Company Overview:

$HMBL - HUMBL Inc. (previously $TSNP – Tesoro Enterprises) is a digital commerce platform that was built for the purpose of connecting consumers, freelancers, and merchants within the digital landscape. HUMBL has adopted progressive technologies such as blockchain to streamline this process, while making their blockchain technologies easy to use. HUMBL has described their approach to simplifying blockchain technology and solutions for their customers similar to that of Facebook in the way that they used complex technology at the time and made it simple to use for their customers.

This approach to simplifying their blockchain technology so that anyone can use it is very important in terms of acceptance/testing this new technology. Currently, there are too many people who would not be able to keep up with the complex nature of crypto and blockchain technology, so making it simple and easy to use could help HUMBL greatly.

HMBL plans to use blockchain technologies to allow for both their merchants and consumers to participate in a digital economy. HMBL has 3 main (interconnected) verticals, which include HMBL Pay, HMBL Marketplace, and HMBL financial. HMBL believes that these 3 verticals will be vital for the participation of their customers and merchant in the digital landscape. These 3 verticals will be explained further in the “Vertical information” section of this report.

Investment Information:

Vertical Information:

As previously mentioned, HMBL has 3 primary verticals, these verticals include:

HMBL Pay: HMBL pay is a mobile app that allows for the connection of consumers and merchants in a digital economy. HMBL pay allows their customers to use digital currencies (cryptocurrencies) to pay for goods sold by the merchants. HMBL Pay is currently targeted at 3 main groups:
- Individuals (Consumers) – HMBL pay allows customers to have a fully digitalized experience from their payment to their reviews left on the seller.
- Freelancers – Service providers and freelancers can work from anywhere and can get paid anywhere thanks to the digital model HUMBL Pay is built on.
- Merchants – Vendors can get paid digitally, and from anywhere, which is favourable to them.
HMBL Marketplace: The HMBL Marketplace allows for the selling of soft goods and digital assets by incorporating the benefits of blockchain. Merchants can use the “HMBL Token Engine and “HMBL Origin Assurance” to authenticate, trade, and track their products. As part of their marketplace segment, HUMBL is introducing NFT’s (Non-Fungible Tokens) to monetize their digital images and content on the blockchain. HUMBL will work with their clients to create, list, and sell their NFT creations on a variety of NFT platforms.
HMBL Finance: HMBL Finance is developing digital investment markets for easy transactions. Currently, the digital asset market is a $2T market, and represents a huge opportunity for HMBL. HMBL is also looking into the possibility of “asset tokenization”, which would essentially bring the stock market onto blockchain technology. This would fix some liquidity issues that the current financial infrastructure faces, and theoretically allow stocks to be traded 24/7/365. HMBL has developer “Exchange Traded Index’s (ETX)” that allow their customers to invest in “baskets” of digital assets on the blockchain.
- UPDATE: In HMBL’s Q2 2021 disclosure, they announced that their BLOCK ETX products are launched and in over 100 countries. Furthermore, their BLOCK ETX products are compatible with Coinbase Pro, Bittrex US, and Binance US, and for their international customers their BLOCK ETX products are compatible with Bittrex Global.

Stock Ownership:

Through a quick look through HMBL stocks Yearly OTC disclosure, I found something rather interesting in their stock ownership breakdown.

Brian Foote (CEO and Director of HMBL): Foote owns 100% of the Series A preferred shares (equal to 7,000,000 common shares), almost 11% of the common stock (91,519,304 shares), and an LLC that represents Mr. Foote owns almost 38% of the Series B Preferred shares (equal to 2,497,090,000 common shares). If all of these shares were converted into common stock, then Brian would own 2,595,609,304 common shares. This would represent 51.91% of the total shares authorized as of December 31^st, 2020. This is a very large ownership and is somewhat worrying that 1 man owns all of these shares, as if he sells a somewhat large percentage of his shares, the stock could tank massively.
- UPDATE: In HMBL’s Q2 2021 quarterly report, they reported that (on June 30^th, 2021) they increase the total (common) shares authorized from 5B to 7.45B. This now means that is Mr. Foote converted all of his ownership into common shares, he would only now own 34.84% of the total common stocks authorized.

Investor Relations:

In both their Q2 2021, and their 2020 Annual disclosure, HMBL had nobody listed as a contact for their investor relations. I though that this was kind of weird given they are a stock (although an OTC stock) and should have someone in control of investor relations that can communicate with their group of eager investors.

