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The drop following the gap up is a good sign. Normally, we saw a spike up followed by the sell-off to prices below the precious days' closing, followed by a consolidation at support levels.
Today's stability following the spike is a great sign that low .11s have tons of support and that we'll be here for awhile.
Monday may prove interesting with Obama's statement not getting mass-public airtime until tonight.
It is my hope it encourages more appetite for the risk MJNA represents. (Don't jump on me: every stock purchase represents risk).
I still think the risk is out there, but its much less likely and I am readjusting my expectations upwards.
I've been saying upper 9s and low 11s. Now with the reduction in risk, I think 10s to upper 12s is realistic, and enthusiasm with increased appetite for risk can drive the P/E higher outside of stable (P/E of 12-16 range) and into "enthusiastic and beyond"
We could see a P/E of 20 on this news.
Using 600M shares outstanding (as per Google finance and rounded up very slightly) and Q3 Earnings * 4 for annualization:
P/E PPS
12 .0952
13 .1031
14 .1111
15 .1190
16 .1269
17 .1348
18 .1428
19 .1507
20 .1587
21 .1666
22 .1745
23 .1824
24 .1904
25 .1983
We're currently at a P/E of 14-15, and could see stable support upwards of 20 (.16 pps) with this news.
You hear me, but I'm getting pounded by different people who are not hearing me and jumping to conclusions regarding my simple statement. So I reply in kind and it just seems like I'm pounding on it over and over, I'm just replying.
Damnit people: its still a risk. I've always been pragmatic and I'm never prone to over exaggeration! I'm not saying it will happen, but the risk is there, however small now.
This statement is very helpful and will encourage investors to accept more risk and invest in MJ markets... Which is good, but it could be better!
AGREED!!!!!
Even right handed batters occasionally hit into left field :).
Again people are misreading everything I'm saying: WE NEED THE FEDERAL LAW TO CHANGE.
Fact. Everything is speculation, but still a possibility, even if remote.
I don't disagree: but tell me, do officers ever go against their superiors wishes? In the history of law enforcement, has that never happened?
Sure a s*** storm will follow, but that's not to say somebody with their own moral authority won't still go against the grain.
Let me reiterate: I'm not saying this will happen. Just that this doesn't change the law, it only reduces the risk, significantly, but not 100%.
Gmatt600:
I was not belittling you... You have to admit many people on here speak above their level of knowledge and its never safe to assume they have all the info.
Back to your comment:
That's saying congress/senate pass the laws first. The president does not have the authority to make it happen as he sees fit, he can only veto/ disagree with what congress/senate places on his desk.
As well, the President has no say over the Supreme Court. Congress may fail to pass a law and SCOTUS may choose not to hear any cases brought in front of them. In both cases, the President no power to do anything about it. He can influence SCOTUS via appointees if a member were to retire, but that's it.
You obviously don't know anybody in law enforcement: sure, its potentially career suicide to go against superiors directives, but legally they can uphold the federal law!!!!
It will only take a republican to be voted in next for those agents who were shamed to get their power back. They cannot legally be fired, but promotions could be withheld. If the federal law does not change I. 4 years, and a moral authority type of conservative is elected, the risk goes through the roof!!!
I never said it would happen. That's like predicting a hurricane will hit the US next year at a very specific city. The probability of a hurricane is there (the federal law as written), but the probability of a specific city getting hit is much much much less but still not zero.
How could I possibly be wrong as to mention a risk, even going so far as to diminish the risk from yesterday to today, but to remind everybody this is not the removal of said risk. We need the federal law to change: a new congressional law or a SCOTUS decision. Without either of those two, the risk exists.
If the law doesn't change, and a conservative is voted into office in 4 years, expect PPS of all publicly traded firms in this market to take a hit on Nov 7th, 2016.
We need a new law.
WhirledBeet
You are trying to inflame an honest concern.
No, that is nothing close to what I said.
I'm not saying anything will happen, just that if a senior agent wants to bust down the doors of a store legally selling products with THC, shut them down and arrest everybody working there: they can without fear of reprisal because the law is on their side.
Will politics influence? Yes. Will politics influence everybody? No... All you need is one conservative/moral values agent who doesn't feel obligated to a president he didn't vote for.
I'm saying risk still exists... Albeit political influence will diminish that risk.
The second tier is the federal prosecutors: even with a 'rogue' agent, federal prosecutors will have to choose to prosecute. The same risks are there of a conservative following the law as written. However statistically that reduces the risk even more.
