Making Marijuana Millionaires
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Virdian Capitol interviewed JD today not sure where to find that link , mostly stuff we heard but here is there ANal List report
https://assets.website-files.com/5da7e7a83e54881821d857c6/6283d0acdd48a11583287c49_Schwazze%20(5.16.2022).pdf
I wanted to comment on what I picked up when I was watching a couple of the videos that people posted over the weekend here on the forum.
JD talked about organic growth in New Mexico my guess is because it's just not a lot of other businesses to buy.
He talked about acquisition of exsisting Dispensaries in Colorado.
The main thing he talked about was he felt that safe banking would reset the multiples on which cannabis stocks traded at, to a significantly higher level.
And that safe banking would also bring in more institutional money.
Of course none of this is anything new it just feels good seeing our CEO talk positively and confidently about up and coming catalysts. I would probably be buying more if I didn't own so much of it already.
Thanks for your insight , id like to add a really good indicator of business acumen that with no doubt JD acquired and honed at Albertsons ,,,Rev per employee
Rev./Employee (TTM)
Shwz Avg: 310.69
Industry Avg: 171.3K
At 1st glance this may not seem like a big deal but Alot of Ceo's in this space dont have experience in a slim margin arena and we do its simple math , Dispensaries # 1 and #2 cost are Employees and Product If you can deliver these at under 50% gross profit the you have won the game before it even started
I see other MSO's operating with this margin but these are new or medical only markets .
Its just a matter of time to absorb buildout and /or aquisition costs to get better then normalized Net profit margins.
Bottom Line Growth costs and we grew alot recently !!!
If you only focus on operating cash flows vs growth related investment type expenses, what SHWZ has done is totally acceptable. The last quarter used is a typical seasonal low quarter, has some macro-economic uniqueness from the covid BS effects on spending mucho time at home type of habits. April and May sales should be way better well based upon NM up and running and second half of the year will see some serious growth. Each cannabis company is in similar situations but margins are state by state unique. And many of the other MSO are implementing major cost reductions and efficiency measures .
We have experience at price compression for some time It is easy to see which MSOs will have cash flows in excess of growth needs. The new guys to SHWZ boards are clearly paid shills , please stop the spam generalizations. Would you rather they play it safe and not expand and just Stay just in Colorado ? No of course not so we bought New Mexico and took on Debt .
The main point is this as a process over time and focusing on current debt and on one quarter is Myopic . As far as debt rates go , Curaleaf borrowed at 8% last November with no banking regulation changes, I would imagine that one of the tools JD can easily implement ( interest rate reduction)when the timing is right .
There are lots of Superficial hit piece/ comments being thrown out now. In reality, if cash become a problem shwz can reduce their growth dramatically and CAPEX would shrink to next to nothing.
However, similar to other MSOs that are investing large sums and as states are legalizing recreational and SAFE banking act is really just a matter of time. i agree that undercapitalized companies will be swallowed up as the industry consolidates.
Great time to be accumulating shares if you are an real investor and not a paid pump and dump joker
Like
Derivative liabilities are initially measured at fair value and subsequently stated at fair value, with any resultant gains or losses recognized in profit or loss. The company has loans that are convertible stock. PPS goes up, liabilty goes up (on paper). Opposite is also true.
$LOWLF stated clearly on last weeks' EC "our liquidity leaves very little room for error". My full call quotes attached which offer lots of insights into the CA operating environment pic.twitter.com/B1upchpvbr
— LogicPrevails (@LogicPrevails_) May 17, 2022
I Agree with this may 11th statement from twitter , Do you agree or not Drugdoctor1
$SHWZ $1.65 - was up over 7% yesterday, the BEST USA marijuana company.$PLAY $NKLA $INO $DKNG $PTON $WKHS $SPAQ $JCPNQ $BA $BBIG$AMZN $TSLA $WMT $TGT $NVDA $SPY $GLD $EBAY $AAPL $FB $TWTR $GS $S $GOOG $DIS $IBM $MSFT $GOOGL $BIDU
— Drugdoctor1 (@Drugdoctor2014) May 11, 2022
https://t.co/VPIUocRD4i
This bodes well for Cannabis investors Booze going up Cannabis at the most affordable price points ever,,,AND it a Big Pharma killer....https://www.stltoday.com/business/local/anheuser-busch-hikes-beer-prices-again-to-deal-with-inflation/article_c8368777-2cf1-59b8-ad19-e612ba4fc87e.html
A review concluded that "people use medical cannabis as a substitute for prescription drugs"
https://www.tandfonline.com/doi/abs/10.1080/14659891.2022.2070870
Unlike some of the current dumpers AKA previous pumpers , I still think Justin dye and his team are setting us up for some serious wealth
https://twitter.com/Marc_Eli_/status/1527283891702226945/photo/1
Lots of possibilities with safe banking coming up,,,
.@JakeSherman on the timeline for COMPETES; goal is to have all legislative items “closed out” by 5/25 (next week) / finished by 6/21.
