are not indicative of future results. As
previously mentioned, our results of operations include tables with two years of
financial performance, accompanied by narrative for 2021 as compared to 2020.
For further discussion of prior period financial results, refer to our
Registration Statement on Form S-1 (No. 333-258942), as amended, filed with the
SEC on September 3, 2021 and declared effective on September 8, 2021.

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Contents
Year ended December 31, 2021 Compared to the year ended December 31, 2020

The following table presents a summary of our consolidated results of
transactions for the periods indicated and changes between periods.

                                                                   Year Ended December 31,
                                           2021                2020              $ Change               % Change
                                                             (in thousands, except percentages)
Revenues:
Net premiums written                   $  475,352          $  345,608          $  129,744                        38  %
Escrow, other title-related fees and
other                                      79,585              61,275              18,310                        30  %
Investment, dividend and other income       3,106               2,931                 175                         6  %
Total revenues                         $  558,043          $  409,814          $  148,229                        36  %

Expenses:

Premiums retained by Third-Party
Agents                                 $  298,445          $  220,143          $   78,302                        36  %
Title examination expense                  22,137              16,204               5,933                        37  %
Provision for claims                       21,335              15,337               5,998                        39  %
Personnel costs                           238,134             143,526              94,608                        66  %
Other operating expenses                   79,951              43,285              36,666                        85  %
Total operating expenses               $  660,002          $  438,495          $  221,507                        51  %
Loss from operations                     (101,959)            (28,681)            (73,278)                      255  %
Other (expense) income:
Change in fair value of Warrant and
Sponsor Covered Shares liabilities          6,691                   -               6,691                            *
Interest expense                          (16,861)             (5,579)            (11,282)                      202  %
Loss before income taxes                 (112,129)            (34,260)            (77,869)                      227  %
Income tax expense                     $     (927)         $     (843)         $      (84)                       10  %
Net loss                               $ (113,056)         $  (35,103)         $  (77,953)                      222  %

* = Not shown because previous period amount is zero

Income

Net premiums written. Net premiums written increased by $129.7 million, or 38%,
for the year ended December 31, 2021 compared to the same period in the prior
year, driven by a 46% increase in premiums from our Direct Agents channel and a
35% increase in premiums from our Third-Party Agents channel.

For the year ended December 31, 2021, Direct Agents premium growth was driven by
closed order growth of 48%. Closed order growth overall increased due to new
customer and referral partner acquisitions, increased wallet share with existing
referral partners, an expanding geographical footprint, and market conditions
resulting in the higher volume of refinance orders. Closed order growth was
offset by lower average premiums per Direct Agent order of 2%, due to a higher
share of refinance orders during the course of the year.

Third-Party Agent growth reflects the results of management's continued efforts
to increase wallet share capture from existing Third-Party Agents as well as
efforts to generate new agent relationships to accelerate growth. The rise in
premiums was also driven by an overall increase in market activity due to the
low interest rate environment.

Escrow, other title-related fees and other. Escrow, other title-related fees and
other increased $18.3 million, or 30%, for the year ended December 31, 2021
compared to the same period in the prior year, driven by the corresponding
closed order growth, offset by the higher mix of Doma Enterprise closed orders,
which carry a lower price point as compared to the Local channel.

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Investment, dividend and other income. Investment, dividend and other income
increased $0.2 million or 6% for the year ended December 31, 2021 compared to
the same period in the prior year, primarily due to one-time realized gains on
investments from portfolio rebalancing.

Expenses

Premiums Withheld by Third-Party Agents. Premiums withheld by third-party agents
increased by $78.3 millionor 36%, for the year ended December 31, 2021
compared to the same period of the previous year. The increase was drawn
mainly by the growth of written policies referred by third parties
Agents, and there has been no material change in the average commissions paid to our
Third Party Agents.

Title examination expense. Title examination expense increased by $5.9 million,
or 37%, for the year ended December 31, 2021 compared to the same periods in the
prior year, principally due to growth in Direct Agent closed orders and premiums
written.

Provision for claims. Provision for claims increased by $6.0 million, or 39%,
for the year ended December 31, 2021 compared to the same period in the prior
year primarily due to new business written premiums from the corresponding
periods. The provision for claims, expressed as a percentage of net premiums
written, was 4.5% and 4.4% for the year ended December 31, 2021 and 2020,
respectively. The reported loss emergence in both periods on policies issued in
prior years was lower than expected.

Personnel costs. Personnel costs increased by $94.6 million, or 66%, for the
year ended December 31, 2021 compared to the same period in the prior year, due
to investments in direct labor and customer acquisition, the expansion of our
corporate support functions to enhance public company readiness, and an increase
in operations and management staff supporting the direct agents channel as the
organization invests in driving growth of Doma Intelligence-enabled closings.

Other operating expenses. Other operating expenses increased by $36.7 million,
or 85%, for the year ended December 31, 2021 compared to the same period in the
prior year, driven by 116% higher corporate support expenses to operate as a
public company, higher operating expenses to support revenue growth such as
hardware and software purchases, higher amortization expenses related to
investments in the development of the Doma Intelligence platform, and higher
amortization of intangibles related to our rebranding to "Doma." Depreciation
and amortization increased by $4.5 million, or 77%, respectively, for the year
ended December 31, 2021 compared to the same period in the prior year.

Change in fair value of Warrant and Sponsor Covered Shares liabilities. The
change in the fair value of Warrant and Sponsor Covered Shares (as defined in
Note 2) liabilities increased by $6.7 million for the year ended December 31,
2021 compared to the same period in the prior year due to the addition of these
liabilities from the Business Combination in 2021.

Interest expense. Interest expense increased by $11.3 million, or 202%, for the
year ended December 31, 2021 compared to the same period in the prior year, due
to a higher amount of debt outstanding as well as a higher effective interest
rate in 2021, which is a result of the funding of the new $150.0 million Senior
Debt facility during the first quarter of 2021.

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Supplemental Segment Results Discussion - Year Ended December 31, 2021 Compared
to the Year Ended December 31, 2020

The following table sets forth a summary of the results of operations for our
Distribution and Underwriting segments for the years indicated. See "-Basis of
Presentation" above.

                                                         Year Ended December 31, 2021                                                          

Year ended December 31, 2020

                               Distribution           Underwriting           Eliminations           Consolidated           Distribution           Underwriting           Eliminations           Consolidated
                                                                                                              (in thousands)
Net premiums written         $           -          $     476,328          $        (976)         $     475,352          $           -          $     345,608          $           -          $     345,608
Escrow, other title-related
fees and other (1)                 177,069                  3,520               (101,004)                79,585                129,590                  2,099                (70,414)                61,275
Investment, dividend and
other income                           205                  2,901                      -                  3,106                    699                  2,232                      -                  2,931
Total revenue                $     177,274          $     482,749         

($101,980) $558,043 $130,289 $349,939 ($70,414) $409,814
Premiums withheld by agents
(2)

                                      -                400,425               (101,980)               298,445                      -                290,557                (70,414)               220,143
Direct labor (3)                    81,204                  8,412                      -                 89,616                 55,334                  6,820                      -                 62,154
Other direct costs (4)              23,726                 11,339                      -                 35,065                 16,912                  3,623                      -                 20,535
Provision for title claim
losses                               2,257                 19,078                      -                 21,335                  1,415                 13,922                      -                 15,337
Adjusted gross profit (5)    $      70,087          $      43,495          $           -          $     113,582          $      56,628          $      35,017          $           -          $      91,645



__________________

(1)Includes revenue from closing costs, escrow, title examinations, sales commission
income, as well as bonuses withheld by direct agents.

(2)This expense represents a deduction from the net premiums written for the
amounts that are retained by Direct Agents and Third-Party Agents as
compensation for their efforts to generate premium income for our Underwriting
segment. The impact of premiums retained by our Direct Agents and the expense
for reinsurance or co-insurance procured on Direct Agent sourced premiums are
eliminated in consolidation.

(3) Includes all compensation costs, including salaries, bonuses, incentives
payments and benefits for staff involved in the direct performance of
title and/or escrow services.

(4) Includes title examination fees, office supplies, bonuses and other
taxes.

(5)See “-Non-GAAP Financial Measures-Adjusted Gross Profit” below for a
reconciliation of consolidated adjusted gross margin, which is a non-GAAP
measure, to our gross profit, the most comparable GAAP financial results
measure.

Distribution segment revenue increased by $47.0 million, or 36%, for the year
ended December 31, 2021 compared to the same period in the prior year driven by
the closed order growth of 48% discussed above. Revenue from closed order growth
was somewhat offset by the higher mix of Doma Enterprise closed orders, which
carry a lower price point as compared to the Local channel. Underwriting segment
revenue increased by $132.8 million, or 38%, for the year ended December 31,
2021 compared to the same period in the prior year, reflecting significant
growth in title policies underwritten from both Direct and Third-Party Agents.

Distribution segment adjusted gross profit improved $13.5 million, or 24%, for
the year ended December 31, 2021 compared to the same period in the prior year,
driven principally by closed order growth offset by the higher mix of Doma
Enterprise closed orders, which carry a lower margin as compared to the Local
channel. Underwriting segment adjusted gross profit increased by $8.5 million,
or 24%, for the year ended December 31, 2021 compared to the same period in the
prior year, reflecting increased demand across all channels of the business
offset by increases in direct expenses.

Discussion of the results of the additional key operational and financial indicators – Year
Ended December 31, 2021 Compared to the year ended December 31, 2020

The following table presents our key operating and financial indicators,
including our non-GAAP financial measures, for the periods indicated, and the
changes between periods. This discussion should be read only as a supplement to
the discussion of our GAAP results above. See "-Non-GAAP Financial Measures"
below for important information about the non-GAAP financial measures presented
below and their reconciliation to the respective most closely comparable GAAP
measures.

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                                                                 Year Ended December 31,
                                         2021                 2020              $ Change               % Change
                                          (in thousands, except percentages and open and closed order numbers)
Opened orders                           178,689              136,873              41,816                        31  %
Closed orders                           136,428               92,389              44,039                        48  %
Retained premiums and fees          $   259,598           $  189,671          $   69,927                        37  %
Adjusted gross profit                   113,582               91,645              21,937                        24  %
Ratio of adjusted gross profit to
retained premiums and fees                   44   %               48  %             (4) p.p                     (8) %
Adjusted EBITDA                     $   (71,592)          $  (18,986)         $  (52,606)                      277  %


Opened and closed orders

For the year ended December 31, 2021, we opened 178,689 orders and closed
136,428 orders, an increase of 31% and 48%, respectively, over the same period
in the prior year. Closed orders increased 387% year over year in our Doma
Enterprise channel due to new customer and referral partner acquisitions,
increased wallet share with existing referral partners, and an expanded
geographical footprint. Closed orders decreased slightly by 1% in our Local
channel in the year ended December 31, 2021 compared to the same period in the
prior year due to the contracting refinance market that occurred during the
second half of 2021, which was partially offset by growth in purchase orders.

Premiums and fees withheld

Retained premiums and fees increased by $69.9 million, or 37%, for the year
ended December 31, 2021 compared to the same periods in the prior year, driven
by strong closed order and title policy growth across Direct and Third-Party
Agents, respectively.

Adjusted gross profit

Adjusted gross profit increased by $21.9 million, or 24%, for the year ended
December 31, 2021 compared to the same period in the prior year, due to growth
in retained premiums and fees of $69.9 million in the same period. The growth in
retained premiums and fees was partially offset by investments in fulfillment
infrastructure to support future growth.

Adjusted gross margin ratio on premiums and fees withheld

The ratio of adjusted gross profit to retained premiums and fees decreased 4
percentage points for the year ended December 31, 2021 compared to the same
period in the prior year due to the higher mix of Doma Enterprise closed orders,
which carry a lower price point as compared to the Local channel. Contributing
to the decrease in the ratio was higher direct labor expenses of $27.5 million,
or 44%, for the year ended December 31, 2021 compared to the same period in the
prior year. The rise in direct labor expenses exceeded retained premium and fees
growth as fulfillment labor was hired in advance of future volume growth, and
the organization experienced redundancies in fulfillment staff as it migrated
Local volume to Doma Intelligence.

Adjusted EBITDA

Adjusted EBITDA decreased by $52.6 million, or 277%, to negative $71.6 million
for the year ended December 31, 2021, driven by $74.6 million of higher
operating costs from investments in corporate support functions to successfully
operate as a public company, research and development, and operations and
management staff to support growth and the transformation of the Direct Agents
channel. This was offset by a $21.9 million improvement in adjusted gross
profit.

Non-GAAP Financial Measures

The non-GAAP financial measures described in this prospectus should be
considered only as supplements to the results prepared in accordance with GAAP and
should not be considered substitutes for GAAP results. these

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measures, retained premiums and fees, adjusted gross profit, and adjusted
EBITDA, have not been calculated in accordance with GAAP and are therefore not
necessarily indicative of our trends or profitability in accordance with GAAP.
These measures exclude or otherwise adjust for certain cost items that are
required by GAAP. Further, these measures may be defined and calculated
differently than similarly-titled measures reported by other companies, making
it difficult to compare our results with the results of other companies. We
caution investors against undue reliance on our non-GAAP financial measures as a
substitute for our results in accordance with GAAP.

