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07/14/06
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Founded in Oregon in 2016, Halo is a cannabis extraction company that develops and manufactures quality cannabis oils and concentrates, which are the fastest growing segments in the cannabis industry. Halo is a global leader in cannabis oil and concentrates, having produced over 4.5 million grams of oils and concentrates since inception. The Company has expertise across all major cannabis manufacturing processes, leveraging a variety of proprietary processes and products. The forward-thinking company is led by a strong management team with deep industry knowledge and blue-chip experience. The Company is currently operating in California and Oregon, as well as in Nevada with our partner Just Quality, LLC, and in Lesotho with the Bophelo strategic partnership. With a consumer-centric focus, Halo will continue to market innovative, branded, and private label products across multiple product categories. Halo recently acquired Dispensary Track platform which will alleviate customer flow constraints experienced by dispensaries and enable direct consumer interaction.
Summary: ? Halo grew revenues beyond our expectations o As we had expected, ramping California sales drove substantially higher revenues o Opportunity in Nevada, and pricing stabilizing n Oregon ? We raise our estimates o SepQ19 revenues raised from $8.8m to $11.0m o DecQ19 revenues raised from $9.1m to $14.0m o CY19 revenues raised from $38m to $43m ? Halo is trading at a ridiculously cheap valuation versus its direct comparables: o Trading at 1.2x CY19E revenues o Average comparable trades at 11.8x CY19E revenues o The nearest valued company is CV Sciences at 4.7x CY19E revenues o Our $100 price target is only 2.5x CY19E revenues ? California is the outstanding growth driver o This is the key focus for the company o California harvest is in late Q4 o Biomass purchases from the Emerald Triangle – strong relationships with 2-3 farms
