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CannTrust Holdings (CNTTF)

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Last Post: 10/18/2018 11:16:24 AM - Followers: 33 - Board type: Free - Posts Today: 0



As a federally regulated licensed producer, we bring more than 40 years of pharmacy and healthcare experience to the Medical Cannabis industry and apply this expertise to produce standardized Medical Cannabis for patients in need as we sell 100% pesticide free product.

At CannTrust™ we are committed to research and innovation, as well as contributing to the growing body of evidence-based research regarding the use and efficacy of cannabis. Our product development teams along with our exclusive Pharma partner Apotex are diligently innovating and developing products that will make it easier for patients to use Medical Cannabis today and in the future. We support ongoing patient education about Medical Cannabis, and have launched a compassionate use program to support patients with financial needs.
Our 50,000-square foot state-of-the-art hydroponic facility provides control and results, combined with a patient-centric focus, ensures we are producing quality products and delivering superior service to our customers. To satisfy the demand for our products, we are expanding our production capacity with a 430,000-square foot greenhouse in the heart of the Niagara region. The facility has been designed and engineered to ensure our customers have a continuous supply of quality standardized products. This facility will be the first of its kind in Canada, one of the largest in North America, and the first phase will come on-stream in fall 2017.

Our onsite laboratory with advanced technology and equipment for testing and research on the medical use of cannabis provides CannTrust the ability to develop and rigorously test our products at any point. CannTrust has been granted a Section 9 License by Health Canada under the Narcotic Control Regulations. This allows us to expand our product development and research to include pharmaceuticals in an effort to better serve all Patients and Customers.

Taking Top Pick Target Up - ECHLON

Event: We reiterate our Speculative Buy rating as well as our Top Pick classification, and are raising our 12-month target price from $6.25/shr to $15.00/shr. When we originally launched coverage, we noted that our estimates and target price reflected baseline forecasts that had significant upside potential. We have increased our F2019 revenue/EBITDA estimates to reflect the benefit of the planned Phase 2 expansion, which we view as fully funded following the Company’s recent equity financing (co-led by Echelon Wealth Partners). Since it began publicly trading on August 21st, TRST has been one of the top performing cannabis stocks in our tracking group, with a return of 173% against the group average of 78%. Potential catalysts include improved financial results, additional product development news and the granting of a sales license for the Niagara facility.

Investment Thesis: CannTrust Holdings is a licensed producer (LP) of medical cannabis, operating a hydroponic indoor production facility in Vaughan, Ontario, and a greenhouse facility in Fenwick, Ontario. For additional detail, please refer to our recent initiating coverage report.

???$20M Equity Financing Closed; Doubling of Niagara Capacity Fully Funded– CannTrust recently completed a $20M bought deal private placement (including full exercise of the overallotment) at $5.00/shr. This was originally announced as a $15.0M offering, but was increased given strong demand. The Company has also arranged a $15.0M mortgage on its Niagara Greenhouse facility, and we expect the lender’s credit committee to approve the mortgage shortly. We therefore believe the Phase 2 expansion is fully funded, allowing TRST to double annualized production capacity at the Niagara facility to 40,000kg by mid-2018.

???TRST Reported Strong Q317 Results, and Initial Shipments to Australia – TRST reported revenue/adjusted EBITDA of $6.1M/$1.2M, beating our original forecast of $4.8M/ ($0.8M). The revenue outperformance was driven by sales volumes that beat our estimate by 26%, with both dried cannabis and cannabis oil sales volumes better than expected. As of late last week, TRST had 35,000 active patients. Moreover, the Company recently received Health Canada approval to export medical cannabis; shipments to Australia have begun, and management expects to soon begin shipping to Germany, Denmark and Brazil.

???Capacity Increase Drives Near Doubling of F2019 EBITDA Forecast to $111M – The Phase 2 expansion should double annualized production capacity at the Niagara facility from 20,000kg to 40,000kg, with completion expected in mid-2018 (our model assumes first harvest in late 2018). This is the primary driver behind the increase in our F2019 EBITDA estimate from $57M to $111M. Absent any change in the valuation multiple (10x EV/2019E EBITDA), this would justify a target price of $11.50+. However, as the group average multiple has doubled since we initiated coverage in late August, we are increasing our valuation multiple to 13x EV/2019E EBITDA, and are raising our 12-month target to $15.00/shr from $6.25/shr.

???Our Estimates Leave Significant Upside for Better Utilization and Stronger Yields – Should F2019 production reach full utilization (vs. our 70% forecast), our EBITDA estimate and 12-month target price would improve to $154M and $21/shr, respectively. Should crop yields outperform on top of that, our EBITDA and 12-month target prices could improve to $225M and $30/shr, respectively.