Example: assume the potential of an agent to bust is 50/50 (like a coin flip), that is a 50% risk. Now assume the potential of a prosecutor is willing to file charges is 50/50, the end risk becomes 50% of 50% = 25%. The reality is politics will have an influence, ESPECIALLY at the federal prosecutor level, further reducing that risk.
I honestly hope our stable P/E will rise on this news... But I'm pragmatic and until the law is changed, I treat this risk as very real and potentially damaging to the industry as a whole.
The probability of it happening has reduced significantly, but its still about the federal law as currently written.
I never said anything about busting users: that has always been a local police jurisdictional concern and the city/county/state law enforcement divisions are only upholding state laws.
It's not in the US President's authority to legalize it. It requires a SCOTUS decision or a law passed by congress.
Again, while this is positive, DEA agents are lifelong careerists, not political appointees and they really don't answer to the President.
He can get them fired, but the lawsuits would be a pain: if they choose to uphold federal law, they cannot be legally fired for doing their jobs.
This will come down to federal agents trying to make a name for themselves or not. It's not about resources or political views, its about the law and whether or not individuals who have the power will choose to uphold or ignore.
It will be a region by region issue as different federal agents have say over what happens in their areas.
As well, federal prosecutors may choose to prosecute or not.
It's very positive, but still unsubstantial.
$10 and $20 are not doable. Too many shares outstanding, demand would be met by savvy shareholders who know the prices are unsustainable and will dump shares to pull profits on the way up, effectively releasing any upward pressure.
I know what my sell point is for Q3 report, and will reevaluate my sell point for Q4. Bases on the question: what is sustainable. There will be ups and there will be downs where I can reload if prices are sustainable again. (Recent proof: .118 unsustainable, .106 great buy back opportunity, I missed my shot to flip but I'm not worried, I'm long for several months).
This stock should only be treated as a stinky pinky for reasons of the low PPS and limited information. However, it performs like a large firm and Finance Fundamentals hold true.
We won't see .16 unless MM's or newsletter groups decide to pump it up, but there are too many profit takers for that to really happen. Fundamentals say .11 is a good price, .12 is amazing and .16 unsustainable.
Q4/Annual and Audit/Uplist will reset the expected base support levels according to fundamental finance.
Uplist will attract more buyers and that will drive prices up, but don't expect $1 let alone $10 due to a random skyrocket.
When we get to $1 it will be because of enthusiasm driving the P/E higher and annual revenues near $60-75M (quarterly between 15-20, which is a 10x revenue multiple supported by enthusiasm).
This is subject to fluctuation based on demand and confidence that determines the P/E.
example: Confidence dropped recently when MJNA executives failed to file Q3 on time and the PPS dropped until they submitted and it quickly returned to where it left off.
When discussing Medbox like performance, there are several factors that can be looked at, and when analyzed it becomes painfully aware of how it happened and why MJNA would not jump anywhere near that.
MJNA's growth will be reasonable with exception to potentially higher P/E ratios, but nothing like Medbox will happen.
A) Too many shares outstanding
B) Float is significantly larger
C) too many profit takers
Medbox has too few s/o and most are held by insiders which means any demand for the stock won't be easily met by available sellers. As demand grows with few sellers, the price jumps.
Demand for MJNA will always be met. We may see a few pennies growth during some random jump but we won't see one day skyrockets.
Define soon: it's a subjective term.
Medbox has a different stock structure that allows for that type of boom.
MJNA does not. Boom for MJNA would be .11 to .20 without any significant news.
I have posted the breakdown a few times if you wish to learn about the difference, just look up my posting history.
The announced Q3 on 15 Nov... They did not formally deliver their report. Look at the prices from 16 Nov until Tier upgrade last week: down down down. Then the tier was upgraded back to "reporting" and the price bounced.
Stop looking at the technicals at look at actual/factual historic prices. We were at .12 when we collapsed just after Q3.
Leadership failed to submit the report on time and the stockholders were penalized!
I am! I've said it over and over: we never should have dipped into the .08s!!
MJNA executive leadership failed to report Q3 on time. The stock dropped until they reported and then it jumped right back to where it was!
True!
1.19M earning to 2.4M with all the publicity and brand awareness is not unrealistic.
But I honestly think we could see triple: the uplist to a bulletin board with the audit will attract more investors: more demand/volume : more attention.