Management uses these non-GAAP financial measures, in conjunction with GAAP
financial measures to: (i) monitor and evaluate the growth and performance of
our business operations; (ii) facilitate internal comparisons of the historical
operating performance of our business operations; (iii) facilitate external
comparisons of the results of our overall business to the historical operating
performance of other companies that may have different capital structures or
operating histories; (iv) review and assess the performance of our management
team and other employees; and (v) prepare budgets and evaluate strategic
planning decisions regarding future operating investments.

Premiums and fees withheld

The following presents our retained premiums and fees and reconciles the measure
to our gross profit, the most closely comparable GAAP financial measure, for the
periods indicated:

                                                Year Ended December 31,
                                                  2021               2020
                                                    (in thousands)
Revenue                                   $     558,043           $ 409,814
Minus:
Premiums retained by Third-Party Agents         298,445             220,143
Retained premiums and fees                $     259,598           $ 189,671

Less:

Direct labor                                     89,616              62,154
Provision for claims                             21,335              15,337
Depreciation and amortization                    10,321               5,815
Other direct costs(1)                            35,065              20,535
Gross Profit                              $     103,261           $  85,830


________________

(1) Includes title examination fees, office supplies, bonuses and other
taxes.

Adjusted gross profit

The following table reconciles our adjusted gross profit to our gross profit,
the most closely comparable GAAP financial measure, for the periods indicated:

                                       Year Ended December 31,
                                         2021                2020
                                           (in thousands)
Gross Profit                     $     103,261            $ 85,830
Adjusted for:
Depreciation and amortization           10,321               5,815
Adjusted Gross Profit            $     113,582            $ 91,645


Adjusted EBITDA

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The following table reconciles our adjusted EBITDA to our net loss, the most
closely comparable GAAP financial measure, for the periods indicated:

                                                                       Year Ended December 31,
                                                                      2021                    2020
                                                                            (in thousands)
Net loss (GAAP)                                                $    (113,056)            $   (35,103)
Adjusted for:
Depreciation and amortization                                         10,321                   5,815
Interest expense                                                      16,861                   5,579
Income taxes                                                             927                     843
EBITDA                                                         $     (84,947)            $   (22,866)
Adjusted for:
Stock-based compensation                                              20,046                   2,495
COVID-related severance costs                                              -                   1,385
Change in fair value of warrant and sponsor covered shares
liabilities                                                           (6,691)                      -
Adjusted EBITDA                                                $     (71,592)            $   (18,986)

Cash and capital resources

We measure liquidity in terms of our ability to fund the cash requirements of
our business operations, including our working capital and capital expenditure
needs and other commitments. Our recurring working capital requirements relate
mainly to our cash operating costs. Our capital expenditure requirements consist
mainly of software development related to our Doma Intelligence platform.

We had $383.8 million in cash and cash equivalents as of December 31, 2021. We
believe our operating cash flows, together with our cash on hand, and the cash
proceeds from the Business Combination and the related private placement, will
be sufficient to meet our working capital and capital expenditure requirements
for a period of at least 12 months from the date of this Annual Report.

We may need additional cash due to changing business conditions or other
developments, including unanticipated regulatory developments and competitive
pressures. To the extent that our current resources are insufficient to satisfy
our cash requirements, we may need to seek additional equity or debt financing.

Debt

Financing note from seller Lennar

As part of the North American Title Acquisition, Lennar issued us a note for
$87.0 million on January 7, 2019 with a maturity date of January 7, 2029. Cash
interest on the note accrued at one-month LIBOR plus a fixed rate of 8.5% per
annum on a "pay-in-kind" ("PIK") basis. Old Doma repaid the note in full in
January 2021, after making several principal prepayments in 2019 and 2020.

Senior Secured Credit Agreement

In December 2020, Old Doma entered into a loan and security agreement with
Hudson Structured Capital Management Ltd. ("HSCM"), providing for a $150.0
million senior secured term loan ("Senior Debt"), which was fully funded by the
lenders, which are affiliates of HSCM, at its principal face value on January
29, 2021 (the "Funding Date") and matures on the fifth anniversary of the
Funding Date. The Senior Debt bears interest at a rate of 11.25% per annum, of
which 5.0% is payable in cash in arrears and the remaining 6.25% accrues to the
outstanding principal balance on a PIK basis. Interest is payable or compounded,
as applicable, quarterly. Principal prepayments on the Senior Debt are
permitted, subject to a premium, which declines from 8% of principal today to 4%
in 2023 and to zero in 2024.

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The Senior Debt is secured by a first-priority pledge and security interest in
substantially all of the assets of our wholly owned subsidiary States Title
(which represents substantially all of our assets), including the assets of any
of its existing and future domestic subsidiaries (in each case, subject to
customary exclusions, including the exclusion of regulated insurance company
subsidiaries). The Senior Debt is subject to customary affirmative and negative
covenants, including limits on the incurrence of debt and restrictions on
acquisitions, sales of assets, dividends and certain restricted payments. The
Senior Debt is also subject to two financial maintenance covenants, related to
liquidity and revenues. The liquidity covenant requires States Title to have at
least $20.0 million of liquidity, calculated as of the last day of each month,
as the sum of (i) our unrestricted cash and cash equivalents and (ii) the
aggregate unused and available portion of any working capital or other revolving
credit facility. The revenue covenant, which is tested as of the last day of
each fiscal year, requires that States Title's consolidated GAAP revenue for the
year to be greater than $130.0 million. The Senior Debt is subject to customary
events of default and cure rights. As of December 31, 2021, States Title is in
compliance with all Senior Debt covenants.

Upon financing, Old Doma issued penny warrants to HSCM affiliates equivalent to
1.35% of the fully diluted shares of Old Doma. The warrants were exercised net on
Closing Date and such HSCM Affiliates have been granted the right to receive
approximately 4.2 million shares of our common stock.

Other commitments and contingencies

Our commitments for leases, related to our office space and equipment, amounted
to $37.8 million as of December 31, 2021 of which $9.4 million is payable in
2022. Refer to Note 15 to our consolidated financial statements for a summary of
our future commitments. Our headquarters lease expires in 2024. As of
December 31, 2021, we did not have any other material commitments for cash
expenditures. We also administer escrow deposits as a service to customers, a
substantial portion of which are held at third-party financial institutions.
Such deposits are not reflected on our balance sheet, but we could be
contingently liable for them under certain circumstances (for example, if we
dispose of escrowed assets). Such contingent liabilities have not materially
impacted our results of operations or financial condition to date and are not
expected to do so in the near term.

Cash flow

The following table summarizes our cash flows for the periods indicated:

                                                  Year Ended December 31,
                                                    2021                

2020

                                                      (in thousands)
Net cash used in operating activities       $     (56,329)           $ 

(9,274)

Net cash used in investing activities             (23,128)            

(63,033)

Net cash provided by financing activities         351,263              42,661


Operating Activities

In 2021, net cash used in operating activities was $56.3 million driven by the
net loss of $113.1 million, cash paid for prepaid expenses of $6.2 million and
non-cash costs relating to the change in the fair value of warrant and Sponsor
Covered Shares liabilities of $6.7 million. This was offset by increases of
accrued expenses and other liabilities of $17.7 million, increases of the
liability for loss and loss adjustment expenses of $10.5 million, non-cash
stock-based compensation expense of $19.7 million and non-cash depreciation and
amortization of $10.3 million.

In 2020, net cash used in operating activities was $9.3 million driven by the
net loss of $35.1 million and cash paid for prepaid expenses of $2.3 million.
This was offset by increases of accrued expenses and other liabilities of $5.1
million, increases of the liability for loss and loss adjustment expenses of
$7.0 million, non-cash paid in kind interest expense of $6.5 million and
non-cash depreciation and amortization of $5.8 million.

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Investing Activities

Our capital expenditures have historically consisted primarily of costs incurred in
the development of the Doma Intelligence platform. Our other investments
activities generally consist of transactions in investments with fixed maturities
securities to provide regular interest payments.

In 2021, net cash used in investing activities was $23.1 million, and reflected
$36.2 million of purchases of investments offset by $44.3 million of proceeds
from the sale of investments. Cash paid for fixed assets was $32.2 million in
the same period, largely consisting of technology development costs related to
the Doma Intelligence platform.

In 2020, net cash used in investing activities was $63.0 million and reflected
$66.4 million of purchases of investments offset by $18.8 million of proceeds
from the sale of investments. In the same period, cash paid for fixed assets was
$17.0 million, largely consisting of technology development costs related to
Doma Intelligence. We also received $1.6 million from the sale of a title plant
in the same period.

Financing Activities

Net cash provided by financing activities was $351.3 million in 2021, reflecting
$625.0 million in proceeds from the Business Combination and PIPE Investment (as
defined in Note 3) and $150.0 million of proceeds from the Senior Debt. This
increase was offset by $294.9 million in redemptions of redeemable common and
preferred stock and $66.0 million in payment of costs directly attributable to
the issuance of common stock in connection with Business Combination and PIPE
Investment. The net cash provided by financing activities was also offset by the
$65.5 million repayment of the Lennar seller financing note.

Net cash provided by financing activities was $42.7 million in 2020, reflecting
$70.7 million in proceeds from the issuance of Series C preferred stock, offset
by a $28.4 million payment on the Lennar seller financing note.

Significant Accounting Policies and Estimates

Our consolidated financial statements have been prepared in accordance with
GAAP. Preparation of the financial statements requires management to make
several judgments, estimates and assumptions relating to the reported amount of
revenue and expenses, assets and liabilities and the disclosure of contingent
assets and liabilities. We evaluate our significant estimates on an ongoing
basis, including, but not limited to, liability for loss and loss adjustment
expenses, goodwill and accrued net premiums written from Third-Party Agent
referrals, and the Sponsor Covered Shares liability. We consider an accounting
judgment, estimate or assumption to be critical when (1) the estimate or
assumption is complex in nature or requires a high degree of judgment and (2)
the use of different judgments, estimates and assumptions could have a material
impact on our consolidated financial statements. Our significant accounting
policies are described in Note 2 to our annual audited consolidated financial
statements. Our critical accounting estimates are described below.

Liability for claims and claim settlement expenses

Our liability for loss and loss adjustment expenses include mainly reserves for
known claims as well as reserves for IBNR claims. Each known claim is reserved
based on our estimate of the costs required to settle the claim.

IBNR is a loss reserve that primarily reflects the sum of expected losses for
unreported claims. The expense is calculated by applying a loss provision rate
to total title insurance premiums. With the assistance of a third-party
actuarial firm, we determine the loss provision rate for the policies written in
the current and prior years. This assessment considers factors such as
historical experience and other factors, including industry trends, claim loss
history, legal environment, geographic considerations and the types of title
insurance policies written (i.e., real estate purchase or refinancing
transactions). The loss provision rate is set to provide for losses on current
year policies, but due to development of prior years and our long claim
duration, it periodically includes amounts of estimated adverse or positive
development on prior years' policies. The provision rate on prior year policies
will continue to change as actual experience on those specific policy years
develop. As the Company's claims experience matures, we refine estimates on
prior policy years to put more consideration to the Company's actual claims
experience as compared to industry experience. Changes in the loss provision
rate for recent policy years are considered likely and could result

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in a material adjustment to the IBNR reserves. For example, a 50 basis point
increase or decrease in the current estimated 2021 loss provision rate would
result in a $2.8 million corresponding increase or decrease to IBNR.

The estimates used require considerable judgment and are established as
management's best estimate of future outcomes, however, the amount of IBNR
reserved based on these estimates could ultimately prove to be inadequate to
cover actual future claims experience. We continually monitor for any events
and/or circumstances that arise during the year which may indicate that the
assumptions used to record the provision for claims estimate requires
reassessment.

Our total loss reserve as of December 31, 2021 amounted to $80.3 million, which
we believe, based on historical claims experience and actuarial analyses, is
adequate to cover claim losses resulting from pending and future claims for
policies issued through December 31, 2021.

A summary of the Company’s provisions for losses is as follows:

                                  Year Ended December 31,
                                 2021                      2020
                                      ($ in thousands)
Known title claims    $     7,578           9  %    $  4,727      7  %
IBNR title claims          72,621          90  %      64,390     92  %
Total title claims    $    80,199          99  %    $ 69,117     99  %
Non-title claims               68           1  %         683      1  %
Total loss reserves   $    80,267         100  %    $ 69,800    100  %

We continually review and adjust our reserve estimates to reflect losses
experience and any new information that becomes available.

Good will

We have significant goodwill on our balance sheet related to acquisitions as
goodwill represents the excess of the acquisition price over the fair value of
net assets acquired and liabilities assumed in a business combination. Goodwill
is tested and reviewed annually for impairment on October 1 of each year, and
between annual tests if events or circumstances arise that would more likely
than not reduce the fair value of any one of our reporting units below its
respective carrying amount. In addition, an interim impairment test may be
completed upon a triggering event or when there is a reorganization of reporting
structure or disposal of all or a portion of a reporting unit. As of
December 31, 2021, we had $111.5 million of goodwill, relating to the North
American Title Acquisition, of which $88.1 million and $23.4 million was
allocated to our Distribution and Underwriting reporting units, respectively.

