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Bloomberg Intelligence now 70% odds on SAFE Banking while Cowen is up to 75%.
Bloomberg Intelligence now 70% odds on SAFE Banking while Cowen is up to 75%. We wanna read the safe harbor language if / when and I’m certain we’re not alone.
— Todd Harrison (@todd_harrison) November 21, 2022
🇺🇸 #cannabis 🌿 pic.twitter.com/rW3Q7v3BPw
SHWZ's R. Greenleaf Sunland Park Dispensary's grand opening (#13) announced per their emailed newsletter today.
SAFE is still on track. Will be introduced in December. Final language will likely be released before end of the month.
— Weldon Angelos (@weldon_angelos) November 19, 2022
Now that could be why Dye and possibly another insider scooped up shares. Like Colorado even if NM does get saturated with dispensaries management is very savy and will do just fine. I love the headlines "NM recreational sales soar"
Instead of the weak CRON rumor...to which CRON already has an equity stake in Pharmacann...I am gonna toss this (rumor) out there. What if the Brian Ruden stepping down was done just in time to have a BOD spot open for Congressman Ed Perlmutter? Ed is about to retire, he has always been an advocate for the industry and Colorado is home...actually according to Google he is from Lakewood CO, which is conveniently a stones throw from SHWZ headquarters. We all know he will end up somewhere. Why not with an up-and-comer from his own backyard?
https://www.reddit.com/r/SHWZ/comments/yz4syl/recreational_cannabis_sales_skyrocket_in_new/
Recreational cannabis sales skyrocket in New Mexico (11/15/22)
The following article on the New Mexico Recreational Cannabis market was published on November 15th, 2022:
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Recreational cannabis sales skyrocket in New Mexico (koat.com)
Recreational cannabis sales skyrocket in New Mexico
Despite rise in sales, oversaturation is a cause of concern for some.
Jessie Hunt, spokesperson for Schwazze said it's been a boost for the economy.
"We are continuing to see that people are coming into the legal market to purchase their cannabis, which is wonderful. That is exactly what we want to see in the state. We are able to continue to hire staff, pay strong wages in New Mexico and people really want to work in the industry, which is wonderful," Hunt said. "We are opening a few more stores. We're also trying to make sure that we're doing it in a way that is super responsible for the communities that we're in and that are in communities that really still have some high demand."
According to the latest data from the state's Cannabis Control Division, over $25 million in recreational sales was recorded in October — the highest it's been since the legalization of recreational sales in April.
However, there has been a decrease in medical sales.
Eli Goodman, CEO of Best Daze said while continuous growth is great for the cannabis industry, there may be challenges.
"The job growth is huge. I mean, companywide, our company alone has over 100 employees. We're moving through cultivation, manufacturing dispensaries. This is our eighth dispensary opened and we're one of many groups. So, there's a lot of opportunity, a lot of growth and a lot of jobs. That's positive for the economy, gets money in people's pockets and overall generates tax dollars for the state, and we need it right now as a state," Goodman said. "There's no limit on license around production, and there's a question — when does this market stabilize? Does it get saturated? Are there some people that are going to put money into businesses not be able to keep things going, because it's an oversaturated market — not be able to make it through that extension where they need some capital to keep it going."
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It is clear that the New Mexico Adult Recreational Market has been a boon for the sector and Schwazze is keen on gaining market share to grow with the industry growth with goals of ending this year with at least 16 to 17 dispensaries (versus there starting count of 10 at the close of the R.Greenleaf acquisition earlier in the year) and to have 25 dispensaries by September 2023 (as discussed in a recent interview (see link below for more details):
www.reddit.com/r/SHWZ/comments/ygryev/nms_cannabis_supply_steady_six_months_in_101422/
During the Q3'22 earnings call, management made it clear that the preferred method of dispensary growth in the New Mexico will be "organic" growth targeting key locations (e.g., Border Towns adjacent to Texas and other markets).
We believe that Schwazze, and its vertical integration strategy, will be key in outpacing the overall New Mexico market in growth (both same-store sales and through greenfield stores).
IRR
Agreed. The Reddit rumor regarding Cronos making a move on SHWZ is total BS.
Justin Dye has hinted at a big move for SHWZ but it will be organic, JD is not interested in giving up the reins on his baby. Dye is having way too much fun building his dream. All Justin has learned over the past 25+ years is driving him to pursue big dreams to match his big success throughout his professional career.
Mr. Dye is not your typical OTC CEO and his goal is so grand you will see SHWZ on a higher exchange in the near future. The stars are aligned perfectly for us, as JD has hit the point in his life where he is capable of making his dreams come true.
