SLEEKSCAPE'S 2022 CANNABIS & MARIJUANA MANIA GRAND SALAMI -- PART II

[sleekscape]

MJTK REVIEW, CURRENT PERSPECTIVE AND FUTURE OUTLOOK

When I announced MJTK as a 4/20/17 SALAMI stock pick on 1/12/17, it was trading at $.0017 with 457M shares outstanding, giving it a market cap of only $800,000

Given the state of the MJ sector at that time, where over 97% of pot stocks with a summer 2016 SALAMI score greater than the median had already experienced bigtime runups -- many achieving several hundred to several thousand percent gains during fall 2016 -- MJTK stuck out like a sore thumb, possessing the highest SALAMI score of all marijuana stocks by a wide margin

Despite the fact that MJTK was only about 50% of the way through its recapitalization and its resultant ongoing dilution, its shares had been under heavy accumulation for the prior 6 weeks -- sustaining itself very well around the .002 level with impressive dollar volume

At the same time, the MJ sector was clearly experiencing an impressive January effect as it shook off the post-Trump election hangover.
Even fully diluted, at its apparent base of .002, MJTK's valuation remained under $2M -- compared to the rest of the sector, it was massively undervalued.

Based on a comprehensive survey of other stocks with similar characteristics, along with the continued bullishness of the MJ sector and the projected launch of CITIZEN TOKE in March, I developed a model for a market capitalization of $30M-$50M by 4/20/17.
This post offered a brief snippet on MJTK's near-term valuation potential: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=128621928

The company itself had a bevy of attractive qualities -- CEO Michael Tew's software and finance background, his intelligence and work ethic, business partnerships with Duby, OpenVape and Betakillers, the business vision to acquire a game-changing software product that would address the biggest weakness in the retail sector -- marketing/advertising -- and the savvy to launch the Groupon of weed, CITIZEN TOKE, as a joint venture with very successful partners

I was pretty shocked when MJTK launched over 1000% in only 2 trading days after I announced the pick, hitting a peak of $.0194 intraday before closing at $.0124

During the first full day of trading, MJTK traded 469M shares, more than its entire outstanding share count

This was completely unprecedented

A retrospective analysis of the factors that caused such a mammoth explosion turned up the following:

Rare opportunity to get in on the ground floor of a promising company with a comparatively tiny valuation and the 3-day weekend due to MLK after the announcement enabled folks plenty of time to do their DD

Considerable buying pressure was generated by those that closely followed the success of THE 2016 ELECTION GRAND SALAMI

Financiers and MMs had an enormous short position due to convertible debt, which caused a massive short squeeze

This sudden explosion in stock price created an unsustainable runup

MMs and financiers reshorted above .01 and the tail end of the dilution and a typical Fibonacci retracement led the stock to dip to .0056

Tew decided to tap the credit line in early February to raise $150,000 and the stock subsequently bottomed out at .0052

The final conversions from the recapitalization took place between 2/13-2/15

Kodiak received 73M shares priced at .0004 on 2/13, when the stock was trading at .008, representing an increase in value of 2000%

During the period represented by the 2nd and 3rd week in February, due to a combination of retail buying and institutional short covering, the stock turned green on 8 out of 9 days, climaxing with a 50% gain on 105M in volume -- now at $.0155, MJTK had tripled in just 2 weeks

At the .0155 level on 2/22, MJTK was now up 800% from the initial call at .0017 on 1/12 -- and with the dilutive phase now over and the long-awaited launch of CITIZEN TOKE within reach -- seemingly well on its way to the projected price target

The very next day, on 2/23, Sean Spicer made the infamous comments about the Trump administration's greater enforcement of recreational marijuana, which turned out to mark the high point for not just MJTK, but the entire MJ sector in general -- and as we all just witnessed in March and April, quelled any 4/20 run before it could get started.
Click on "United States" index and look at the 6 month chart:
https://marijuanaindex.com

Though Spicer's comments took the air out of the sector and subsequent comments from Sessions served to further reinforce the uncertainty surrounding MJ stocks, as we moved through February and into March, several positive developments unfolded for MJTK

On 2/27, Kodiak filed a Form 13G, which showed that they hadn't sold a single share they received during their final conversion in mid-February

So even though Kodiak was up 2000% on the 73M shares they received on 2/13, and watched their value double to 4000% during the runup to .0155 on 2/22, they refused to sell

In essence, Kodiak turned down the opportunity to sell MJTK at a 4000% profit and instead went long on 73M shares -- given the fact that they know more than anybody else about the internal workings of MJTK, there aren't any other signals more bullish about the future prospects of an OTC stock than that

On March 2nd, Kodiak displayed another act of confidence in MJTK by increasing its credit line from $1M to $3M

During the month of March, MJTK spent most of the time in the familiar trading range of .008-.01

By the end of March, it had been nearly 3 months since MJTK entered the 4/20/17 SALAMI, and for much of that period, the prevailing sentiment amongst MJTK investors was one of puzzlement -- why was Tew remaining so quiet on the PR front in the midst of a newly huge shareholder base that was as excited about the prospects of CITIZEN TOKE as they were worried by the ongoing silence from the company?