— Todd Harrison (@todd_harrison) May 19, 2022
^ one of several shots on goal for #SAFEBanking this yr
^ 6/23 is my 🎂 @SenSchumer
🇺🇸 #cannabis 🌿https://t.co/ThgDOtbUwS pic.twitter.com/oRdpRYsDpQ
"The emergence of legal cannabis is one of the biggest – if not the biggest – new markets of our generation. And right now, cannabis stocks are the cheapest they've ever been." -@WhitneyTilson https://t.co/hxAyWiEpp8 pic.twitter.com/ySkpy6t4et
— Jesse Felder (@jessefelder) May 19, 2022
The Best USA cannabis company
$SHWZ $1.65 - was up over 7% yesterday, the BEST USA marijuana company.$PLAY $NKLA $INO $DKNG $PTON $WKHS $SPAQ $JCPNQ $BA $BBIG$AMZN $TSLA $WMT $TGT $NVDA $SPY $GLD $EBAY $AAPL $FB $TWTR $GS $S $GOOG $DIS $IBM $MSFT $GOOGL $BIDU
— Drugdoctor1 (@Drugdoctor2014) May 11, 2022
https://t.co/VPIUocRD4i
Wow you are relentless ,but never the less consistent swinging from one end of the pendulum to the other... Shwz is the same Co today as a week ago. Almost every Mso had a similar quarter, Love picking up those $1.45 , Gotta shine this Turd up !!!!!
Nothing new here just a few highlights from the call ;
....Being vertically integrated improves there margins significantly. In Colorado, they just acquired 2 growers in the last 6 months.
....Introduce product from there into our stores going forward , which will increase the bottom line
....Now what it allows us to do here also is to create our own branded flower, and pre rolls from ( LOWLF ) offering customers products that they want with highest quality.
.....From JD,,
"launching new products and brands and
having success with the Purplebee's vape cartridge line that we've launched that has done very well,
launching Lowell Farms, which is a great brand, #1 brand in California. They chose us and we chose them to
partner in our market."
There is some interesting perspective about basket size in these 2 articles
https://cannabis.net/blog/opinion/is-the-us-cannabis-industry-just-a-house-of-cards-look-north-to-see-the-future-of-the-us-weed-i
https://highway33.com/2022-infographic-more-dispensaries-high-sales-our-best-look-yet-at-420-data/
t can’t go much lower, but it still may.
Q1 a bit disappointing, but not dissimilar to all others the outlook is still positive with the short term debt resolved
2022 guidance same as prior predictions, Gary has shown to be a good leader & CEO
I’m still bullish
Check again , its up 4.5%,,,,LOOKING FORWARD TO TONITE
Big news For Cali They proposed to drop the Cannabis tax to ZERO July 1 2022
‘We pay taxes as if we’re dealing cocaine,’ Trulieve CEO says
‘We pay taxes as if we’re dealing cocaine,’ Trulieve CEO says
This is great news , id really like to have some lowell smokes on my table at home , whish they would both come to Florida, back a few years ago Brett Roper said they had an interest in florida ? probably divested long time ago
https://toddharrison.substack.com/p/rise-of-the-machines?s=r&utm_campaign=post&utm_medium=email
“Everyone has the narrative completely wrong: now is not the time to worry about slowing sales or margin pressure. MSOs are particularly attractive bc any slowdown is due to the illicit market being oversupplied / underenforced and it does not change the fact that a handful of companies get to participate in a landgrab that is off limits to small / big competition alike. Current margins aren't relevant bc enforcement will increase over time and the illicit market will eventually fade given safety concerns and w the adoption of additional form factors.
What’s relevant? Gaining share and building brands. The illicit market helps prevent any real competition from smaller players, as does 280E (?this is a feature not a bug); big box CPG can't compete bc federally illegal so status quo best case for MSOs. This will seem super obvious in a few months but in the fog of war, people only want a sensible explanation for why things are so bad so these excuses for weakness are reverse engineered.
All that matters right now is that quants are shorting everything and they will continue to do so until correlations start breaking. I wouldn’t be surprised if quant funds / their commission dollars encouraged custodians to pull back from US cannabis… and IDK if it’s Citadel that has this trade on in massive size but whoever it is, it sure looks and feels like a Citadel-type fund.”
I own alot of Lowlf as well as Tlltf and Schwazze, The market cap of these three is insanely low and they all own some very good brands , I think Lowell Pre-rolls will be a hit, they are # 3 in Cali
They have less revenue then last year ,,, Sucks if you ask me
JD is a BadAss ...... He is a total winner !!! What other Boss of a Company this size is there at Midnight to greet people ?
Columbia Care: Major Catalysts
Stone Fox Capital
Summary
Columbia Care is a prime takeover target on the federal approval of cannabis likely to get more focus from Senate Majority leader Schumer.
The MSO has a major catalyst from recreational sales launching in New York, New Jersey and Virginia.
The stock is insanely cheap at 6x '22 EBITDA targets.
The new board member used to give M&A advice t clients when he worked for Goldman Sachs.
For perspective , SHWZ has alot of growth potential as well as the whole industry
There are 44,307 Beer, Wine & Liquor Stores businesses in the US as of 2022,
There are 9,512 Cannabis lic issued in the US as of 2022,However many of these are still just paper lic , with stores still to be leased or built.
Dispensaries and retailers had 1,846 licenses were issued through August 2021, and the year ended with 2,602 licenses. Seven states issued a hundred or more licenses with Oklahoma keeping the crown for issuing the most dispensary licenses. Oklahoma is recreational and has the most dispensaries in the country
The most logical next state to me is Oklahoma ( Please come true }, they already have 8 Starbuds and they are recreational.
Thats interesting , a potential Nasdaq uplisting? We do operate in 2 recreational legal states , its seems that most other mso's operate in medical only states as well? Not sure if thats relevant ? Just a thought that im putting out to the universe