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If you are an investor who loves to look at under the radar sectors as a way of getting an upper hand, consider looking at the often overlooked marine harvesting industry as a burgeoning source of global food moving forward. Mowi, previously known as Marine Harvest, trades on the Oslo Stock Exchange in Norway under the ticker symbol OSE: MOWI as well as on the OTC market in the United States under the ticker symbol OTCMKTS: MNHVF, meaning North American investors do have an opportunity to invest in the company.
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Mowi’s stock has surged over the past year and is currently trading at right around the 52-week high at a price level of 212.20 NOK. The stock has gained over 30% during the past 52-weeks, and offers a nice 1.39% dividend yield to its shareholders. Mowi has commercial seafood harvesting operations around the world including Norway, Scotland, Canada, Ireland, and Chile, and owns a 25-30% market share of the global trout and salmon harvesting industry. This makes Mowi the largest farmed fish harvesting firm in the world!

The Bullish Case: As world dietary preferences continue to evolve and move away from red meats, the demand for plant-based and seafood products has become higher than ever. Despite being a healthy source of Omega-3 essential fatty acids as well as a long list of other nutrients that are vital to human health, it is estimated that only 2% of the world’s current food supply comes from the oceans. That is a massive total addressable market that Mowi has before it, although investors do need to take into account that currently there are quite a few cultures that do not regularly eat seafood as a part of their regular diet. Aquaculture also has a distinctly low carbon footprint which makes it an environmentally sound way of producing food, unlike free-range or grass-fed cow farming. Mowi even breeds its own broodstock which are mature fish used in mass breeding, to help sustain the large volume of fish needed to harvest. Mowi reported a turnover of 3.8 billion Euros in 2020, and are well positioned for global growth heading into the future.

The Bearish Case: There is growing criticism of farmed fishing as mass produced forms of food manufacturing, that brings into question if nutritional value is sacrificed. Multiple different diseases and viruses have caused many farms of fish to have to be killed for fear of spreading to humans via consumption.

To combat this, Mowi has been caught dumping things like antibiotics and insecticides into the oceans, which cause damage to the marine ecosystems. This has resulted in local governments retracting certain fishing licenses including one that may affect Mowi’s ability to fish and harvest in Canada in 2022.

Final Verdict on Mowi: Mowi certainly has a nice industry moat and a product that is in high demand around the world. For the global leader in farmed salmon, halibut, and trout, amongst others, the stock is reasonably priced with a decent operating and profit margin already in place. The balance sheet could be better, as Mowi carries a lot of debt for a company that is so well established in its space. Still, Mowi has a tremendous opportunity moving forward as long as it continues to execute in an ethical way that does not endanger local wildlife. At its current valuation, Mowi is a great investment for the future, especially considering it pays a healthy dividend as well. 

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