Good morning everybody.
You know those instances where a stock does something unusual and then it all makes perfect sense afterwards? Well, some of you may have noticed a lot of strength and some unusually high volume from featured stock Giggles N Hugs (GIGL) yesterday. All told, it gained 33% on Monday. The reason for the big move became clear today.
As a reminder, Giggles N Hugs is a brilliant, budding restaurant chain that combines a playground and a healthy kids menu in an environment parents can feel good about.
We've been comparing it to Chuck E Cheese, but we've also been conceding it's not a great comparison. Giggles N Hugs is so much more than Chuck E Cheese. Rather than lousy, unhealthy pizza and a restaurant that pulls kids away from playing video games at home only to have them playing video games at a restaurant, Giggles N Hugs offers climb-ons, bouncies, story-time, organized games, costumed characters and more.
While pizza is available at Giggles N Hugs, it's not the typical pizza you'll find at many of America's favorite pizzerias. Among its favorite pizzas are the veggie pizza and the gourmet pizza, topped with goat cheese, sun-dried tomatoes. Appetizers include hummus and bruschetta. The grilled salmon salad is also delicious, and eggplant parmesan is on the entree list too. The kids-oriented restaurant still offers more familiar fare, like burgers, but wraps, salads and fresh fruit smoothies are given as much love and attention as any other item on the menu, and gourmet mac-and-cheese displaces french fries.
It's not the kind of thing most kids would eat at home, but somehow children find a different palate in the right environment.
Better still, a huge chunk of its menu is made up of food that's fresh, locally-sourced, and organic whenever possible.
It's a savvy play on a trend that's been underway for a while now, but is still enormously undertapped.... healthier kids menus. And the demand is growing. Last month, the National Restaurant Association published its annual list of the top 20 trends expected for the industry in the coming year. Number seven was clear... "healthful kids menus."
In any case, based on the success of the first three Giggles N Hugs locales -- all at Los Angeles malls -- it's clear the demand for such eating options is strong, and growing.
This is all stuff those of you who've been following the GIGL story at the website know, though, as is the fact that the company has pretty much perfected the art of running this kind of establishment after opening the first one in 2008. The next natural step, then, is to expand its footprint by opening more locations. In fact, that's something we've been saying was in the cards since early October when GIGL was put back on our list of Featured Stocks. Specifically, we took the company at its word when it said it was looking to have twelve locations up and running by the end of 2017.
Those of you who are small cap veterans will know, of course, saying it is one thing, and doing it is another. Well, it looks like Giggles N Hugs is officially doing it.
The full press release is below. I'll just sum it up for you here -- Giggles N Hugs has hired Chardan Capital Markets, LLC to raise the money the company needs to start that expansion.
Some of you may recognize the name Chardan. Others may not. If you're not familiar with Chardan, just know it's one of the premier names in fund-raisers and loans for up-and-coming small cap companies. There's a reason it did the second-biggest number of PIPE (Private Investment in Public Equity) deals among all financial services outfits during the third quarter. It's the cream of the crop, and pretty much has its pick of clients. The fact that it chose to partner up with Giggles N Hugs speaks volumes about the caliber of opportunity Giggles N Hugs brings to the table.
The take-away for investors: If you didn't take Giggles N Hugs' expansion plans seriously before, take them seriously now.
There was something else I found in the press release you might find is a little curious... the company is talking about an uplisting to a senior exchange. I don't think I need to tell you what that could do for the stock.
And if there was any doubt Giggles N Hugs is going places, you only have to look at who it's got working for it now.
Ever heard of California Pizza Kitchen?
Those of you who know the California Pizza Kitchen story will also know the eatery has grown from one store back in 1985 to more than 230 locations now, and generates estimated annual revenue north of $500 million thanks to its frozen-pizza licensing deal. Philip Gay, the former CFO of California Pizza Kitchen and Wolfgang Puck Food Company, was largely responsible for much of that growth, as was John Kaufman, the former Vice President of Operations for California Pizza Kitchen. Kaufman actually joined the California Pizza Kitchen team back in 1986 when there was still only one restaurant, and he was there through the mid-90's, leaving after it was a 64 unit company.
Care to guess where John Kaufman and Philip Gay are working now? Yep... it's Giggles N Hugs. Kaufman is now the President, and Gay is the CFO.
My point is, between the Chardan news, the presence of Gay and Kaufman, the company outright saying it was looking to expand, a long history of growth, and serious talk of an uplisting, the high-volume breakout we saw from GIGL yesterday comes as no surprise. The only surprise to us would be if this didn't end up being a bullishly pivotal moment for the stock. There are just too many good things falling into place for Giggles N Hugs now.
Here's the press release. I'll let you decide what else the market could possibly be waiting for.
(Oh, and by the way, Giggles N Hugs will be presenting at this year's LD Micro Main Event Conference. It's slated to make a presentation on Thursday, December 3rd, at 4:30 PST. If you're anywhere near the area that day, it would be worth a visit.)
Giggles N' Hugs Signs Agreement with New York-Based Chardan Capital Markets
Los Angeles, Dec. 01, 2015 (GLOBE NEWSWIRE) -- Giggles N' Hugs, Inc. (OTCQB: GIGL), owner and operator of family-friendly restaurants that bring together high-end, organic food with active, cutting-edge play and entertainment for children, has engaged Chardan Capital Markets, LLC ("Chardan") a boutique investment bank headquartered in New York.
Under the agreement, Chardan will introduce Giggles N' Hugs to potential investors and business partners, advise and assist management in preparing for presentations to financial sources, as well as perform a wide variety of financial advisory services.
"We are extremely pleased to have reached this agreement with Chardan Capital Markets," said Joey Parsi, Founder and CEO of Giggles N' Hugs. "As we continue to grow and expand our reach in markets throughout the country and the world, we look forward to working with Chardan to assist in taking our company to the next level through their capital markets and financial advisory expertise. In addition, markets permitting, we plan to take the necessary steps to position Giggles N' Hugs for an up-listing to a national exchange in 2016."
Chardan specializes in providing the entire gamut of investment banking, trading and equity research, with a particular emphasis on micro-cap emerging growth companies. With over $13.0 billion raised through more than 250 transactions, Chardan has developed a successful record of completing a wide variety of deals. In the process, Chardan has become a leader on capital solutions for emerging growth companies.
About Giggles N' Hugs
Giggles N' Hugs is the first and only restaurant that brings together high-end, organic food with active, cutting-edge play and entertainment for children. Every Giggles N' Hugs location offers an upscale, family-friendly atmosphere with a dedicated play area that children 10 and younger absolutely love. We feature high-quality menus made from fresh and local foods, nightly entertainment such as magic shows, concerts, puppet shows and face painting, and hugely popular party packages for families that want to do something special. www.gigglesnhugs.com.
Forward Looking Statements:
Certain statements in this press release constitute "forward-looking statements" within the meaning of the federal securities laws. Words such as "may," "might," "will," "should," "believe," "expect," "anticipate," "estimate," "continue," "predict," "forecast," "project," "plan," "intend" or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to us on the date of this release. These forward looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including without limitation those set forth in the Company's filings with the Securities and Exchange Commission (the "SEC"). Thus, actual results could be materially different. The Company expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law.
INVESTORS RELATIONS CONTACT:
Bruce Haase
RedChip Companies, Inc.
800.733.2447, ext. 131
bruce-at-redchip.com
Joey Parsi
Founder/CEO
Giggles N Hugs
Joey-at-gigglesnhugs.com