In performing our annual goodwill impairment test, we first perform a
qualitative assessment, which requires that we consider significant estimates
and assumptions regarding macroeconomic conditions, industry and market
considerations, cost factors, overall financial performance, changes in
management or key personnel, changes in strategy, changes in customers, changes
in the composition or carrying amount of a reporting unit or other factors that
have the potential to impact fair value. If, after assessing the totality of
events and circumstances, we determine that it is more likely than not that the
fair values of our reporting units are greater than the carrying amounts, then
the quantitative goodwill impairment test is not performed, as goodwill is not
considered to be impaired. However, if we determine that the fair value of a
reporting unit is more likely than not to be less than its carrying value, then
a quantitative assessment is performed. For the quantitative assessment, the
determination of estimated fair value of our reporting units requires us to make
assumptions about future discounted cash flows, including profit margins,
long-term forecasts, discount rates and terminal growth rates and, if possible,
a comparable market transaction model. If, based upon the quantitative
assessment, the reporting unit fair value is less than the carrying amount, a
goodwill impairment is recorded equal to the difference between the carrying
amount of the reporting unit's goodwill and its fair value, not to exceed the
carrying value of goodwill allocated to that reporting unit, and a corresponding
impairment loss is recorded in the consolidated statements of operations.

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We conducted our annual goodwill impairment test as of October 1, 2021. We
determined, after performing a qualitative review of each reporting unit, that
the fair value of each reporting unit exceeded its respective carrying value.
Accordingly, there was no indication of impairment and the quantitative goodwill
impairment test was not performed. We did not identify any events, changes in
circumstances, or triggering events since the performance of our annual goodwill
impairment test that would require us to perform an interim goodwill impairment
test during the year.

Accumulated net premiums issued from third party agent referrals

We recognize revenues on title insurance policies issued by Third-Party Agents
when notice of issuance is received from Third-Party Agents, which is generally
when cash payment is received. In addition, we estimate and accrue for revenues
on policies sold but not reported by Third-Party Agents as of the relevant
balance sheet closing date. This accrual is based on historical transactional
volume data for title insurance policies that have closed and were not reported
before the relevant balance sheet closing, as well as trends in our operations
and in the title and housing industries. There could be variability in the
amount of this accrual from period to period and amounts subsequently reported
to us by Third-Party Agents may differ from the estimated accrual recorded in
the preceding period. If the amount of revenue subsequently reported to us by
Third-Party Agents is higher or lower than our estimate, we record the
difference in revenue in the period in which it is reported. The time lag
between the closing of transactions by Third-Party Agents and the reporting of
policies, or premiums from policies issued by Third-Party Agents to us has been
approximately three months. In addition to the premium accrual, we also record
accruals for the corresponding direct expenses related to this revenue,
including premiums retained by Third-Party Agents, premium taxes, and provision
for claims.

Responsibility for actions covered by the sponsor

The Sponsor Covered Shares, as described in Note 3, will become vested
contingent upon the price of our common stock exceeding certain thresholds or
upon some strategic events, which include events that are not indexed to our
common stock.

We obtained a third-party valuation of the Sponsor Covered Shares as of July 28,
2021 (i.e., the Closing Date) and December 31, 2021 using the Monte Carlo
simulation methodology and based upon market inputs regarding stock price,
dividend yield, expected term, volatility and risk-free rate. The share price
represents the trading price as of each valuation date. The expected dividend
yield is zero as we have never declared or paid cash dividends and have no
current plans to do so during the expected term. The expected term represents
the vesting period, which is 9.6 years years. The expected volatility of 55.0%
was calculated based on the average of (i) the Doma implied volatility
calculated using longest term stock option. (ii) the Doma implied warrant
volatility using the term of the Public and Private Warrants and (iii) median
leverage adjusted (asset) volatility calculated using a set of Guideline Public
Companies ("GPCs"). Volatility for the GPCs was calculated over a lookback
period of 9.6 years years (or longest available data for GPCs whose trading
history was shorter than 9.6 years years), commensurate with the contractual
term of the Sponsor Covered Shares. The risk-free rate utilizes the 10-year U.S.
Constant Maturity. Finally, the annual change in control probability is
estimated to be 2.0%.

From December 31, 2021the liabilities of the actions covered by the sponsor amounted to $5.4
million
.

New accounting statements

For more information on recently published accounting pronouncements, refer to note 2
to our consolidated financial statements included elsewhere in this file.

Accounting Election for Emerging Growth Companies

Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the "JOBS
Act") exempts emerging growth companies from being required to comply with new
or revised financial accounting standards until private companies (that is,
those that have not had a Securities Act registration statement declared
effective or do not have a class of securities registered under the Exchange
Act) are required to comply with the new or revised financial accounting
standards. The JOBS Act provides that a company can elect to opt out of the
extended transition period

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  Table of     Contents
and comply with the requirements that apply to non-emerging growth companies but
any such election to opt out is irrevocable. The Company has elected not to opt
out of such extended transition period which means that when a standard is
issued or revised and it has different application dates for public or private
companies, the Company, as an emerging growth company, can adopt the new or
revised standard at the time private companies adopt the new or revised
standard. This may make comparison of the Company's financial statements with
another public company which is neither an emerging growth company nor an
emerging growth company which has opted out of using the extended transition
period difficult or impossible because of the potential differences in
accounting standards used.
]]>
CHEFS’ WAREHOUSE, INC. MANAGEMENT REPORT AND ANALYSIS OF FINANCIAL POSITION AND OPERATING RESULTS (Form 10-K) https://eventplaner.net/chefs-warehouse-inc-management-report-and-analysis-of-financial-position-and-operating-results-form-10-k/ Tue, 22 Feb 2022 15:16:06 +0000 https://eventplaner.net/chefs-warehouse-inc-management-report-and-analysis-of-financial-position-and-operating-results-form-10-k/
The following discussion should be read in conjunction with information included
in Item 8 of this report. Unless otherwise indicated, the terms "Company",
"Chefs' Warehouse", "we", "us", and "our" refer to The Chefs' Warehouse, Inc.
and its subsidiaries.

Overview and recent developments

Overview


We are a premier distributor of specialty foods in the leading culinary markets
in the United States. We offer more than 50,000 SKUs, ranging from high-quality
specialty foods and ingredients to basic ingredients and staples, produce and
center-of-the-plate proteins. We serve more than 35,000 core customer locations,
primarily located in our nineteen geographic markets across the United States
and Canada, and the majority of our customers are independent restaurants and
fine dining establishments. Our Allen Brothers subsidiary sells certain of our
center-of-the-plate products directly to consumers. We expanded our
direct-to-consumer product offerings in fiscal 2020 by launching our "Shop Like
a Chef" online home delivery platform in several of the markets we serve.

We believe several key differentiating factors of our business model have
enabled us to execute our strategy consistently and profitably across our
expanding customer base. These factors consist of a portfolio of distinctive and
hard-to-find specialty food products, an extensive selection of
center-of-the-plate proteins, a highly trained and motivated sales force, strong
sourcing capabilities, a fully integrated warehouse management system, a highly
sophisticated distribution and logistics platform and a focused, seasoned
management team.

In recent years, our sales to existing and new customers have increased through
the continued growth in demand for specialty food and center-of-the-plate
products in general; increased market share driven by our large percentage of
sophisticated and experienced sales professionals, our high-quality customer
service and our extensive breadth and depth of product offerings, including, as
a result of our acquisitions; the expansion of our existing distribution
centers; our entry into new distribution centers, including the construction of
new distribution centers in San Francisco, Toronto, Dallas, Los Angeles and
Miami; and the import and sale of our proprietary brands. Through these efforts,
we believe that we have been able to expand our customer base, enhance and
diversify our product selections, broaden our geographic penetration and
increase our market share.

Effect of the COVID-19 pandemic on our business and operations


The COVID-19 pandemic ("Pandemic") has had and continues to have an adverse
impact on numerous aspects of our business and those of our customers including,
but not limited to, demand for our products, cost inflation and labor shortages.
Despite these challenges, we continued to provide our core customers with high
touch service, executed on our cost control measures and returned to
profitability during the second quarter of fiscal 2021. Furthermore, as of
December 24, 2021, we had $157.8 million of working capital, including $115.2
million of cash and cash equivalents, on our balance sheet and $109.5 million of
availability on our asset-based loan facility. Our liquidity position, puts us
in a strategic position to invest in growth and take advantage of business
development opportunities as we continue to recover from the Pandemic.

The extent to which the Pandemic will impact our financial condition or results
of operations is uncertain and will depend on future developments including new
information that may emerge on the severity or transmissibility of the disease,
new variants, government responses, trends in infection rates, development and
distribution of effective medical treatments and vaccines, and future consumer
spending behavior, among others.

Recent significant acquisitions


On January 27, 2020, we entered into an asset purchase agreement to acquire
substantially all of the assets, including certain real-estate assets, of Sid
Wainer & Son ("Sid Wainer"), a specialty food and produce distributor in New
England. The cash purchase price was approximately $44.1 million, inclusive of a
$2.4 million working capital true-up. We are required to pay additional
contingent consideration, if earned, of up to $4.0 million over a two-year
period upon successful attainment of certain gross profit targets.

On February 3, 2020, we entered into an asset purchase agreement to acquire
substantially all of the assets of Cambridge Packing Co, Inc. ("Cambridge"), a
specialty center-of-the-plate producer and distributor in New England. The cash
purchase price was approximately $16.4 million, inclusive of a $0.6 million
working capital true-up. We are required to pay additional
                                       32
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contingent consideration, if won, of up to $3.0 million over a two-year period after achieving certain gross margin targets.


On February 25, 2019, pursuant to an asset purchase agreement, we acquired
substantially all of the assets of Bassian Farms, Inc. and related entities
("Bassian"), a specialty center-of-the-plate distributor based in northern
California. The aggregate purchase price for the transaction was approximately
$31.8 million, consisting of $28.0 million in cash paid at closing and the
issuance of a $4.0 million unsecured convertible note, partially offset by the
settlement of a net working capital true-up. We are also required to pay
additional contingent consideration, if earned, which could total $9.0 million
over a four-year period. The payment of the earn-out liability is subject to the
successful achievement of certain gross profit targets.

Trademark Transition


During the second quarter of fiscal 2021, we committed to a plan to shift our
brand strategy to leverage our Allen Brothers brand in our New England market
and determined our Cambridge trademark did not fit our long-term strategic
objectives. As a result, we recognized a $0.6 million impairment charge, $0.4
million net of tax, to fully write-down the net book value of our Cambridge
trademark.

During the fourth quarter of fiscal 2020, we committed to a plan to shift our
brand strategy to leverage our Allen Brothers brand in our west coast region and
determined that our Del Monte, Ports Seafood and Bassian Farms trademarks did
not fit our long-term strategic objectives. This brand transition began in the
second quarter of fiscal 2021. As a result, we recorded a $24.2 million
impairment charge, $17.5 million net of tax, to write-down the value of our Del
Monte and Bassian Farms trademarks.

Our growth strategies and outlook


We continue to invest in our people, facilities and technology in an effort to
achieve the following objectives and maintain our premier position within the
specialty foodservice distribution market:

• expansion of the sales and service territory; •operational excellence and high level of customer service; •expanded purchasing programs and improved purchasing power; •product innovation and the introduction of new product categories; •operational efficiency through system improvements; and •reduced operating costs by centralizing general and administrative functions.


Our growth has allowed us to improve upon our organization's infrastructure,
open new distribution facilities and pursue selective acquisitions. Over the
last several years, we have increased our distribution capacity to approximately
2.5 million square feet in 40 distribution facilities as of February 11, 2022.
From fiscal 2019 through the end of fiscal 2021, we have invested significantly
in acquisitions, infrastructure and management.

Key factors affecting our performance


Due to our focus on menu-driven independent restaurants, fine dining
establishments, country clubs, hotels, caterers, culinary schools, bakeries,
patisseries, chocolateries, cruise lines, casinos and specialty food stores, our
results of operations are materially impacted by the success of the
food-away-from-home industry in the United States and Canada, which is
materially impacted by general economic conditions, weather, discretionary
spending levels and consumer confidence. When economic conditions deteriorate,
our customers' businesses are negatively impacted as fewer people eat
away-from-home and those who do spend less money. As economic conditions begin
to improve, our customers' businesses historically have likewise improved, which
contributes to improvements in our business. Similarly, the direct-to-consumer
business of our Allen Brothers subsidiary is significantly dependent on
consumers' discretionary spending habits, and weakness or uncertainty in the
economy could lead to consumers buying less from Allen Brothers.

Volatile food costs may have a direct impact upon our profitability. Prolonged
periods of product cost inflation may have a negative impact on our profit
margins and results of operations to the extent we are unable to pass on all or
a portion of such product cost increases to our customers. In addition, product
cost inflation may negatively impact consumer discretionary spending decisions
within our customers' establishments, which could adversely impact our sales.
Conversely, our profit levels may be negatively impacted during periods of
product cost deflation even though our gross profit as a percentage of sales may
remain relatively constant. However, some of our products, particularly certain
of our center-of-the-plate protein items, are priced on a "cost plus" markup,
which helps mitigate the negative impact of deflation.

                                       33
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Given our wide selection of product categories, as well as the continuous
introduction of new products, we can experience shifts in product sales mix that
have an impact on net sales and gross profit margins. This mix shift is most
significantly impacted by the introduction of new categories of products in
markets that we have more recently entered, the shift in product mix resulting
from acquisitions, as well as the continued growth in item penetration on higher
velocity items such as dairy products.