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#94   On my radar, but I have no dry power!! JohnCM 10/18/18 11:16:24 AM
#93   I have been buying all year on this Deehrm29 10/18/18 10:32:22 AM
#92   Got your pm 53man but I don’t have Dogger05 10/17/18 07:17:27 AM
#91   Interesting. Still grey? JohnCM 10/17/18 01:32:33 AM
#90   This company is a sleeping giant imo Dogger05. 53man 10/16/18 07:42:45 PM
#89   One day it will be flying all over Dogger05 10/15/18 09:29:22 PM
#88   100 % agree with you! This company flies 53man 10/15/18 08:47:40 PM
#87   I am very happy with this stock and JFoy 10/15/18 07:04:44 PM
#86   Another great day slow and steady! 53man 10/15/18 06:39:43 PM
#85   CannTrust tweet: Voting for the #CanadianCannabisAwards is well timetravelerdos 10/12/18 09:35:07 AM
#84   One of my fav charts. SeaTrue 10/11/18 09:19:21 PM
#83   Nice Green Day while others saw red wish 53man 10/11/18 06:18:53 PM
#82   Good article CannTrust a better buy than Canopy? timetravelerdos 10/11/18 11:50:36 AM
#81   tweet today saying $21 sp coming tweet timetravelerdos 10/11/18 11:38:01 AM
#80   This stock is on the grey market, so TraderJoe03 10/08/18 09:38:50 PM
#79   Bc it was a holiday in Canada today Thanksgiving 53man 10/08/18 07:50:39 PM
#78   Can anyone tell me why i have no Bracpacker 10/08/18 07:38:03 PM
#77   That’s a good problem....good luck to you too pal Dogger05 10/07/18 11:54:56 PM
#76   I was thinking tax wise. If it went 53man 10/07/18 06:35:41 PM
#75   Wish I could help you pal, but I’m Dogger05 10/07/18 06:22:17 PM
#74   My question to you though is I want 53man 10/07/18 04:58:43 PM
#73   I like the multiple partners also and don't 53man 10/07/18 04:53:48 PM
#72   No I don’t think acb could swallow another Dogger05 10/07/18 09:42:27 AM
#71   You don't think ACBFF would go after them 53man 10/06/18 06:55:59 PM
#70   Thanks for sharing that Dogger05. 53man 10/06/18 06:52:27 PM
#69   Expected as much but great to have it Jaymeinnyc 10/05/18 11:04:19 PM
#68   This looks pretty good... Dogger05 10/05/18 11:02:11 PM
#67   holding strong today - good Green timetravelerdos 10/03/18 02:00:52 PM
#66   such a good stock. very profitable. got to timetravelerdos 09/29/18 02:44:51 PM
#65   Great day for Cann Trust! 53man 09/28/18 08:09:20 PM
#64   It is indeed a quiet board Jaymeinnyc 09/25/18 07:28:25 PM
#63   We need a spot light on CNTTF irishiam 09/25/18 03:45:08 PM
#62   CNTTF Come lets get this board going! I irishiam 09/25/18 03:41:48 PM
#61   Why such a down day today when the 53man 09/24/18 08:33:57 PM
#60   Looking really good here today. Ohiostockpicker 09/19/18 10:13:08 AM
#59   Good read thanks Ohio. 33Sailor 09/18/18 04:59:10 PM
#58   CannTrust Makes History with First Shipment of Cannabis Ohiostockpicker 09/18/18 12:48:41 PM
#57 Ohiostockpicker 09/18/18 06:44:09 AM
#56   All these pot stocks are making beverage big Ohiostockpicker 09/17/18 11:37:08 AM
#55   Who told you that? Major Baker 09/16/18 03:55:08 PM
#54   WE GOT DIAGEO DEAL !!! Att_for_life 09/15/18 12:23:16 AM
#53   We shall see. singhinvestor16 09/13/18 12:42:53 PM
#52   Breakthrough thinks it's worth $10.23/share. 33Sailor 09/13/18 10:35:48 AM
#51   Thanks Dogger this company looks strong with a 53man 09/12/18 09:02:04 PM
#50   Well I look at the tilray valuation and Dogger05 09/12/18 08:31:48 PM
#49   We're lookin good... 33Sailor 09/12/18 08:19:30 PM
#48   Dogger05 I took a small position in the 53man 09/12/18 06:40:40 PM
#47   I agree and I think the attention is canadiancannaexpert 09/12/18 04:13:38 PM
#46   It's proven it's value with this deal. 33Sailor 09/12/18 11:14:46 AM
#45   Really good article! I think this will hit Ohiostockpicker 09/12/18 10:50:01 AM