My prediction, my opinion, is that Brian Ruden will finally join his Star Buds enterprise with SHWZ. I think Dan Pabon has been working with the Oklahoma state legislature to fix the fundamental flaws that exist through the states wild west approach to cannabis. This would be a major deal and very organic.
https://oklahoma.gov/omma/rules-and-legislation/legislative-updates.html
https://www.usnews.com/news/politics/articles/2022-11-14/after-election-marijuana-advocates-look-to-next-states
It would be nice if all the insiders were adding on the open market, but take what we can get for now :)
Enjoy the weekend,
Knife
I would actually prefer another member of the leadership team stepping up and buying a boatload of shares - that might even send a bigger message at this point. But beggars can't be choosers... Love the rebound today, it was lovely.
I expect we will see another Form 4 on Monday or Tuesday with additional buys from JD. If volume continues to be strong I am targeting roughly $2.20 next week, find out soon enough. For now I am quite pleased with the current consolidation holding up well.
All the best,
Knife
Likely some more insider buying happening. Could get really interesting as price nears $2 levels...
Now that is awesome. Let the games begin. A little news would be welcome at this point to
100k shares of Ask slapping just took out CDEL blocking at $1.67, nice.
Edit, then took out another 50k from CDEL at $1.75.
All the best,
Knife
JD has stated multiple times that he would be happy to be bought out at $100+. I think a buyout of SHWZ at this juncture is pure speculation. On the contrary, I expect SHWZ to be an acquirer soon, rather than being acquired.
I have only stated it was a rumor. I have seen it mentioned on another site also, and the Stocktwits post was made after the reddit article was published. But I think we should refrain from reposted the rumor here, as we have no evidence to support it at this time.. GLTA
No idea but certainly something is going on behind the scenes. Dye did what he could to raise the pps. Who knows maybe just to get more eyes.
I still believe they are going for a larger acquisition with debt/equity. Obviously with a higher pps it would be less dilution. Of course imo
I do agree CRON would not be something Dye would pursue however with the right fit this little fish could swallow a whale. Unfortunately i do not see many opportunities with this happening and with the stringent parameters management has expressed multiple times..
Shwz was never being courted by Cronos , There was 1 post on stocktwits w 4 comments calling the guy out for posting fake news
https://stocktwits.com/Dykers/message/496579355
The reddit website said this
"There was a lot of speculation as to why this may be happening"
#3 Schwazze was being courted as a takeover prospect (e.g., Cronos)
Regardless of quality of some of these sites, more positive messaging being put out regarding SHWZ
https://www.investorsobserver.com/news/stock-update/this-cannabis-stock-is-rated-at-the-top-of-the-drug-manufacturers-specialty-generic-industry-should-you-sell-medicine-man-technologies-inc-shwz-thursday
I agree - Dye bought about 437000 shares in 3 days, but the total volume traded was about 900000, compared to a normal volume for 3 days of about 150,000 shares, so who bought the other 300,000 shares?
I also believe there is some kind of deal in the works that caused Dye and Co to want the share price to be much higher faster.
Cronos or something else? I guess we will find out, but meanwhile I'll not be trading my shares...
I basically skimmed over that and totally missed it.
I do believe there is more to this buying than the collective thought as just a passive investment based on being undervalued in lieu ofpast performance primarily q3. Nor do I believe he bought with future performance expectations.
Dye is a smart man. He could have bought before the quiet period before earnings release much cheaper. Furthermore he could have spaced these buys after q3 selectively and bought much lower than he did. Unless their is possibly merger possibilities or a larger acquisition that was mentioned in which there is cash/stock deal whereas there becomes a 10 day average etc. on such shares.
Imo,in the near future we will hear something substantial that will validate my thoughts. My belief merger news or stock/ cash deal acquisition much larger than a 1 or 2 dispensary deal.
Where are you finding these rumors? I looked on cron m.b. and unable to find any .
I also did not think the large block buys were in fact Dye, but I am very pleased with his actions. So we may see other insiders follow Justin's lead in the coming weeks. As long as JD continues to follow his play book, $5 next year is not unrealistic. Imagine what the SHWZ performance will be with another 15 or 20 dispensaries with all of them accretive deals.
Greatest thing to happen to Schwazze would be its Bioscience division inking a deal with biotech like GWP or some pharma for some molecule. Parko has all the creds. The valuation would then be completely different.
Dye has said that he plans to take this stock
To over $100 a share. I don’t think any of them
Are thinking of selling anytime soon.
If they only wanted an equity position in SHWZ then I would be OK with that, we could put the cash to good use. However, If they bought the whole thing I would be upset because CRON is quite poorly run and would ruin the hard work done by JD and the crew.
CRON has a strong balance sheet w/ roughly $900m in cash but they need it considering they only had Gross Margins on Net revenues of 5.5%, and lost $31m Operationally last quarter. In the last nine months they lost $95m Operationally, just garbage.
https://www.otcmarkets.com/filing/html?id=16208590&guid=xW_-kHwwSFTsB3h
I would bank mad cash if they were bought out at a good price so no worries there, but I would hate to see all that has been built in the last few years be diminished by a poor operator.
