For many investment themes, 2020 was scary, and then 2021 said, “Hold my beer.” But, while early year results have so far failed to live up to high vaccine-driven expectations, some areas of the market are powering ahead.
One of the most prolific performers is the cannabis space, where its lead ETF, the ETFMG Alternative Harvest ETF (NYSEARCA: MJ), is up over 30% already this year. But analysis on the political front following the Dem takeover of all branches of government suggest this simmering momentum could boil over in the months ahead.
As such, we highlight some of the more interesting names in the cannabis patch, including: Trulieve Cannabis Corp (OTC US: TCNNF), MedX Holdings Inc. (OTC US: MEDH), and Sundial Growers Inc. (NASDAQ: SNDL).
Trulieve Cannabis Corp (OTC US: TCNNF) is a vertically integrated “seed to sale” player operating as the first and largest fully licensed medical cannabis company in the State of Florida.
Trulieve cultivates and produces all of its products in-house and distributes those products to Trulieve branded stores (dispensaries) throughout the State of Florida, as well as directly to patients via home delivery.
Trulieve Cannabis Corp (OTC US: TCNNF) just announced that it has been awarded a four dispensary permits by the West Virginia Office of Medical Cannabis. In addition, Trulieve’s Pennsylvania acquisition, Solevo Wellness, was awarded three permits. The dispensary selection adds to the processor permit issued by the state in November 2020.
“We are excited to have these four dispensary permits awarded and to add to the processor permit already granted by West Virginia,” said Kim Rivers, CEO of Trulieve. “We are looking forward to expanding into our sixth state this year. Trulieve’s mission has always been to provide the highest level of cannabis products and customer experience through authentic and reciprocal relationships with its customers and patients. The dispensaries will further support that mission by introducing new patient populations to the Trulieve brand and offering relief they can rely on through the Company’s safe, quality products.”
Even in light of this news, TCNNF has had a rough past week of trading action, with shares sinking something like -8% in that time. That said, chart support is nearby and we may be in the process of constructing a nice setup for some movement back the other way. Shares of the stock have powered higher over the past month, rallying roughly 27% in that time on strong overall action.
Trulieve Cannabis Corp (OTC US: TCNNF) managed to rope in revenues totaling $181.6M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 94.4%, as compared to year-ago data in comparable terms. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($258.3M against $127.1M).
MedX Holdings Inc. (OTC US: MEDH) is a more speculative opportunity on this list. But that also adds up to opportunity because it’s future growth potential has been less well priced into shares. And, in this red-hot space, that represents an important idea that deserves some attention.
The company is focused on driving growth through vertical integration, strategic partnerships, licensing, franchising, and providing solutions to the emerging hemp and cannabis industry, and its recent reboot could provide an interesting bargain scenario before the crowd spots it.
MedX Holdings, Inc. (OTC US: MEDH) recently issued a corporate update and outlook against the backdrop of the January 2021 legislative session in Texas. According to the company’s release, currently, 15 states and Washington D.C. permit marijuana for adult recreational use, while 36 states allow it for medical purposes. In other words, MEDH is playing in a prepotent context.
“We hope to complete our plans to merge and acquire internal and external brands and entities in Q2 and throughout the remainder of 2021,” stated MEDH CEO Hans Enriquez. “We look forward to a favorable outcome of the legislative session and expect expansion to the hemp and medical program in Texas. We are excited to execute our operational strategies in 2021 and prepare for the next phase of growth.”
The stock is running on strong upside momentum as the crowd finds it, with shares up about 200% since late December.
MedX Holdings Inc. (OTC US: MEDH) just regained OTC Markets access, got its last three periods of quarterly filings caught up, and achieved Pink Current status. That now sets up a rebirth situation. MEDH could be set to push out new catalysts in a fresh corporate context just as it starts to get noticed in a hot thematic market theme.
Sundial Growers Inc. (NASDAQ: SNDL) is a licensed producer that crafts cannabis using state-of-the-art indoor facilities. The company cites its ‘craft-at-scale’ modular growing approach, award-winning genetics, and experienced master growers as the factors that set it apart from the competition in the rapidly growing cannabis space.
Sundial’s brand portfolio includes Top Leaf, Sundial Cannabis, Palmetto and Grasslands. Our consumer-packaged goods experience enables us to not just grow quality cannabis, but also to create exceptional consumer and customer experiences.
Sundial Growers Inc. (NASDAQ: SNDL) most recently announced that it has launched high-quality cannabis derivative products under the Top Leaf brand in response to rising consumer demands for solventless cannabis extracts. This most recent launch is consistent with Sundial’s focus on premium inhalables, following branded retail offerings of flower, pre-roll and vape cartridges.
“We made a strategic decision to produce these premium products based on demand for solventless, flavorful, pure, and potent cannabis concentrates from a growing group of consumers,” said Andrew Stordeur, President and Chief Operating Officer of Sundial. “Our control of the entire manufacturing process from cultivation to extraction enables us to deliver premium quality products on a consistent basis. Adding bubble hash and other advanced concentrates to our product portfolio will expand Sundial’s share of this rapidly expanding market segment.”
The context for this announcement is a bit of a bid, with shares acting well over the past five days, up about 102% in that timeframe.
Sundial Growers Inc. (NASDAQ :SNDL) managed to rope in revenues totaling $9.7M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of -62%, as compared to year-ago data in comparable terms. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($19.7M against $76.6M, respectively).
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