Analysts at Noble Capital Markets have repeated their ‘Market Perform’ rating on MustGrow Biologics Corp. (TSX-V:MGRO, OTCQB:MGROF) after the company received registration approval for its biofertility product TerraSante in Arizona.
The approval allows MustGrow to commence TerraSante sales in the state, which produced $3 billion in total agricultural crop products in 2022.
“With the amount of farms over the state, with some farms being organic, and variety of crops being grown, we believe there is opportunity to be had for MustGrow to market its TerraSante product,” analysts wrote in a note to clients.
The analysts noted synergies with California, another state where MustGrow holds registration approval for TerraSante.
“Arizona's approval is key with the company's commercialization strategy with BioAg Product Strategies,” they wrote.
“In the winter months, agriculture companies in California use the winter climate in Arizona for its winter farming production. We believe that the company can 'double-dip' in potential sales to farming companies looking to use MustGrow's products for both California and Arizona, providing increased revenue.”
The trend of state approvals is not seen stopping with Arizona, as MustGrow expects to continue its efforts towards state-level registrations in other states with a focus likely on the Mountain Northwest and West.
“As the company continues to add states to its OMRI certification, we believe the quicker the company will add to its list with further approvals,” they wrote.
Analysts concluded: “We believe substantial opportunity exists for natural alternatives in the company's targeted end markets, such as preplant soil fumigation, bioherbicides, postharvest food preservation, soil amendment, and biofertility.”