The foodservice distribution industry is fragmented but consolidating, and we
have supplemented our internal growth through selective strategic acquisitions.
We believe that the consolidation trends in the foodservice distribution
industry will continue to present acquisition opportunities for us, which may
allow us to grow our business at a faster pace than we would otherwise be able
to grow the business organically.

Performance indicators

In addition to evaluating our operating profit, our management team analyzes our performance based on growth in net sales, gross profit and gross profit margin.


•Net sales growth. Our net sales growth is driven principally by changes in
volume and, to a lesser degree, changes in price related to the impact of
inflation in commodity prices and product mix. In particular, product cost
inflation and deflation impacts our results of operations and, depending on the
amount of inflation or deflation, such impact may be material. For example,
inflation may increase the dollar value of our sales, and deflation may cause
the dollar value of our sales to fall despite our unit sales remaining constant
or growing.
•Gross profit and gross profit margin. Our gross profit and gross profit as a
percentage of net sales, or gross profit margin, are driven principally by
changes in volume and fluctuations in food and commodity prices and our ability
to pass on any price increases to our customers in an inflationary environment
and maintain or increase gross profit margin when our costs decline. Our gross
profit margin is also a function of the product mix of our net sales in any
period. Given our wide selection of product categories, as well as the
continuous introduction of new products, we can experience shifts in product
sales mix that have an impact on net sales and gross profit margins. This mix
shift is most significantly impacted by the introduction of new categories of
products in markets that we have more recently entered, impact of product mix
from acquisitions, as well as the continued growth in item penetration on higher
velocity items such as dairy products.

Key financial definitions


•Net sales: Net sales consist primarily of sales of specialty products, produce,
center-of-the-plate proteins and other food products to independently-owned
restaurants and other high-end foodservice customers, which we report net of
certain group discounts and customer sales incentives. Net sales also include
direct-to-consumer sales on our e-commerce platforms.
•Cost of sales: Cost of sales include the net purchase price paid for products
sold, plus the cost of transportation necessary to bring the product to our
distribution facilities and food processing costs. Food processing costs
include, but are not limited, to direct labor and benefits, applicable overhead
and depreciation of equipment and facilities used in food processing activities.
Our cost of sales may not be comparable to other similar companies within our
industry.
•Selling, general and administrative expenses: Selling, general and
administrative expenses include facilities costs, product shipping and handling
costs, warehouse costs, and other selling, general and administrative costs.
•Other operating expenses: Other operating expenses includes expenses primarily
related to changes in the fair value of the Company's earn-out liabilities,
gains and losses on asset disposals, asset impairments and certain third-party
deal costs incurred in connection with business acquisitions or financing
arrangements.
•Interest expense: Interest and other expense consists primarily of interest on
our outstanding indebtedness and, as applicable, the amortization or write-off
of deferred financing fees.











                                       34
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Results of Operations

                                                                          Fiscal Years Ended
                                               December 24, 2021           December 25, 2020           December 27, 2019
Net sales                                    $        1,745,757          $        1,111,631          $        1,591,834
Cost of sales                                         1,355,272                     863,480                   1,205,266
Gross profit                                            390,485                     248,151                     386,568
Selling, general and administrative expenses            379,252                     336,394                     329,542
Other operating expenses                                    422                      14,417                       6,359
Operating income (loss)                                  10,811                    (102,660)                     50,667
Interest and other expense, net                          17,587                      20,946                      18,264

(Loss) income before income taxes                        (6,776)                   (123,606)                     32,403
Provision for income tax (benefit) expense               (1,853)                    (40,703)                      8,210
Net (loss) income                            $           (4,923)         $          (82,903)         $           24,193



Fiscal Year Ended December 24, 2021 Compared to Fiscal Year Ended December 25,
2020

Net Sales

                                2021             2020          $ Change       % Change
                Net sales   $ 1,745,757      $ 1,111,631      $ 634,126         57.0  %



Organic growth contributed $574.2 million, or 51.6%, to sales growth in the year
primarily driven by our recovery from the Pandemic. The remaining growth of
$59.9 million, or 5.4%, resulted from acquisitions. Organic case count increased
approximately 33.8% in our specialty category. In addition, specialty unique
customers and placements increased 26.1% and 31.6%, respectively, compared to
the prior year. Pounds sold in our center-of-the-plate category
increased 28.2% compared to the prior year. Estimated inflation was 9.6% in our
specialty category and 18.1% in our center-of-the-plate category compared to
fiscal 2020.

Gross Profit

                                       2021            2020         $ Change       % Change
           Gross profit            $ 390,485       $ 248,151       $ 142,334         57.4  %
           Gross profit margin          22.4  %         22.3  %



Gross profit increased primarily due to increased sales volumes. Gross profit
margin increased approximately 4 basis points. Gross profit
margins increased 379 basis points in the Company's specialty category
and decreased 350 basis points in the Company's center-of-the-plate category
compared to the prior year period. Our prior year gross profit results include a
charge of approximately $14.6 million related to estimated inventory losses from
obsolescence due to the Pandemic's impact on our customers' purchasing behavior.

Selling, general and administrative expenses


                                                       2021                     2020                  $ Change               % Change
Selling, general and administrative expenses            379,252                  336,394               42,858                      12.7  %
Percentage of net sales                                    21.7  %                  30.3  %



The increase in selling, general and administrative expense relates primarily to
increased sales volumes and acquisitions. Our prior year results include an
estimated non-cash charge of approximately $15.8 million to bad debt expense
incurred during the first quarter of fiscal 2020 at the onset of the Pandemic.
Our ratio of selling, general and administrative expenses to net sales was lower
as a result of sales growth.




                                       35
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Other operating expenses, net

                                        2021        2020         $ Change        % Change
            Other operating expenses    422        14,417       (13,995)          (97.1) %



The decrease in net other operating expenses relates primarily to a $24.2
million impairment charge for Del Monte and Bassian trademarks as a result of a
shift in brand strategy to leverage our Allen Brothers brand in our west coast
region during the fourth quarter of fiscal 2020 and non-cash credits of $1.3
million for changes in the fair value of our contingent earn-out liabilities in
the fiscal 2021 period compared to non-cash credits of $11.5 million in the
prior year period.

Interest Expense

                                       2021          2020        $ Change      % Change
               Interest expense       17,587        20,946      $ (3,359)       (16.0) %



Interest expense decreased primarily due to $1.2 million in one-time third-party
costs incurred during the second quarter of 2020 in connection with the
extension of a majority of our senior secured term loans and lower effective
interest rates charged on our outstanding debt as a result of the $50.0 million
aggregate principal amount of Convertible Senior Notes issued on March 1, 2021
which were used to repay higher interest rate debt.

Provision for tax benefit


                                              2021          2020         $ 

Change % Change

Provision for tax benefit (1,853) (40,703) $38,850 (95.4)%

       Effective tax rate                     27.3  %        32.9  %



The higher effective tax rate in the prior period is primarily related to the
carryback of a portion of our fiscal 2020 net taxable loss which allowed us to
claim tax refunds against taxes paid in fiscal 2015 and 2017, both of which were
at statutory tax rates of 35%.

Fiscal Year Ended December 25, 2020 Compared to Fiscal Year Ended December 27,
2019

Net Sales

                               2020             2019           $ Change       % Change
               Net sales   $ 1,111,631      $ 1,591,834      $ (480,203)       (30.2) %



Sales growth from acquisitions contributed $136.5 million, or 8.6%, to sales
growth. Organic sales declined $616.7 million, or 38.8%, versus the prior year
primarily due to impacts of the Pandemic. Organic case count declined
approximately 43.5% in our specialty category. In addition, specialty unique
customers and placements declined 30.4% and 43.6%, respectively, compared to the
prior year. Pounds sold in our center-of-the-plate category decreased 38.0%
compared to the prior year. Estimated deflation was 0.3% in our specialty
category and inflation of 3.5% in our center-of-the-plate category compared to
fiscal 2019.

Gross Profit

                                      2020           2019          $ Change       % Change
           Gross profit             248,151        386,568       $ (138,417)       (35.8) %
           Gross profit margin         22.3  %        24.3  %



Gross profit decreased primarily due to decreased sales volumes. Gross profit
margin decreased approximately 196 basis points. Gross profit margins decreased
441 basis points in the Company's specialty category and increased 117 basis
points in the Company's center-of-the-plate category compared to the prior year
period. Our gross profit results include a charge of approximately $14.6 million
related to estimated inventory losses from obsolescence due to the Pandemic's
impact on our customers' purchasing behavior.


                                       36
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Selling, general and administrative expenses


                                                       2020                     2019                 $ Change               % Change
Selling, general and administrative expenses            336,394                  329,542               6,852                       2.1  %
Percentage of net sales                                    30.3  %                  20.7  %



The increase in selling, general and administrative expense relates primarily to
our recent acquisitions and an estimated non-cash charge of approximately $15.8
million to bad debt expense incurred during the first quarter of fiscal 2020 at
the onset of the Pandemic, partially offset by cost measures implemented during
the year in response to the Pandemic's adverse impact on demand for our
products. Our ratio of selling, general and administrative expenses to net sales
was higher as a result of the Pandemic's adverse impacts on our sales growth and
a 161 basis point increase in non-cash charges related to bad debt expense.

Other operating expenses, net

                                          2020         2019       $ Change       % Change
            Other operating expenses     14,417       6,359       8,058           126.7  %



The increase in other operating expenses relates primarily to a $24.2 million
impairment charge on Del Monte and Bassian trademarks and non-cash credits of
$11.5 million for changes in the fair value of our contingent earn-out
liabilities compared to non-cash charges of $5.9 million in the prior year
period.

Interest Expense

                                       2020          2019        $ Change      % Change
               Interest expense       20,946        18,264      $  2,682         14.7  %



Interest and other expense increased primarily due to $1.2 million in one-time
third-party costs incurred during the second quarter of 2020 in connection with
the extension of a majority of our senior secured term loans and the full year
impact of interest charged on our Convertible Senior Notes issued on November
22, 2019.

Provision for income tax (benefits)


                                                  2020          2019        

$ Change % Change

  Provision for income tax (benefit) expense    (40,703)       8,210       $ (48,913)      (595.8) %
  Effective tax rate                               32.9  %      25.3  %



The higher effective tax rate is primarily related to our net taxable loss for
fiscal 2020 which allows us to claim tax refunds against taxes paid in fiscal
2015 and 2017, both of which were at statutory tax rates of 35%.

Cash and capital resources

We fund our ongoing operations and growth primarily through operating cash flow, borrowings under our senior secured credit facilities and other indebtedness, operating leases, trade and equity financing.

Debt


The following table presents selected financial information on our indebtedness
(in thousands):

                                            December 24, 2021           December 25, 2020           December 27, 2019
Senior secured term loan                  $          168,675          $          201,553          $          238,129
Total convertible debt                    $          204,000          $          154,000          $          154,000
Borrowings outstanding on asset-based
loan facility                             $           20,000          $           40,000          $                -
Finance leases and other financing
obligations                               $           11,602          $           15,798          $            3,905



                                       37
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As of December 24, 2021, we have various floating- and fixed-rate debt
instruments with varying maturities for an aggregate principal amount of $392.7
million. See Note 9 "Debt Obligations" to our consolidated financial statements
for a full description of our debt instruments.

On March 1, 2021, the we issued $50.0 million aggregate principal amount of
1.875% Convertible Senior Notes at a premium which were offered as an additional
issuance of our $150.0 million Convertible Senior Notes due 2024 issued on
November 22, 2019. Net proceeds were used to repay all outstanding borrowings
under the our 2022 tranche of senior secured term loans of $31.2 million and
repay a portion of borrowings outstanding under our asset-based loan facility.
We incurred transaction costs of approximately $1.4 million which were
capitalized as deferred financing fees to be amortized over the term of the
underlying debt.

On June 8, 2020, we amended our senior secured credit agreement which converted
$238.1 million of the term loans then outstanding into a new tranche of term
loans (the "2025 Tranche"), which, among other things, extended the maturity
date by three years and increased the fixed-rate portion of interest charged by
200 basis points. The Company made a prepayment of $35.7 million on the 2025
Tranche immediately after it was established. See Note 9 "Debt Obligations" to
our consolidated financial statements for a full description.

On March 18, 2020, we drew $100.0 million on our asset-based loan facility to
increase our cash on hand during the early stages of the Pandemic's impact to
our business and have subsequently repaid $80.0 million of the draw.

On November 22, 2019, we issued $150.0 million aggregate principal amount of
1.875% Convertible Senior Notes (the "Senior Notes"). Approximately $43.2
million of the net proceeds were used to repay all borrowings then outstanding
under our ABL and the remainder was used for working capital, general corporate
purposes and acquisitions.

A portion of the interest rate charged on our Term Loan is currently based on
LIBOR and, at our option, a component of the interest charged on the borrowings
outstanding on our ABL, if any, may bear interest rates based on LIBOR. LIBOR
has been the subject of reform and was expected to phase out by the end of
fiscal 2021, however, on November 30, 2020, the ICE Benchmark Administration
Limited ("ICE") announced plans to delay the phase out of LIBOR to June 30,
2023. The consequences of the discontinuation of LIBOR cannot be entirely
predicted but could impact the interest expense we incur on these debt
instruments. We will negotiate alternatives to LIBOR with our lenders before
LIBOR ceases to be a widely available reference rate.