If we double the revenue and assume same margins and double the earnings, with a stable P/E of 12-16 we're looking at .18 to .24 and the BB upgrade will open the door to higher P/E ratios. When that happens, the P/E could really jump and we could see 4 or 5 times.
Weather it's sustainable I cannot say, but enthusiasm will drive us up. The question will be the shorts and profit takers: will they hold or will they sell off and dampen that enthusiasm?
This is a stair step stock. We should have been around .11 since Q3, but MJNA failed to report to OTCMarkets on time and we were penalized by the shareholders by all the selling the drive the price into the .08s until they reported and the yield was removed.
Had that not happened we would have been mostly sideways and very boring.
Only bad news hurts us: the yield sign was bad. With real news (like Qs and audit/uplist) we will adjust upwards each time and fundamentals will keep us stable.
Watch out for the higher P/E after audit/uplist, a lack of news will cause wider swings than just +/- .01.
CBD is Cannabanoidial
It's a compound of Hemp not MJ.
CBDs are not sched 1, only the THC infused products are.
Lol! When does 2,000 X 500 = 1,000,000,000?
2,000 x 500 = 1,000,000
You would need 38.5k revenue per store per week for 52 weeks to = 1B.
Now I know what many of our board members are delusional, they can't do math.
Not only that, but MJNA only owns 60% of Dixie, so MJNA will not get the full 1B revenue for their financial statements.
We'll see if the oil business takes off or not.
Long and Strong: anything over .113 seems to be unsupported at this time. We need real news detailing contracts and values or increased distribution to other states outside of Colorado. Talk is cheap, show me the numbers/facts!
Folks, please remember: we're subject to market forces not executive wishes.
Q4/Annual is our next objective, going to have to wait it out and not let the daily swings get your panties in a bunch.
If you do let the small details get to you, you're probably a flipper and profit taker and are partially to blame for some of the drops we're seeing.
We won't see higher PPS until Q4/Annual, unless its just a temporary swing that's unsustainable until new financial data is released (like sales/distribution contracts).
There is also the pink/audit of the PPS, that's the gatekeeper to higher P/E ratios... We could see a 30 PPE after audit, add in an expected higher profits/earnings and we're going places!
Wow... The delusional posts from 2-3 hours ago are fun to read.
I say we're still in the range of upper 9s and low 11s. These #s are supported by sound financial fundamentals.. 12-16 P/E.
We need real news!!!
Not this BS Soft fluffy PR from yesterday and not speculation from Tripp during an interview.
Get Tripp to say 1B in 14 months or he steps down: that would instill confidence.
But he's not saying that, MJNA or its subsidiaries are not saying ANYTHING of worth... It's all just optimistic wishful thinking with at side of probability without the actual % of probability mentioned.
I was driving into work and preoccupied in meetings when it peaked, but I was holding my finger over the sell button until I got entirely distracted with real money (my real paycheck) that I missed the drop.
Not a big deal, I'm long.
DHX is not Red Dice Holdings... That must be a typo. Dice Holdings owns a bunch of career/job websites.
Here I come with the Debbie-Downer, the pragmatic response.
If every prediction of every business executive came true, no businesses would ever go out of business.
He's not accountable for speculation made during an interview, only what's stated in formally reported financial statements.
1B would be awesome, but don't expect it...
You might want to say "yeah, but who would know better?", not him. He's just trying to raise awareness: an attempt at a self fulfilling prophecy. The more he says things like this, the more attention he gets, the more brand awareness he wins, the more sales... It's a rather smart ploy.
Be happy if it happens, but do not bet the farm on it.
No PR is ever bad news.
A few weeks back I noticed the Yield sign on OTCMarkets.com and asked about it: none of us really knew it was because the company failed to actually submit Q3 on time. Look at the price on Nove 15th... Up!.. Then on the 16th it started to fall all the way until the tier upgrade and removal of the yield sign.
That would have been bad news... But nobody caught it... Until I realized what happened and posted about the removal of the yield and called a mid .09 to mid .11 support with finance fundamentals.
I don't think I need to say how much I feel ya.
Cheers. I don't bring a negative consideration as a 'slam' to the company, its just 'what if' discussions that are very applicable and not just some abstract theoretical dilemma.
Wow: this is a well informed response. Thank you.
You're absolutely right.
If you take into account short term PPS expectations due to finance fundamentals, over production is bad : microeconomics.
I would say that your position takes macro-economics into account (competition).
Wow. Trust them? If all companies perfectly met 100% of demand there would never be competition and no companies would ever go out of business.