All the best,
Knife
Well, Dye might want the price up higher, to get a higher bid... ya just never know...
Well CRON has a warchest of BILLIONS of DOLLARS cash, and if they took an equity position in $SHWZ, the huge loans could be paid off and the company become much more profitable, at the expense of more dilution.
I don't know much about CRON, but I never dismiss a rumor like this, especially one that I now have seen multiple times...
Only if they sell for $20 a share to an outfit like CRON would I be okay with it...
Doubt Dye would be buying all those shares if they were in buyout negotiations…..unless it was a hostile takeover of course.
I would be upset if SHWZ sold themselves to a crappy operation like CRON, lol.
Knife
$CRON buyout of $SHWZ rumors persist on reddit.
The infamous Benzinga has this out:
https://www.benzinga.com/news/22/11/29768444/672k-reasons-to-be-bullish-on-medicine-man-technologies-stock
Some decent size Bids showing up again, strong consolidation day so far.
All the best,
Knife
Reading the tea leaves...about the clearest signal (hint, hint, hint) he is allowed to make, perhaps? I believe I recall an earlier time...hmmm, wasn't that simply an insignificant shift from consulting to retail?
Imagine the move when safe+ is passed in a few weeks…..just shows how little shares it takes to run this up…..too bad there are way too many retail traders in this one.
Dye now has your shares tucked away with hopes of a much higher pps.
I didn't consider the recent move to be from insider purchases either considering how many shares JD controls already, surprising.
https://www.otcmarkets.com/filing/html?id=16208590&guid=8C_-k6k12W-ndth
He knows how undervalued they are and is taking advantage of it as well.
Good times,
Knife
I sold 25% of my position yesterday, I’m hoping for a 15% pullback, if it happens it’ll be great, it it doesn’t it’ll be great to. Let’s see.
lol - re"Conclusion" - SHWZ is successfully driving down expenses and costs even as it invests in growth in the Colorado and New Mexico markets. It has made a big run since its earnings report, where investors liked what they heard.
For that reason, it would probably be best to wait for a pullback in its share price before taking a position.
Ok, so $1.88 down to $1.61 is not enough pullback. What if Dye is still buying? What if other insiders also join in and buy shares on the open market?
There are already a lot of "waiters and flippers" that now are praying for this pullback, as this rally totally caught them by surprise, and they flipped and watched in horror as the price continued to rise.
This is exactly what I have been calling for here, for insiders to show some confidence in the company and buy some common shares to show investors they believe in the company and the common shares.
So keep waiting for that pullback... and good luck!
Schwazze Executing Well In Difficult Economic Conditions
Nov. 17, 2022 5:48 AM ETMedicine Man Technologies, Inc. (SHWZ)
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Gary Bourgeault
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Summary
Schwazze continues to perform well under difficult conditions.
The company continues to work on running lean while investing in growth.
SHWZ is positioned well to launch more growth initiatives heading into 2023.
Why the second half of 2023 could be a big one for the company.
Senior and Junior Botanists Examining Cannabis Plant in Vegetable Garden
CasarsaGuru/E+ via Getty Images
Schwazze (OTCQX:SHWZ), formerly Medicine Man Technologies, Inc., has been performing well in 2022 under difficult economic conditions that have hit the cannabis sector hard.
While its share price has dropped from approximately $3.25 in January 2021 to a 52-week low of $0.8665 on July 13, 2022, in response to its last couple of earnings reports, it has jumped to higher lows and higher highs, as the company continues to cut costs, increase sales, and rapidly increase its footprint in New Mexico.
For the quarter, the company also generated $4 million in positive cash and expects to generate positive cash flow for the year before acquisitions, one of the few companies in the cannabis sector to accomplish that.
In this article we'll look at the latest earnings report of the company, its performance prospects going forward, and what the growth drivers will be going forward.
Latest earnings
Revenue in the third quarter was $43.2 million, up 36 percent from the $31.8 million in revenue generated in the third quarter of 2021. Revenue for the first nine months of 2022 was $119.2 million, an increase from the $81.9 million in revenue from 2021 in the same quarter.
Most of the increase in revenue came as a result of acquisitions SHWZ made.
Net income in the reporting period came in at $1.8 million, up from $1.0 million year-over-year.
Adjusted EBITDA was $15.9 million, accounting for 36.7 percent of revenue, compared to $8.8 million in adjusted EBITDA last year in the third quarter.
Gross profit margin jumped from 47.3 percent in Q3 2021 to 60.1 percent in Q3 2022, which was primarily attributed to an increase in the percentage of retail sales and vertical product sales in New Mexico.