Share offering

At May 14 and June 2, 2020we completed public offerings for a total of 6,634,615 common shares, which generated net proceeds of approximately $85.9 million. See Note 10 “Equity” to our consolidated financial statements for a complete description.

Liquidity


The following table presents selected financial information on liquidity (in
thousands):

                                             December 24, 2021           December 25, 2020           December 27, 2019
Cash and cash equivalents                  $          115,155          $          193,281          $          140,233
Working capital,(1) excluding cash and
cash equivalents                           $          157,787          $           94,279          $          162,772
Availability under asset-based loan
facility                                   $          109,459          $           50,282          $           90,015


(1) We define working capital as current assets less current liabilities.


We believe our existing balances of cash and cash equivalents, working capital
and the availability under our asset-based loan facility, are sufficient to
satisfy our working capital needs, capital expenditures, debt service and other
liquidity requirements associated with our current operations over the next
twelve months.

Our capital expenditures, excluding cash paid for acquisitions, were approximately $38.8 million for fiscal 2021. We estimate that our capital expenditures, excluding cash paid for acquisitions, for fiscal 2022 will be approximately $35.0 million for $45.0 million.






                                       38
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Cash Flows

                                                                       Fiscal Year Ended
                                           December 24, 2021           December 25, 2020           December 27, 2019
Net (loss) income                        $           (4,923)         $          (82,903)         $           24,193
Non-cash charges                         $           47,372          $           62,509          $           47,625
Changes in working capital               $          (62,348)         $           63,275          $          (26,811)
Cash (used in) provided by operating
activities                               $          (19,899)         $           42,881          $           45,007

Cash flows used in investing activities $ (48,991) $

     (67,968)         $          (44,154)
Cash (used in) provided by financing
activities                               $           (9,222)         $           78,056          $           96,947



Fiscal Year 2021 Cash Flows

Net cash used in operations was $19.9 million for fiscal 2021 consisting of a
$4.9 million net loss and and investments in working capital of $62.3 million,
partially offset by $47.4 million of non-cash charges. Non-cash charges
decreased predominately due to the $24.2 million write down of Del Monte and
Bassian trademarks in fiscal 2020. The cash used in working capital of $62.3
million is primarily driven by reinvestment in working capital to support
growth.

Net cash used in investing activities was $49.0 million in fiscal 2021 driven by
$38.8 million in capital expenditures which included the build-outs of our Los
Angeles, New England and Miami distribution facilities. We used $10.2 million in
cash to fund several acquisitions.

Net cash used in financing activities was $9.2 million for fiscal 2021 driven by
$37.6 million of payments made on senior term loans and finance lease
obligations and a $20.0 million payment on our asset-based loan facility,
partially offset by $51.8 million of proceeds from the issuance of additional
convertible senior notes.

Fiscal Year 2020 Cash Flows

Net cash provided by operations was $42.9 million for fiscal 2020 consisting of
a $82.9 million net loss, offset by $62.5 million of non-cash charges and an
increase in working capital of $63.3 million. Non-cash charges increased
predominately due to the $24.2 million write down of Del Monte and Bassian
trademarks. The increase in working capital of $63.3 million is primarily driven
by negotiating favorable credit terms with our customers and suppliers and
maintaining lower inventory balances as a result of reduced demand due to the
Pandemic.

Net cash used in investing activities was $68.0 million in fiscal 2020 driven by
$7.0 million in capital expenditures which included implementations of our
Enterprise Resource Planning ("ERP") system. We used $60.9 million in cash to
fund acquisitions, the most significant of which were Sid Wainer and Cambridge.

Net cash provided by financing activities was $78.1 million for the 2020 financial year carried by $85.9 million net proceeds from our common stock offering and $40.0 million net drawdowns on our asset-backed loan facility, partially offset by debt repayments and finance lease obligations of $40.4 million.

Seasonality


Excluding our Allen Brothers direct-to-consumer business, we generally do not
experience any material seasonality. However, our sales and operating results
may vary from quarter to quarter due to factors such as changes in our operating
expenses, management's ability to execute our operating and growth strategies,
personnel changes, demand for our products, supply shortages, weather patterns
and general economic conditions.

Our Allen Brothers direct-to-consumer business is subject to seasonal
fluctuations, with direct-to-consumer center-of-the-plate protein sales
typically higher during the holiday season in our fourth quarter; accordingly, a
disproportionate amount of operating cash flows from this portion of our
business is generated by our direct-to-consumer business in the fourth quarter
of our fiscal year. Despite a significant portion of these sales occurring in
the fourth quarter, there are operating expenses, principally advertising and
promotional expenses, throughout the year.

The pandemic has had a significant impact on our business and operations as well as those of our customers. Our net sales were most impacted during the second quarter of fiscal 2020 when, in an effort to limit the spread of the virus, federal, state,

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and local governments began implementing various restrictions that resulted in
the closure of non-essential businesses in many of the markets we serve, which
forced our customers in those markets to either transition their establishments
to take-out service, delivery service or temporarily cease operations.

Inflation


Our profitability is dependent on, among other things, our ability to anticipate
and react to changes in the costs of key operating resources, including food and
other raw materials, labor, energy and other supplies and services. Substantial
increases in costs and expenses could impact our operating results to the extent
that such increases cannot be passed along to our customers. The impact of
inflation on food, labor, energy and occupancy costs can significantly affect
the profitability of our operations.

Significant contractual commitments and obligations

The following table summarizes our contractual obligations and commercial commitments to December 24, 2021:

Payments due per period (1, 2)

                                                                      Less than One           1-3                4-5
                                                      Total               Year               Years              Years            Thereafter
                                                                                         (In thousands)

Indebtedness                                       $ 403,991          $    5,662          $ 234,790          $ 163,539          $        -
Finance lease obligations                          $  12,748          $    3,834          $   5,553          $   3,192          $      169
Pension exit liabilities                           $   1,861          $      170          $     375          $     428          $      888
Long-term operating leases                         $ 216,423          $   24,726          $  38,167          $  27,644          $  125,886

Total                                              $ 635,023          $   34,392          $ 278,885          $ 194,803          $  126,943



(1)Interest on our various outstanding debt instruments is included in the above
table, except for our Term Loans and ABL, which have floating interest rates. At
December 24, 2021, we had borrowings of $168.7 million under our Term Loans and
$20.0 million under our ABL. See Note 9 "Debt Obligations" to our consolidated
financial statements for further information on our debt instruments.
(2)The table above excludes $6.9 million of total contingent earn-out
liabilities related to certain acquisitions as of December 24, 2021 and
approximately $10.0 million of lease payments related leases for distribution
facilities that do not commence until fiscal 2022.

We had outstanding letters of credit of approximately $20.5 million and $20.1
million at December 24, 2021 and December 25, 2020, respectively. Substantially
all of our assets are pledged as collateral to secure our borrowings under our
credit facilities.

Off-balance sheet arrangements

From December 24, 2021we had no off-balance sheet arrangements, as defined in Section 303(a)(4)(ii) of Regulation SK.

Critical accounting policies


The preparation of our consolidated financial statements requires us to make
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses, and related disclosure of contingent assets and
liabilities. The SEC has defined critical accounting policies as those that are
both most important to the portrayal of our financial condition and results and
require our most difficult, complex or subjective judgments or estimates. Based
on this definition, we believe our critical accounting policies include the
following: (i) determining our allowance for doubtful accounts, (ii) inventory
valuation, with regard to determining inventory balance adjustments for excess
and obsolete inventory, (iii) business combinations, (iv) valuing goodwill and
intangible assets, (v) self-insurance reserves, (vi) accounting for income taxes
and (vii) contingent earn-out liabilities. For all financial statement periods
presented, there have been no material modifications to the application of these
critical accounting policies.

Allowance for doubtful accounts

We analyze customer creditworthiness, customer account balances, payment history, payment terms and bad debt history

                                       40
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levels when evaluating the adequacy of our allowance for doubtful accounts. In
instances where a reserve has been recorded for a particular customer, future
sales to the customer are either conducted using cash-on-delivery terms or the
account is closely monitored so that agreed-upon payments are received prior to
orders being released. A failure to pay results in held or cancelled orders. We
also estimate receivables that will ultimately be uncollectible based upon
historical write-off experience. Management incorporates current macro-economic
factors in existence as of the balance sheet date that may impact the
food-away-from-home industry and/or its customers, and specifically, beginning
in the first quarter of fiscal 2020, the impact of the Pandemic. We may be
required to increase or decrease our allowance for doubtful accounts due to
various factors, including the overall economic environment and particular
circumstances of individual customers. Our accounts receivable balance was
$172.5 million and $96.4 million, net of the allowance for doubtful accounts of
$20.3 million and $24.0 million, as of December 24, 2021 and December 25, 2020,
respectively.

Inventory Valuation

We adjust our inventory balances for excess and obsolete inventories. These
adjustments are primarily based upon customer demand, inventory age,
specifically identified inventory items and overall economic conditions. A
sudden and unexpected change in consumer preferences or change in overall
economic conditions could result in a significant change to these adjustments
that could require a corresponding charge to earnings. We actively manage our
inventory levels as we seek to minimize the risk of loss and have consistently
achieved a relatively high level of inventory turnover. As a result of the
impacts of the Pandemic on our customer demand we incurred additional inventory
valuation charges of $14.6 million in fiscal 2020.

Business combinations


We account for acquisitions in accordance with Accounting Standards Codification
Topic 805 "Business Combinations." Assets acquired and liabilities assumed are
recorded at their estimated fair values, as of the acquisition date. The
judgments made in determining the estimated fair value of assets acquired and
liabilities assumed, including estimated useful life, may have a material impact
on our consolidated balance sheet and may materially impact the amount of
depreciation and amortization expense recognized in periods subsequent to the
acquisition. We determine the fair value of intangible assets using an income
approach and, when appropriate, we engage a third party valuation firm.
Generally, we utilize the multi-period excess earnings method to determine the
fair value of customer relationships and the relief from royalty method to
determine the fair value of tradenames. These valuation methods contain
significant assumptions and estimates including forecasts of expected future
cash flows and discount rates. Determining the useful life of an intangible
asset also requires judgment, as different types of intangible assets will have
different useful lives. The excess of the purchase price over the fair values of
identifiable assets and liabilities is recorded as goodwill.

Valuation of Good will and intangible assets


We are required to test goodwill for impairment at each of our reporting units
annually, or more frequently when circumstances indicate an impairment may have
occurred. We have elected to perform our annual tests for indications of
goodwill impairment during the fourth quarter of each fiscal year.

Goodwill is tested at the reporting unit level, which is an operating segment or
a component of an operating segment. When analyzing whether to aggregate
components into single reporting units, management considers whether each
component has similar economic characteristics. We have evaluated the economic
characteristics of our different geographic markets, including our recently
acquired businesses, along with the similarity of the operations and margins,
nature of the products, type of customer and methods of distribution of products
and the regulatory environment in which we operate and concluded that the
business consists of three operating segments: East Coast, Midwest and West
Coast and these operating segments represent our reporting units.

In testing goodwill for impairment, we may elect to perform a qualitative
assessment to evaluate whether it is more likely than not that the fair value of
each reporting unit is less than its carrying amount. The qualitative analysis
considers various factors including macroeconomic conditions, market conditions,
industry trends, cost factors and financial performance, among others. If our
qualitative assessment indicates that goodwill impairment is more likely than
not, we proceed to perform a quantitative assessment to determine the fair value
of the reporting unit.

When a quantitative analysis is required, we estimate the fair value of our
reporting units using an income approach that incorporates the use of a
discounted cash flow model that involves many management assumptions that are
based upon future growth projections. Assumptions include estimates of future
revenue based upon budget projections and growth rates which include estimates
for the duration of the Pandemic's impact on the Company's customers. We develop
estimates of future levels of gross and operating profits and projected capital
expenditures. This methodology includes the use of estimated discount rates
                                       41
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based upon industry and competitor analysis as well as other factors. A goodwill
impairment loss, if any, would be recognized for the amount by which a reporting
unit's carrying value exceeds its fair value.

For the year ended December 24, 2021the Company has assessed the recoverability of goodwill using qualitative analysis and has determined that it is more likely than not that the fair value of its reporting units will exceed their respective carrying values.


Due to the Pandemic's adverse impact on our business in fiscal 2020, we
performed an interim quantitative goodwill impairment test as of March 27, 2020
and concluded that goodwill was not impaired. We performed our annual goodwill
impairment test during the fourth quarter of fiscal 2020 using a quantitative
analysis, the results of which indicated that goodwill was not impaired. Total
goodwill as of December 24, 2021 and December 25, 2020 was $221.8 million and
$214.9 million, respectively.

Definite life intangible assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The cash flows expected to be generated by the related assets are estimated over the useful life of the assets based on discounted projections. If the assessment indicates that the carrying amount of the asset may not be recoverable, the potential impairment is assessed based on a discounted cash flow model.