There were previous PRs that stated their annual expected capacity, and. 7.5M order wouldn't even dent it if assuming production margin was as low as 10% of retail price of dew drops.
I said the PR was optimistic fluff. I was challenged and supported my arguments.
Yes, textbook economics. Can be read anywhere. But I also read between the lines: there was zero confirmation that Phytosphere actually made sales to other industries. They obviously want to, an the PR promoted all the values, but didn't actually state they have sales agreements or contracts.
You have to be pragmatic when analyzing PRs. There is much to be learned by understanding what was not said as much as what was.
Agreed: helpful to evaluate overproduction risks.
Wow... Really reaching deep.
What about when they overproduced Ford trucks in the mid 2000s and had to drastically cut their prices below cost just to move them and reduce their inventory? Wow, what about that overproduction and failure to evaluate demand?
Ford sells retail/consumer products and it often results in end of model year sales to dump what they couldn't otherwise sell (often at a small loss). Phytosphere sells a resource to manufacturers. If they can't sell all their inventory, they can't just make a few changes and start selling the 2014 model year and take a loss by selling the 2013 for cheaper.
Does CBD oil have a shelf-life? That would make over production even worse.
Stop trying to argue business economics with me, you are losing.
I never said they won't sell out, I just read the PR and saw that it said they have increased production but did not say how much they already have contracted to sell. They said nothing of agreed sales to other industries, they only promoted the value to other industries: promotions do not result in sales, or no retail store would ever go out of business.
100% sales of all inventory at the same price means they are operating at demand or below, which is good for profit margins.
I never said they had too much, but the company did admit to having increased production but not actual contracts for sales.
I'm still saying it was an optimistic PR, but not substantial.
However, a sharp mind reads between the lines and evaluates what was not said. If everything was taken at face value, no company would ever fail to meet projections/expectations.
While we all agree CBD oils are great and have potential in many different products, that does not mean MJNA will sell out. It does not mean MJNA will operate at max efficiency - over production can quickly cause excess inventory which causes accounting issues that result in lost margins (relative to selling 100%), or it results in price drops that reduce revenues.
In both cases excess inventory means a reduction in earnings - they are paying to produce that excess inventory and if they don't sell it, their their costs rise in relation to the revenues and their operating margins decrease.
I'm talking about margins: which means profits, which is just as important (or more) than revenues: you can increase revenues, but if your margins shrink your value takes a hit.
Your value can be sustained if those costs that reduce earnings are a direct result of investment in future earnings (profits, not revenues), but if those investments don't pan out and you can't move the increased inventory, you are not operating at maximum efficiency and you are throwing away profits.
All I'm saying is too much inventory is worse than not enough: growing faster than your market demand = dangerous grounds.
Not growing fast enough to meet demand has never hurt a company... Success favors the cautious.
Try and argue with fundamental micro-economics all you want, but you'd be wrong.
What makes you believe they have contracts to sell every drop?
Agreed: there's often an AM drop and slow rise, but occasionally there's no drop, with a rise and then test of the ceiling: I think we can fairly say .11 has been our ceiling as of late.
I've been saying since the Yield was removed (tier change) that we can expect fluctuation between upper .09s and low .11s because the fundamentals support that price range. Technicals might be manipulated by MMs to move above or below, but not for a sustained period.
IMO we won't see it grow beyond low .11s without a significant reason for increased hype/speculation/enthusiasm.
Intra-day movement might exceed low .11s but I'm not expecting any sustained growth in PPS just yet.
Today's PR isn't a growth type of PR, just positive reinforcement of support.
If it breaks/closes .113 ill happily admit I'm wrong and promise to buy you a beer if you're ever in Houston, Tx.
If it doesn't, it only means we're back to where we were a few days ago, bumping our head on the .11 ceiling.
The PR was just an optimistic pay on the back, nothing more. That's all I'm saying: supportive but not pushing us anywhere.
I'm not missing quantity, but if they do not sell out, product sits on the shelves and the cost effectiveness of the operation decreases. Too much inventory is worse than not enough.
Position does not mean $ directly. It's a teaser, fluff for people who don't read between the lines.
This PR said the following.
We have increased our yield which means we have more to sell and we're trying to work with potential customers on how they could use our product.
All it confirms is that we have more product to sell and our sales team is working hard: it does not confirm new revenue.
Bah humbug? Perhaps, I'm just being practical... This PR will support the PPS and that's it.
This PR is optimistic, but optimism doesn't put food on the table.