Operating expenses in the third quarter were $14.8 million, up $3.6 million from the $11.2 million in operating expenses from the third quarter of 2021. The increase in expenses was from acquisitions and the accompanying operational costs associated with the businesses.
Other expenses were $3.7 million, an increase of $2.2 million, or 139 percent over the $1.6 million in Other expenses year-over-year. That came from paying higher interest payments because of increasing its debt load.
SHWZ guided full-year 2022 revenue to be in a range of $155 million to 165 million, and adjusted EBITDA from $51 million to $56 million.
The revised revenue outlook came from wholesale sales coming in below expectations and delays in new store openings in New Mexico related to construction issues.
Colorado and New Mexico
SHWZ has operations in the states of Colorado and New Mexico. In this section of the article, we'll look at each of them and what the prospects are going forward.
Colorado
In 2022 the company has 5 more cannabis dispensaries and one more cultivation facility.
On September 14 also announced it had signed definite documents to acquire some of the assets of Lightshade dispensaries for $2.75 million in cash. That will add a couple more dispensaries in Colorado, bringing the total to 25 at this time. Expectations are the deal will close some time in Q1 2023.SHWZ also entered into "a licensing agreement with Lowell Farms to manufacture and distribute Lowell Farms Smokes, a premier line of pre-rolled joints to dispensaries statewide." Sales are expected to start in the fourth quarter of 2022.
After delays related to approval from the city, construction on its Colorado internal distribution center is nearing completion and should be operational in Q4. Management stated that the center will remove a lot of waste out of its supply chain.
Same-store sales were down 10.6 percent year-over-year, coinciding with the drop in the total customer visits to 452,220, down 10.7 percent from the third quarter of 2021. Even with the slowdown, the company outperformed the Colorado market by 12 percent in the reporting period.
Last, wholesale revenues continue to slide in the state because of oversupply in the market, resulting in downward pressure on prices.
New Mexico
So far, in 2022, Schwazze has increased the number of its dispensaries in New Mexico by 10 and added another four cultivation facilities in the state. It also added one more manufacturing facility in the market. New Mexico is also part of the licensing agreement the company made with Lowell Farms to sell its pre-rolled joints. A date wasn't given as to when sales will start.
In April 2022 SHWZ started to sell both recreational and medical cannabis in New Mexico, with same-store sales climbing 48.4 percent in comparison to last year in Q3. Sales have been growing on a month-to-month basis since then.
Going forward, New Mexico will also continue to grow at it adds dispensaries to new, local markets across the state, focusing primarily on its southern and eastern borders. Recreational sales are also expected to continue to grow in the quarters ahead.
Revenue in New Mexico was $43.2 million in the third quarter, up 36 percent from $31.8 million year-over-year.
Conclusion
SHWZ is successfully driving down expenses and costs even as it invests in growth in the Colorado and New Mexico markets. It has made a big run since its earnings report, where investors liked what they heard.
For that reason, it would probably be best to wait for a pullback in its share price before taking a position.
I think the company is well-positioned to continue to grow revenue in 2023 and could outperform as it closes in on generating free cash flow before acquisitions, possibly on a consistent basis. It is driving down its internal costs, and benefits of wider margin are expected to "be fully realized in 2023."
If that's how it plays out, earnings and free cash flow will improve as the company grows its revenue from the moves it's making in Colorado, and especially New Mexico, which has a lot of momentum heading into 2023.
What's impressive to me is SHWZ doing this in very tough economic conditions and doing much of it with retail customers. Being able to maintain growth among retail customers is a competitive advantage because of higher pricing power and wider margin.
Assuming it can continue executing like that in 2023, it's going to surprise a lot of people to the upside, especially if inflation drops significantly, the Federal Reserve stops or significantly reduces its interest rate policy, and consumer sentiment starts to improve. If so, the second half of 2023 could be a big one for the company
If anyone can copy and paste seeking alpha article , ive hit my limit and hit the paywall
$SHWZ @Schwazze_2021@Schwazze #MSOGang#CannabisCommunity #LFG pic.twitter.com/j6y5SU8mGv
— Mia Madison🦋 (@miamadisondd) November 16, 2022
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Meet the "Steve Jobs of Cannabis" and Schwazze's Chief Cultivation Officer, Josh Haupt:
https://www.youtube.com/watch?v=s36OIBT4XiQ&t=1s
Star Buds is one of the Most Recognized and Successful Retail Cannabis Operators in North America
Company Projects Pro Forma Revenue for Schwazze and its Two Acquisitions (Mesa Organics and Star Buds) of $95 Million in 2020
Company Expects to Be Cash Flow Positive Beginning in January 2021
Company Anticipates Acquiring Remaining Seven Star Buds Retail Dispensaries in Colorado during the First Quarter 2021
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