During the second quarter of fiscal 2021, we committed to a plan to shift our
brand strategy to leverage the Allen Brothers brand in our New England region
and determined the Cambridge trademark did not fit our long-term strategic
objectives. As a result, we recognized a $0.6 million impairment charge, $0.4
million net of tax, to fully write-down the net book value of our Cambridge
trademark

During the fourth quarter of fiscal 2020, we committed to a plan to shift our
brand strategy to leverage our Allen Brothers brand in our west coast region and
determined our Del Monte, Ports Seafood and Bassian Farms trademarks did no fit
our long-term strategic objectives. This brand transition began in the second
quarter of fiscal 2021. The Company assessed these trademarks for impairment and
used the relief of royalty method to determine fair value. Significant
assumptions used include future sales forecasts, royalty rates and discount
rates. As a result, we recorded a $24.2 million impairment charge, $17.5 million
net of tax, to write-down the value of our Del Monte and Bassian Farms
trademarks.

There have been no other events or changes in circumstances during fiscal 2021
or 2020 indicating that the carrying value of our finite-lived intangible assets
are not recoverable. Total finite-lived intangible assets as of December 24,
2021 and December 25, 2020 were $104.7 million and $111.7 million, respectively.

The assessment of the recoverability of goodwill and intangible assets contain
uncertainties requiring management to make assumptions and to apply judgment to
estimate economic factors and the profitability of future operations. Actual
results could differ from these assumptions and projections, resulting in us
revising our assumptions and, if required, recognizing an impairment loss.

Self-insurance reserves


We maintain a self-insured group medical program. The program contains
individual stop loss thresholds of $300 thousand per incident and aggregate stop
loss thresholds based upon the average number of employees enrolled in the
program throughout the year. The amount in excess of the self-insured levels is
fully insured by third party insurers. Liabilities associated with this program
are estimated in part by considering historical claims experience and medical
cost trends. Projections of future loss expenses are inherently uncertain
because of the random nature of insurance claims occurrences and could be
significantly affected if future occurrences and claims differ from these
assumptions and historical trends.

We are self-insured for workers' compensation and automobile liability to
deductibles or self-insured retentions of $500 thousand per occurrence. The
amounts in excess of our deductibles are fully insured by third party insurers.
Liabilities associated with this program are estimated in part by considering
historical claims experience and cost trends. Projections of future loss
expenses are inherently uncertain because of the random nature of insurance
claims occurrences and could be significantly affected if future occurrences and
claims differ from these assumptions and historical trends.

Income taxes


The determination of our provision for income taxes requires significant
judgment, the use of estimates and the interpretation and application of complex
tax laws. Our provision for income taxes primarily reflects a combination of
income earned and taxed in the various U.S. federal and state jurisdictions.
Jurisdictional tax law changes, increases or decreases in permanent
                                       42
--------------------------------------------------------------------------------

differences between accounting and tax items, accruals or accrual adjustments for unrecognized tax benefits, and our change in the earnings mix of these tax jurisdictions all affect the effective tax rate global.


We estimate our ability to recover deferred tax assets within the jurisdiction
from which they arise. This evaluation considers several factors, including
recent results of operations, scheduled reversal of deferred tax liabilities,
future taxable income and tax planning strategies. As of December 24, 2021 and
December 25, 2020, we had valuation allowances of $2.0 million and $2.3 million,
respectively, relating to certain net operating losses that may not be
realizable in the future based on taxable income forecasts and certain state net
operating loss limitations.

Conditional commitments related to price supplements


We account for contingent consideration relating to business combinations as a
liability and an increase to goodwill at the date of the acquisition and
continually remeasure the liability at each balance sheet date by recording
changes in the fair value through our consolidated statements of operations. We
determine the fair value of contingent consideration based on future operating
projections under various potential scenarios, including the use of Monte Carlo
simulations, and weight the probability of these outcomes. The ultimate
settlement of contingent earn-out liabilities relating to business combinations
may be for amounts which are materially different from the amounts initially
recorded and may cause volatility in our results of operations.

Management has discussed the development and selection of these critical
accounting policies with our board of directors, and the board of directors has
reviewed the above disclosure. Our consolidated financial statements contain
other items that require estimation, but are not as critical as those discussed
above. These other items include our calculations for bonus accruals,
depreciation and amortization. Changes in estimates and assumptions used in
these and other items could have an effect on our consolidated financial
statements.

Recent accounting pronouncements


See Note 1 "Operations and Basis of Presentation" to our consolidated financial
statements for a full description of recent accounting pronouncements including
the respective expected dates of adoption and expected effects on our
consolidated financial statements.

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© Edgar Online, source Previews

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2021 Dividend Income Update | Looking for Alpha https://eventplaner.net/2021-dividend-income-update-looking-for-alpha/ Fri, 18 Feb 2022 12:59:00 +0000 https://eventplaner.net/2021-dividend-income-update-looking-for-alpha/

erdikocak/iStock via Getty Images

It’s time to post my total 2021 dividends received from three stock accounts.

Total dividends from my brokerage account: $13,232.01

Total dividends from my Roth account: $703.44

Total dividends from my IRA account: $99.45

Grand total for 2021: $14,034.90

My overall portfolio values ​​and financial mental values ​​have really changed over the past year. When I talk about wallets, I also include my crypto holdings. Don’t worry, I’m still a strong believer in investing in long-term dividend growth. I still have all my shares in my brokerage account and I still invest and reinvest the dividends for the “baby” (more baby) DivHut. That being said, the reason for my mental shift in finance was a result of seeing my crypto portfolio gain over my stock portfolio and then overtaking it by a long shot reaching a hair under seven figures.

I really got into bitcoin and ether in mid-2017 buying the crypto assets as low as $3,000 for BTC (BTC-USD) and just under $300 for ETH (ETH-USD). Glad to say that I held on and kept buying through the crypto winter while sleeping well at night as the volatility of these crypto assets would swing wildly. No sale for me.

Crypto assets are the future, especially BTC. I am not here to tell anyone to buy BTC. All I’m saying is that for me it’s an important part of an overall asset portfolio allocation. As you know, some of us only invest in dividend-paying stocks, which may or may not include ETFs, REITs, mutual funds and the like (some are averse to these types of assets in a portfolio of dividend income). Some of us invest directly in real estate, precious metals as well. I have read blog posts about people investing in lending platforms. Either way, we all diversify into other asset classes as we see fit. Personal finance, right? The key word being personal.

A notable change to my portfolios going forward was the liquidation of my Roth and IRA portfolios for one asset, Grayscale Bitcoin Trust (OTC:GBTC). Looking for longer term exposure to bitcoin, I bought GBTC with these accounts because I can’t touch that money until retirement age anyway. Going forward, my retirement accounts will no longer provide dividend income. I may have to wait a while for these accounts to mature as BTC increases in value, but I can wait. I’m here for the long term, dividends and BTC. The brokerage account remains the same with all the same dividend kings, aristocrats, challengers, etc. that we all know and love. I still have my Apple (AAPL), Microsoft (MSFT), Johnson & Johnson (JNJ), Abbott Laboratories (ABT), AbbVie (ABBV), General Mills (GIS), Unilever (UL), Pfizer (PFE), The Southern Company (SO), 3M Company (MMM), McDonald’s Corporation (MCD), Yum! Brands (YUM), Consolidated Edison (ED), T. Rowe Price Group (TROW), PepsiCo (PEP), The Coca-Cola Company (KO) and many more. Like I said, I’m still into dividend growth investing.

Disclosure: Long all stocks mentioned

Original post

Editor’s note: The summary bullet points for this article were chosen by the Seeking Alpha editors.

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Katie Miller https://eventplaner.net/katie-miller/ Tue, 15 Feb 2022 21:11:42 +0000 https://eventplaner.net/katie-miller/

Experience

Katie has worked in nearly every consumer financial services industry over an 18 year period. She began developing new credit card products, transitioning her organization from a “metal line” (silver, gold, platinum) of credit cards to the new “rewards line” of cards in the early 2000s. , when maximizing consumer rewards was still an issue. develop an art form. She’s spent countless hours researching reward redemption thresholds, fine print, and internal P&Ls, and still has fun optimizing card returns in her personal spend.

She spent years throughout the recession leading teams in consumer analytics, credit card and collections, risk and training to identify and minimize risk while maximizing opportunities for consumers to get much-needed credit. Following the recession, she was recruited to lead a large mortgage lending team where she implemented significant regulatory changes resulting from the Dodd Frank (QM and TILA-RESPA) regulations amid ongoing economic and real estate regulatory upheaval, while doubling its wallets thanks to well-help assistance. educated and satisfied consumers. During this time, she graced the cover of MLife magazine (a mortgage industry) and was quoted in numerous publications as an industry expert.

Immediately before the pandemic, she led an operational and strategic team managing savings, checking, IRA, CD and trust products and is passionate about financial education and ensuring that everyone understands their options financial. She ended her corporate career leading the implementation of an enterprise cloud data repository, data governance, data privacy, and AI solution, revolutionizing business opportunities. consumer information.

Katie retired at 41 as an enthusiast of the FIRE (Financial Independence Retire Early) movement and currently volunteers as a consultant in leadership and growth strategies for small businesses.

Education

Katie received her Bachelor of Arts in Mathematics and Economics from Dartmouth College and was an NCCO (NAFCU Certified Compliance Officer), maintaining a thorough understanding of the rules and regulations that govern the credit union industry.

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Q&A: How to raise over $50 million for storage development https://eventplaner.net/qa-how-to-raise-over-50-million-for-storage-development/ Tue, 08 Feb 2022 22:58:11 +0000 https://eventplaner.net/qa-how-to-raise-over-50-million-for-storage-development/

Sharpen your funding pitch and you could end up like DXD Capital, which hoped to raise $50 million in its first round of funding but went above and beyond, hitting $53 million before closing the round.

“What I learned this time is that the more finite focus and strategy you have, the more groups are interested in hearing what you have to say,” said Drew Dolan, principal and fund manager at DXD Capital, based in Albuquerque. , NM.

“Of the groups that said no, some of them can’t do real estate or the timing didn’t work out. Very few said they didn’t like our strategy or weren’t interested in self-storage.

DXD has invested $10.1 million in the development of fully air-conditioned facilities in Las Vegas, NV and Phoenix, AZ. Overall, the fund has 12 approved investments in multiple states, including Florida, New Jersey, and Rhode Island.

We chatted with Dolan about the first ride, self-storage and more.

Storage Beat: What did you learn from this increase?

Dolan: We entered this fund at the start of COVID, the darkest and most uncertain days of COVID. There’s been an election, a recession, and a pandemic, and here we are, starting a new business and raising capital.

But some of the benefits were that we could show up in San Antonio or Denver, and everyone wanted to meet us. They were tired of being locked up in their homes.

The election was over and there was some certainty, and that made our world easier. The stock market rebounded. There was a vaccine. The economy has recovered. We have come out of the recession.

Self-service storage performance showed up and it was amazing to see how well the asset performed during COVID. Serious headwinds have become serious tailwinds.

Who were your buyers?

Mainly high net worth and small to medium sized family offices. The commonality for most was that every investor had a story about self-storage. They used it, or their parents used it when they moved into a seniors’ residence. Our story resonated about how this was going to be successful.

How has the pandemic affected your efforts?

In the end, the self-storage worked very well. People have moved furniture from the bedroom and created a home office or a home gym. Highest rate (nearly 50%) of 18-29 year olds living at home since the 1930s. Parents had to move stuff, into storage.

How was self-storage more efficient?

If you have an office building and 10 tenants, and one tenant isn’t renewing because they’ve been hit by the recession, you’ve just lost 10% of your revenue. In self-storage, the average of our installations is 1,000 units; you never really see a dramatic decrease in occupancy… Self-storage was never mentioned in the same breath as office or industrial. But the asset’s performance in good and bad times made institutions realize they needed it.

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Why Activist Investors Are Targeting Department Stores https://eventplaner.net/why-activist-investors-are-targeting-department-stores/ Sat, 29 Jan 2022 05:30:00 +0000 https://eventplaner.net/why-activist-investors-are-targeting-department-stores/

Change is coming to department stores, whether they like it or not.

This week, two investment groups moved to buy US chain Kohl’s: a consortium of investors backed by hedge fund Starboard Value LP made a $9 billion bid, and private equity firm Sycamore Partners would prepare a competing offer.

Even before potential buyers emerged, Kohl’s was already the target of activist investors Engine Capital and Macellum Advisors, who are pressuring the Wisconsin-based company to sell its real estate and spin off its e-commerce business. The idea is that offloading certain properties will generate cash flow for the business, and then the retailer will lease its most profitable stores instead. With digital separation, creating an independent online entity is a tactic to attract new capital.

Kohl’s isn’t the only department store operator facing the prospect of being sold off. Retailers in this space have long struggled to increase sales and keep pace with new rivals both online and in the mall. This has led some investors to see their true value in the land and buildings they occupy, or in their brand, rather than in their ability to sell clothes, handbags and shoes. These investors have plenty of money to test this theory.

Richard Baker, owner of Saks Fifth Avenue, sold Lord & Taylor for $100 million in 2019 while retaining the chain’s real estate assets. A year later, the retailer was sold in a bankruptcy auction to investor Saadia Group, which continues to operate its website.