Financial Information:

All financial information in this analysis comes from HMBL’s Q2 2021 disclosure.

Financial Performance (Good): HMBL has $5.3M in cash which is an increase of over 200% since the beginning of the year. HMBL has also reported their first balance in their accounts receivable, which totalled $140k. In Q2 of 2021, HMBL also purchased over $16K worth of NFT inventory which is very unique and could go very good or very poorly. Additionally, HMBL reported their first revenues of $382k, and their first gross profit of $238k.
Financial Performance (Poor): HMBL reported a net loss of $22.6M in Q2 2021, which was largely due to their jump in operating expenses. HMBL reported an EPS in Q2 2021 of -0.02

NFT and Digital Currency Information:

In their disclosure, HMBL reported spending approximately 16k on NFT’s. However, as I continued to read their disclosure, I found out some information on the increase in value of the NFT’s they purchased. In HMBL’s revenue breakdown, they reported over 18.1k in revenue from the sale of their NFT’s. Additionally, in their changes in assets and liabilities section, HMBL reported that they have over 4.1K still left in their NFT inventory. This means that their NFT’s rose in value from 16.4k to 22.2k, inferring a 35% increase in value.

Additionally, HMBL reported buying $98,535 in Ethereum earlier in 2021. The value of their Ethereum has since dropped and is sitting around $78,005. This implies that their Ethereum investment fell by over 20%. However, since this report in June, Ethereum has rallied over 41%, which should bring their Ethereum investment to $110k which implies an overall increase in value since their purchase of 11.6%.

2021 Stock Incentive Plan:

On July 21^st, 2021, HMBL established their “Stock Incentive Plan” for a maximum of 20M shares to be issued to promote long-term growth and profitability. This plan should help to increase output and growth through providing incentives to key personnel that are essential to the business. Furthermore, the plan will help HMBL attract/retain/reward the best available talent through the granting of their HMBL stock.

Acquisitions:

Tickeri:

On June 3^rd 2020, HMBL acquired 100% of Tickeri for $20M. Tickeri is a leading ticketing, live event, and box office SaaS (Software-as-a-Service) company. HMBL bought Tickeri for $10M in common stock, and $10M through promissory notes that yield 5% APY. Currently, HMBL is keeping Tickeri’s operations separate for the time being (at least until they pay out the promissory notes in full).

Monster Creative:

On June 30^th, 2021, HMBL acquired 100% of Monster Creative LLC for $8M. Monster is a Hollywood production studio that specializes inn the production of movie trailers and other promotional content. HMBL is using Monsters platform for the NFT portion of their business/operations. This acquisition was funded through $7.5M in convertible notes payable to Monster, and $0.5M in non-convertible notes payable to Monster (both notes yield 5% APY).

Recent (Significant) Press Releases:

Syndication Partnership with Ticket Evolution:

On August 27^th 2021, HMBL (HMBL Tickets) entered into an agreement with Ticket Evolution. This agreement will help HMBL to provide their users with lower costs, premium seating experiences, and a wide variety of available events. HMBL and Ticket Evolution are partnering to work on technology integration, marketing, sales, inventory, and customer support enhancements.

This is the first step HMBL has taken in the long process of migrating the sports/event ticketing market onto the blockchain via smart contracts. HMBL is collaborating with Ticket Evolution, and with their subsidiaries to make this process streamlined and synergetic.

$100M Share Retirement:

On July 7^th 2021, Brian Foote (HMBL CEO) retired 9,350 of his Series B Preferred Stock (equivalent to 93.5M common shares). These 93.5M common shares were worth approximately $100M as of July 6^th, 2021, closing price. Seeing the CEO retire his own shares for the benefit of their investors is a very good thing to see especially as the CEO of an OTC stock.

My HMBL Forecast:

I like HMBL's approach to integrating the blockchain in the way we make everyday transactions (ie. buying sports tickets). Futhermore, I like that HMBL has been steadily acquiring more copanies that provide synergy and take their business to the next level. Lastly, I think that HMBL is a very forward-looking business, I am saying this because thy have bought Ethereum and NFT's as assest for their business and I think that businesses like these have enjoyed better valuations from investors.

Overall, I am bullish on HMBL's business, and bullish on the crypto market/space, so naturally I think HMBL is a good buy. My HMBL forcast is $1.50 by the end of the year (December 2021).