At the very end of March, the answer to that question was finally delivered in resounding fashion as MJTK announced its intent to acquire AFN for their EXPO software product, an application that seeks to become the PayPal of weed -- this marked the end of CITIZEN TOKE as a standalone app in favor of its total integration with EXPO

Despite putting in hundreds of hours of DD, I never uncovered the AFN acquisition, which led to a delay in the launch of CITIZEN TOKE and an embargo on any company news.
This is a tremendous credit to Tew, who remained extremely tight-lipped in the midst of immense shareholder pressure to release news -- though I repeatedly attempted to connect with him to extract some additional information, he continually rebuffed me by saying "Everything is in the filings."
In an ironic twist, though I felt frustrated by his silence and refusal to offer any additional commentary, I also felt more comfortable with my investment in MJTK, as nearly all OTC executives with which I have spoken have always talked up their stock.
Mr. Tew is a very rare breed in the OTC CEO kingdom, indeed.

The market for EXPO is much larger than the market for CITIZEN TOKE, in the same way that the market for PayPal is many times larger than the market for Groupon -- while the former app can potentially be utilized for every single retail transaction, the latter is designed to be used for deals, which comprise only a portion of all transactions -- a hugely significant fraction, given the lack of substantial progress in the MJ marketing/advertising space, but a fraction nonetheless

So the acquisition of AFN/EXPO was a titanic move; it also explains the delay in the launching of CITIZEN TOKE and the long quiet period that lasted from early November through late March, nearly 5 months without a press release concerning corporate activities inside MJTK -- unfortunately in the OTC marketplace, 5 months of silence can often feel like 5 years, especially to shareholders appropriately hungry for information who have grown wary of MJ scam stocks

The plan was always to synch some type of banking protocol with CITIZEN TOKE to enable payment -- this is clearly stated in the 8-k describing the acquisition of CITIZEN TOKE, along with the projected launch date (beginning of revenue generation) 3 months after the initiation of the beta trial -- so with the announcement of the beta version commencement in late November, CITIZEN TOKE was slated to launch in March

Only instead of partnering with some external financial company to provide banking/payment services for the CITIZEN TOKE transactions, Tew made the decision to bring this essential piece in-house by acquiring EXPO

The vast potential of EXPO as a standalone banking/payment application in the cash-filled retail cannabis market is obvious, but while the synergism with CITIZEN TOKE is absolute, it is also more subtle.
The biggest weakness in the concept of CITIZEN TOKE does not lie in the design of the application itself but in its implementation after a customer agrees to the text-messaged deal.

Without EXPO, dispensaries would have no way of ensuring that the agreed upon deal would be financially consummated because cash cannot be sent through a cellphone.
That leads to a situation where a store needs to reserve product for a customer with no guarantee he will show up to pay for it.
Given the fact that the majority of deals will be limited by the supply of product available, a dispensary would then be taking a chance by potentially passing up a sale to a customer who is actually shopping inside the store in favor of a customer who may or may not show up to pay for a product he has reserved through CITIZEN TOKE.

Risking passing up an in-store "sure sale" for an outside-store "maybe sale" is not the greatest business proposition.
EXPO completely eliminates this possibility because in conjunction with CITIZEN TOKE, the fully integrated software product is perfectly synergistic and the customer can agree to the deal and make the payment simultaneously, removing the risk to the dispensary of reserving a product for a no-show non-payer.

Based on the selloff we have seen in MJTK since that announcement, it is clear to me that the market doesn't understand the enormous significance of the EXPO acquisition.
And let me be clear -- I don't place the entirety of the blame for that on the market; instead, I feel that as great as Mr. Tew's business vision and planning may be, his biggest weakness is undoubtedly communication of this vision to the investment community.

Thankfully, that is not a chink in his armor that cannot be patched -- a detailed shareholder letter and a comprehensive conference call including extensive Q & A can go a long way towards elucidating the tremendous investment opportunity that MJTK offers MJ investors.
Hiring an outside PR firm and unveiling a new website would complete the overhaul and allow prospective shareholders to see MJTK as I see it -- a company that aspires to develop and implement 2 software products that brilliantly address the 2 biggest problems in the retail cannabis space -- marketing/advertising and payment.

Whether CITIZEN TOKE and EXPO actually become the Groupon and PayPal of weed remains to be seen, but having the chance to invest in a pre-revenue ground-floor opportunity with a completely refreshed balance sheet, a very small market capitalization, fantastic access to financing and the potential to completely disrupt the MJ retail sector in 2 different but synergistic ways is not an opportunity that I am willing to miss

Sleek