Baker is also behind the trend of e-commerce spinoffs, where stores are separated from their websites. In an agreement announced in March 2021, Saks.com became the main Saks entity and received a $500 million investment from private equity firm Insight Partners, while Saks’ 40 physical stores will operate separately as an entity called “SFA”. Since last fall, Saks has been planning an initial public offering that could value the e-commerce part of the business at $6 billion. Seeing that impressive valuation, activist investor Jana Partners took a stake in Macy’s in October and urged the chain to follow suit.

Real estate transactions and e-commerce spinoffs can be lucrative for a retailer’s investors. What this means for the fashion industry is less clear. Sales spiked at Saks in the months following the spinoff, and Neiman Marcus appears to be finding its footing after several years of boardroom maneuvering, including a bankruptcy filing. But the most publicized example of this kind of financial engineering remains Sears, which was acquired by billionaire Eddie Lampert in 2005. As losses mounted, Lampert spun the company’s properties into an independent REIT, a decision that failed to save Sears from bankruptcy and eventual liquidation.

“Are the breakups of these companies a short-term gain? Yes,” said Robert Burke, retail consultant. “But can this also be a long-term game? Well, we don’t know.

“The department store is dead”

Activist investors and hedge funds are trying to answer the same question as the current management of these retailers: whether, after two decades of declining sales, America’s department stores can be saved.

According to the US Census Bureau, department store sales peaked at around $20 billion in January 2001, but fell to $11 billion in February 2020, just before the pandemic hit the United States. The numbers have risen since lockdowns ended, hitting $12.4 billion in October 2021, but resumed their historic decline thereafter. Many analysts predict further deterioration, especially if inflation causes consumers to spend less on discretionary items such as clothing.

“Retail is in a situation where all players are vulnerable right now,” said Rebecca Duval, analyst at BlueFin Research.

Department stores have tried everything from buying rivals to launching in-house clothing and beauty lines in different store formats. Kohl’s best-known innovation was to partner with Amazon, somewhat its biggest competitor, to allow customers to return orders placed with the online retailer at its stores. It recently started opening in-store Sephora stores and was quick to offer customers hybrid online shopping and in-store pickup options during the pandemic, taking advantage of the convenient location of many of its stores. stores in neighborhood strip malls rather than indoor malls.

For its efforts, Kohl’s saw its revenue drop less dramatically than Macy’s or JC Penney. But sales haven’t increased either. Revenue of $18.8 billion in 2019 was just below the $19 billion in 2013.

Starboard’s offer represents a 37% premium to where Kohl’s shares previously traded. This represents the potential value generated by its goods and equipment, valued at $6.7 billion at the start of 2021, as well as its e-commerce business, which accounted for 29% of the company’s $4.4 billion in sales. business in the third quarter of 2021. In the nine months ending October 31 of last year, Kohl’s generated $12.3 billion in net sales.

But if Starboard or Sycamore didn’t actually change the way Kohl’s operates and seriously invests in its future, its post-sales trajectory would look much like it does today: stagnant sales and a constant struggle to stay relevant. The same goes for other retailers who would be on the auction block.

“There are 100 retailers in the same boat, where they thought bringing Amazon returns or a coffee would solve their problems,” said Lee Peterson, executive vice president of retail consultancy WD Partners. “But the writing is on the wall. The department store model is dead.

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Longfor joins peers with Spinoff, IPO for property management arm (undefined: LGFRY) https://eventplaner.net/longfor-joins-peers-with-spinoff-ipo-for-property-management-arm-undefined-lgfry/ Sat, 15 Jan 2022 18:04:00 +0000 https://eventplaner.net/longfor-joins-peers-with-spinoff-ipo-for-property-management-arm-undefined-lgfry/

rzoze19/iStock via Getty Images

Property developers have been filming their property management units for several years, seeking to raise funds and better differentiate between the two types of activity. One exception was Longfor Group (OTCPK:LGFRY) (0960.HK), a top 10 developer who insisted it had no such plans. But times have changed, and now the company is following its peers in asking to list its Hong Kong property management operations separately.

On January 7, the company launched a new brand called Longfor Intelligent Living Ltd., which integrated its intelligent services and business operations. On the same day, the new company filed an IPO application with the Hong Kong Stock Exchange.

Longfor Intelligent Living had about 250 million square meters of properties and 1,512 projects under management as of Dec. 28, about 80 percent of them in first- and second-tier cities, according to the prospectus.

In terms of national ranking, Country Garden Services (6098.HK), Vanke Service and A-Living Smart City Services (3319.HK) all had 500 million square meters of properties under management in 2021. Longfor Intelligent Living rose in the top 10 with a ninth place finish, according to real estate information provider CRIC Research.

The amount of assets under management is directly linked to the income base of a management company and can therefore to a large extent determine its valuation. With this in mind, many companies resorted to mergers and acquisitions right before their IPO to expand their scale, and Longfor Intelligent Living is no exception.

Cash crisis

Last year, Beijing launched a tough campaign to deleverage China’s real estate sector, making it harder for companies to access financing for new projects and repay short-term debt. In this environment, many have given up their property management arms to raise funds quickly. Longfor Intelligent Living had largely avoided the acquisitions that many of its peers were doing, but suddenly changed and went on its own shopping spree.

Last March, it bought the property management business of Yida China (3639.HK) for 1.27 billion yuan ($200 million). It acquired Henan province-based Kailin Property Management in August and swallowed up part of the property management services of Wharf Holdings (0004.HK) in September. In that process, the company’s portfolio of co-managed real estate projects jumped 74.9% to 696 from 398 at the end of 2020, according to its prospectus.

These agreements not only widened the scope of the company, but also reduced its dependence on its parent company. In the first nine months of 2021, revenue from properties associated with Longfor Group and its subsidiaries totaled 2.33 billion yuan, which is only 30% of Longfor Intelligent Living’s total. The remaining 70% came from his activities with other developers.

But heavy spending on acquisitions weighed on the company’s gross profit margins, which were 29.2%, 25.8% and 27.6%, respectively, in the first nine months of 2019, 2020 and 2021 – a relatively low level compared to its peers. According to the latest data, it now charges an average of 3.44 yuan per square meter per month for management services for Longfor Group and its subsidiaries. This was well above the 2.39 yuan per square meter per month it charged other developers.

It should be emphasized that while mergers and acquisitions present opportunities for expansion, they also present risks for property managers. Northeast Securities believes that companies such as Sichuan Languang Justbon Services Group and Color Life Services Group (1778.HK) have seen slower revenue growth in recent years despite rapid expansion, in part due to low quality of new projects that do not fit well with their original portfolios. Businesses are also at risk if landlords terminate their contracts or if maintenance costs rise too quickly.

Social guard dogs

Property managers have played a key role in protecting public safety and activating community operations during the Covid-19 pandemic, which has also provided opportunities for the deployment of new value-added community services. As a result, the sector was rewarded with higher stock market valuations, which reached record highs in 2020. As a result, stocks in the Hang Seng Property Service and Management Index were more than 60 times higher than their highs.

But the group went into freefall in the second half of last year after Beijing introduced its latest policies to regulate the market. By the end of last year, the sector’s average P/E ratio had fallen to just 17.5x, which is quite low by historical standards. But this average belies large differences between companies. The big ones tended to get higher valuations, while the smaller ones or those with limited growth potential were the hardest hit.

Citic Securities pointed out that the most comparable company for Longfor Intelligent Living is China Resources Mixc Lifestyle Services (1209.HK), as most of their properties and malls under management are concentrated in first- and second-tier cities, and the two are trying to coordinate their property management and shopping center operations.

Longfor Intelligent Living has yet to announce the price and valuation of its IPO. But investors can get an idea using the P/E ratios of its peers, including China Resources Mixc Lifestyle Services, which has a relatively high P/E ratio of 57 times, and Country Garden Services and Poly Property Services (6049 .HK), which have lower ratios of 32 and 36 times.

The prospectus shows net profit of 1.13 billion yuan for the company in the first three quarters of last year, which translates to about 1.5 billion yuan on an annualized basis. Using an average P/E ratio of around 40 times for the three aforementioned companies yields a market value of around HK$73.2 billion ($9.4 billion) for Longfor Intelligent Living.

Unlike some of its peers, the parent company of Longfor Intelligent Living is in good financial shape and therefore not under pressure to raise large sums to replenish its coffers. Given its flexibility and the strong position of its parent company, its valuation could even exceed expectations as it becomes one of the few property management companies to make a new listing in the short term.

Disclosure: Nothing

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Prince’s estate finally valued at $156 million https://eventplaner.net/princes-estate-finally-valued-at-156-million/ Sat, 15 Jan 2022 14:16:16 +0000 https://eventplaner.net/princes-estate-finally-valued-at-156-million/

The six-year legal battle over the value of Prince’s estate has finally been settled, with the figure standing at $156.4 million.

Details emerged in a court filing on January 14, quickly ending the dispute, which was due to return to court in March. Comerica Bank, the administrator of the estate, had recorded a value of $82.3 million, while the IRS estimated it was worth $163.2 million and also wanted to impose a ‘correctness penalty’ of $6.4 million.

” Since Tribune of the Stars reported, “a phalanx of attorneys and consultants were paid tens of millions of dollars to administer his estate and come up with a plan for his distribution. Two of Prince’s six heir siblings, Alfred Jackson and John R. Nelson, have since died. Two others are over 80 years old.

The report adds that, assuming all agreements are in place, “the estate will be almost evenly split between a well-funded New York music company – Primary Wave – and the three oldest of the music icon’s six heirs. music or their families”. This arrangement comes after three siblings strike a deal with Primary Wave while the other three rejected him. The money could be split as early as next month, but the final figure to be split will come after the IRS and the state of Minnesota take their cuts, which are expected to total tens of millions.

Comerica Bank said in a statement that they believed they could have won the case had it completed its court journey, but that “members of the heir group have consistently communicated…their strong desire that the estate is settled with the tax authorities”. Additionally, the three siblings had previously spent an “undisclosed portion of their estate” on the law firm representing them. “It’s been six long years,” their attorney L. Londell McMillan said during the filing in Carver County District Court.

The value of Prince’s real estate had been agreed last year, but putting a price on “intangible assets” such as music rights proved more difficult. His death in 2016 without having drafted a will added further complexities to the liquidation process.

25 times Prince crossed paths with the biggest rock stars

Ask a musician if they have a Prince story to tell and they might just surprise you.

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Researchers Submit Patent Application, “Personal Profitability,” for Approval (USPTO 20210406997): Patent Application https://eventplaner.net/researchers-submit-patent-application-personal-profitability-for-approval-uspto-20210406997-patent-application/ Thu, 13 Jan 2022 23:23:29 +0000 https://eventplaner.net/researchers-submit-patent-application-personal-profitability-for-approval-uspto-20210406997-patent-application/

JANUARY 13, 2022 (NewsRx) — By a News Reporter – Staff News Editor at Daily Insurance News — From washington d.c., NewsRx reporters report that a patent application filed by inventor Park, Grace (Amagansett, NY, United States), filed on November 26, 2018, was posted on December 30, 2021.

No assignee for this patent application has been named.

The news editors got the following quote from the background information provided by the inventors: “Financial independence is a topic on the minds of many people: whether you’re a millennial or a baby boomer, the ability to Making sure you have enough money to last a lifetime is a major source of stress for most people.Although people have tried using budgeting, financial advisors, and self-directed investing, it doesn’t There is no single holistic framework that connects the key elements of a person’s financial health: expenses and income, assets and liabilities, from the perspective of today and tomorrow’s years as a dashboard for future actions Due to fragmentation, many individuals tend to operate blindly, without context (e.g. how much money do they need in retirement) with disparate data (bank and brokerage statements), The services provided to ind ividus are either online with few personalized contacts or personalized by the individuals who can be paid to sell more expensive products compared to the same performance but less lucrative ones. By running a methodology such as personal profitability, an individual is able to understand their current financial situation, as well as identify actions they may need to take in the future. They will have the context and metrics to create transparency about how financial actions are helping or hindering their personal bottom line. »

In addition to general information about this patent application, NewsRx correspondents also obtained the inventor’s summary information for this patent application: “By providing a methodology, processes, and framework, an individual would be able to understand and to control its “profitability” in an integrated way. Using the personal balance sheet, monthly cash flow, and multi-year forecast view, the methodology integrates the important elements of an individual’s financial needs over time to present the individual’s performance against their future goals through reports on actuals and forecasts. future results. It is tied to and ties together what were once fragmented elements of an individual’s financial plan: assets, liabilities, and cash flows.

“The purpose and benefits of the system would be to allow the individual to make the necessary adjustments in their spending and investment decisions based on their goals, incomes and expenses over a period of years in as events based on its actual numbers and forecasts. Personal Profitability Analyzes allow the individual to view and monitor the impacts income, expenses and savings have on their overall financial health now and in the future using the Personal Monthly Cashflow Mode, Personal Balance Sheet and multi-year forecasts. Maintaining the integrity of analytics requires active foresight based on the concepts of risk, opportunity, provision, and task.

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The claims provided by the inventors are:

“1. A methodology called Personal Monthly Cash Flow which consists of a list of the major categories that make up Expenses (fixed and variable), Income and After-Tax Income, summarized with a total of Net Income (After-Tax Income minus total expenses) on a monthly basis.

