I've actually decided against building a position in this one for now. I like SS and it was good that a/s sits at 90 million. There are still a handful of issues that I have here though...
-Cash on hand went from $3.6 million to 277k in a matter of 2 years. That's not the best management right there.
-CEO Todd Denkin made nearly half a million in total compensation last year. That is very generous for a company still bleeding cash.
-Shareholder value is now basically a third of what it was in 2015. 11mm o/s to 31 o/s. That dilution rate isn't terrible but also nothing to write home about. I understand that it is alternative to taking on long term debt but it also pretty much throws shareholders under the bus. Now that the cash has run out, it could start ramping up quickly.
-TNM is just a silly side gig that should be cut out of the company at this point. I get how it can help a bit with marketing but seriously, focus should be solely on MJ testing already.
-Past endeavors have not exactly panned out... The company "tried" to expand into Colorado but failed. Now there is the deal with OC Testing LLC but pretty much anyone could set up an LLC for very cheap so I'm not entirely convinced on its validity yet.
-Lastly, I have a bit of a complaint. Change the ticker symbol and name of this company already! If those two things were at all marijuana related, this stock would probably see at least 2x trade volume.
I do believe this is a legitimate company, but I'm out until I can reassess the share structure next time to see what the rate of dilution will be with low coffers and until I see some sort of actual progress on a physical testing facility outside of Nevada... Curious to hear if anyone has anything to chime in though...