“2. The methodology of claim 1, in which actual numbers are recorded for past months, and forecast numbers are ‘pencilized’ for future months for each line item, totaling a full year forecast for future months. Main categories of line items listed under expenses, income, and after-tax income.

“3. Methodology according to claim 1, in which the fixed expenses are the expense items that automatically arise each month, such as mortgages, rent, utilities, telephone bills, car payments, insurance health and insurance premiums.

“4. Methodology according to claim 1, wherein variable expenses represent expenses that are within the control of the individual and can generally be tracked by a payment method such as cash or credit/debit cards in categories specific items such as food, clothing and entertainment within the month. Bank statements.

“5. Methodology according to claim 1, wherein together, the fixed and variable expenses represent an individual’s total expenses per month for the full year (actual and forecasted).

“6. Methodology according to claim 1, in which the total income is composed of line items such as salary, dividends and interest income where both actual and forecast figures are recorded by month by category of line item.

“7. The methodology of claim 1, wherein after-tax income is calculated, by applying a tax rate to pre-tax income to calculate an after-tax income number, which is included on a separate line as income after tax depending on the tax treatment of the property.

“8. The methodology of claim 1, wherein the net income number is the difference between total expenses (fixed plus variable) and the after-tax income number, calculated for both actual and forecast months and maintained for any the year.

“9. A methodology called personal balance sheet records all assets and liabilities resulting in a total net worth, which is updated monthly to show the actual net worth count for the month.

10. The methodology of claim 9, wherein under Assets, categories include line items such as Cash and Cash Equivalents, Investment Accounts, and Real Estate.

“11. Under Investments, according to claim 10, would include items such as brokerage accounts, 401ks and IRA accounts.

“12. The methodology of claim 7, wherein under liabilities, the line items would include the current total outstanding value for all loans and debt securities such as student loans, mortgages, credit card debt, car loans, etc. listed separately.

“13. Methodology according to claim 9, wherein the net worth number is calculated as total assets minus total liabilities and represents the total net worth of the individual on a monthly basis for the full calendar year, the actuals and forecasts.

“14. A so-called multi-year forecasting methodology as claimed in claim 1, wherein the analysis represents the same categories of monthly cash flow line items but on an annual basis, to provide a multi-year view of net income for each year through at death.

“15. The methodology of claim 14, wherein the same line item categories, calculations and actuals for monthly cash flow analysis would be linked to the corresponding year in the multi-year forecast.

“16. A methodology according to claim 14, in which actual numbers are recorded for past months, and a forecast number is “entered” for future months for each line item, totaling a full year forecast for major categories line items listed under expenses, income, and after-tax income for each year until death.

“17. The methodology of claim 9, wherein the personal balance sheet net worth number is tied to the multi-year forecast in that personal balance sheet assets may be available to meet any financial shortfalls in future years. by sale/liquidation.

“18. A methodology in which the multi-year forecast would include assumptions for known changes in the forecast, such as retirement (salary would cease), Social Security, 401k, repos and required minimum distribution changes that would occur later in specific years.

“19. Methodology according to claims 1, 9 and 14, in which the management of Risks, Opportunities, Provisions and Tasks represents the 4 categories of possible events which would modify the forecasts of the Personal Balance Sheet, Monthly Cash How, or Mufti -Year Forecast.

“20. Methodology according to claims 1, 9 and 14, in which the risks represent events likely to occur which negatively affect and require adjusting one’s forecast of the personal balance sheet, the monthly cash flow and the multi-year forecast, which allow the individual to incorporate these risks into their forecasts.

“21. Methodology according to claims 1, 9 and 14, in which the Opportunities are events likely to occur which positively affect a person’s forecast figures of the Personal Balance Sheet, the Monthly Cash Flow Comment and the Mufti-Year Forecast, and are often tied to savings or increases in income such as a bonus or inheritance.

“22. Methodology according to claim 21, in which the opportunities would be affected in the personal balance sheet, the monthly cash flow and the multi-year forecast.

“23. Methodology according to claims 1, 9, 14, in which tasks are when an individual creates an additional goal beyond what is documented in the personal balance sheet, monthly cash flow and multi-year forecast, such as desire to pay for a child’s college tuition.

“24. Methodology, according to claim 23, in which task elements would be affected in the personal balance sheet, the monthly cash flow and the multi-year forecast.

“25. Methodology according to claims 1, 9, 14, wherein provision items represent assets that have not yet been tagged with a purpose but can be used for major expenses such as vacations without disrupting the plan documented and ongoing personal, monthly balance sheet Cash How and multi-year forecasts.

“26. Methodology according to claim 25, in which the provision elements would be affected in the personal balance sheet, the monthly cash flow and the multi-year forecast.

“27. Methodology according to claims 1, 9, 14, wherein once the above framework and analyzes are supplemented with actual and forecasted numbers, the individual can plan how to cover net income or value discrepancies current and future net worth through changes in spending, saving and investing as part of their overall strategy with the ability to monitor changes in actual and forecast numbers from all three analytics.

For more information on this patent application, see: Park, Grace. Personal profitability. Class November 26, 2018 and posted December 30, 2021. Patent URL: https://appft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PG01&p=1&u=%2Fnetahtml%2FPTO%2Fsrchnum.html&r=1&f=G&l=50&s1=%2220210406997%22.PGNR.&OS= DN/20210406997&RS=DN/20210406997

(Our reports provide factual information on research and discoveries around the world.)

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The best Reddit Penny stocks to buy right now? 5 trending stocks to watch today https://eventplaner.net/the-best-reddit-penny-stocks-to-buy-right-now-5-trending-stocks-to-watch-today/ Fri, 07 Jan 2022 21:07:35 +0000 https://eventplaner.net/the-best-reddit-penny-stocks-to-buy-right-now-5-trending-stocks-to-watch-today/

If you are looking for the best penny stocks to buy today, you have your choice. Social media has become the new “investor lunch table” for insight into stock market trends. This can lead to a lot of noise and confusion, especially if you are new to trading. Either way, it is very important to know where the trends start, why they started and if they are lasting. Today we take a look at a handful of the most active penny stocks on Reddit and other social opportunities.


Penny Stocks TL; DR Summary in 30 seconds

  • Penny stocks are among the most actively traded stocks on the stock market today
  • They attract thousands of traders per week based on different trends
  • One of the biggest trends in the stock market today is what’s happening on social media
  • Today we take a look at some of the most talked about penny stocks on Reddit and other social media today. Will they push higher on this wave of interest?

Social media has become the Mecca of retail traders, and rightly so. Companies like AMC and GameStop got their “meme stock nickname” from the groundswell that top subreddits created last year. Now, it’s common to see cheap stocks record explosive gains on a daily basis. Today we take a look at a few penny stocks to watch with increasing popularity on Reddit and other social media.

Reddit Penny Stocks To Watch

  1. SeaChange International Inc. (NASDAQ: SEAC)
  2. Creative Medical Technology Holdings (NASDAQ: CELZ)
  3. Diversified Healthcare Trust (NASDAQ: DHC)
  4. IMAC Holdings Inc. (NASDAQ: IMAC)
  5. Quoin Pharmaceuticals Ltd (NASDAQ: QNRX)

1. SeaChange International Inc. (NASDAQ: SEAC)

Social media, as an industry, is what put SeaChange International in the spotlight. With the rise of apps like TikTok, the competition has become fierce. One of the stars, Triller, initially made waves by speculating that it may go public or go public in the future.

Take it a step further and we have SeaChange International in the Triller headlines. Specifically, SeaChange has confirmed that it has entered into a definitive agreement and a merger plan with Triller Holdco. The goal is to advance digital advertising with TrillerVerz and, according to the company, the deal is expected to produce a combined company valued at around $ 5 billion.

Read: Penny Stocks, Pelosi & 3 Government Officials Buying Cheap Stocks Now

With the deal expected to close this quarter, attention has shifted to the stock following the decline in late 2021. In addition to market action and social media attention, there is other things including SEAC as a stock with higher short term interest. Short Squeeze Penny Stocks have become a popular topic of discussion among retail traders. Based on the latest data from Fintel.IO, the short float percentage is currently around 13%.

2. Creative Medical Technology Holdings (NASDAQ: CELZ)

Creative Medical’s actions have been hot since early December. As we discussed in the article “Low-float stocks to buy for less than $ 5 after a 250% increase in RELI”, the company’s recent update to the Nasdaq seems to have turned some heads. The regenerative medicine and stem cell technology company is developing a pipeline targeting multiple indications. These include neurology, urology, orthopedics, and immunotherapy.

While things have been calm in the New Year so far, the momentum remains in play after its Nasdaq IPO. In addition, the latest focus on Creative’s stroke candidate, ImmCelz, may also have become a focus. New data was released last quarter showing an ability to “reprogram” immune cells.

“The data disclosed today suggests the ability of ImmCelz ™ to achieve superior results in a manner that lends itself to safe, scalable and rapid clinical translation,” said Dr. Camillo Ricordi, member of the Scientific Advisory Board of the society. In addition, ImmCelz ™ has already been shown to be effective in animal models of autoimmunity. It is currently the subject of a pending IND filed by the Company with the FDA to treat stroke victims. As the market waits for more details on the NDA, CELZ stock has traded higher this year.

Best penny stocks to buy Creative Medical Technology Holdings CELZ stock chart

3. Diversified Healthcare Trust (NASDAQ: DHC)

Shares of Diversified Healthcare have collapsed since mid-December. The company’s model is simple. As a real estate investment trust (REIT), the company owns high quality healthcare properties in the United States. It has a $ 8.2 billion portfolio with over 390 properties in 36 states and Washington, DC Diversified Health is also managed by the RMR Group (NASDAQ: RMR), which is an alternative asset management company.

Before the start of 2022, there are a few things under scrutiny right now. First, income could be a sticking point for some. It comes after mixed third-quarter results sent the DHC title into a downward spiral in November. The company missed out on earnings per share and sales. However, the failure could have been attributed to a period of transition in the company.

Addressing this, Jennifer Francis, President and CEO of Diversified Healthcare Trust, said: “In the third quarter, we made substantial progress in shifting the management of a number of our senior communities to from Five Star to new third-party managers… we have signed new management agreements for 107 communities in transition, and 99 of these communities have been transferred, with the hope that the remaining eight will be transferred by the end of the year.

Interestingly, with the next round of expected quarterly and annual earnings, analysts appear to have turned bullish on DHC stock. B. Riley raised its price target on Diversified Health just before the end of 2021. The company has a buy on the stock and raised its $ 5 target by 20% to $ 6.

Best Penny Stocks To Buy DHC Diversified Healthcare Trust Stock Chart

4. IMAC Holdings, Inc. (NASDAQ: IMAC)

Since the start of the year, the IMAC title has been one to watch. It started trading around $ 1.10 and has since climbed to $ 1.49. The health and wellness center management company has focused on expanding its “The Back Space” retail centers more recently. In a recent fourth quarter update, CEO Jeffrey Ervin spoke in more detail.

“We are delighted to continue our progress in opening new ‘The Back Space’ locations. We have set up a platform to provide affordable spine health and wellness services in a superior location … As we run the ten store pilot, we have identified several opportunities to ” improve subsequent store openings, which will reduce time to completion and cost of opening. Our well-established construction process generates high value and will be a benefit beyond the pilot program if we increase the number of our stores. “

Read: The Best Penny Stocks For Your January Watch List, 3 To Check Out

Looking ahead, next week could be important for IMAC. The company participates in the BIOCONNECT conference in HC Wainwright. Jeffrey Ervin will be present at the event which will take place between January 10 and 13.

best penny stocks to buy IMAC Holdings IMAC stock chart

5. Quoin Pharmaceuticals Ltd (NASDAQ: QNRX)

Thanks to analysts, specialty pharmaceutical company Quoin Pharmaceuticals Ltd was in the spotlight at the end of the week. The Maxim Group launched a cover on the company with a purchase note. The company also gave an initial price target of $ 5, which is over 100% above current trading levels right now. This is the latest in a series of analysts’ notes on the company. Last month, JMP Securities launched a hedge on Quoin with a market rating and a target of $ 8.

One of the recent initiatives that may have sparked this optimism is the company’s QRX003 treatment candidate for a genetic condition known as Netherton syndrome. Quoin has signed exclusive licensing agreements with AFT Pharmaceuticals, Genpharm Services and Orpharm LLC for the treatment. AFT provides access to the marketing of QRX003 in Australia and New Zealand. Meanwhile, Genpharm is expanding its reach to the Middle East and North Africa, with Orpharm working exclusively in Russia and the Commonwealth of Independent States in this region.

With the latest exclusive deals and bullish outlook for analysts, QNRX could be one of the Reddit penny stocks to watch at present.

Best Penny Stocks to Buy Quoin Pharmaceuticals QNRX Stock Chart

Reddit Penny Stocks

If you’re like most, Reddit, Twitter, Facebook, TikTok, and other platforms are quick ways to see what the masses are talking about. With this can come a lot of information. The usefulness of this information can be difficult to determine, but it certainly impacts the hype factor of trading. For this reason, always be sure to do your research to determine the best course of action, if it is time to buy penny stocks or avoid certain stocks altogether.


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Midam Ventures, LLC | (305) 306-3854 | 1501 Venera Ave, Coral Gables, Florida 33146 | news@pennystocks.com

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