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Let’s see if this falling wedge finally breaks to the upside. MSOS has come off the bid the last few days. Hopefully they are not done adding. Still holding traders, added a few more.
Such weakness with msos 1M share buying backstop recently is not a good sign and threatens all recent support imo. Msos came back in on buy side right around 30 days post despac so my guess is this selling pressure is based on some investor share lockup expiry, possibly the pipe. I listened to Steve on benzinga and he really offers some interesting insights on how they’re able to strategically tweak on the fly in ways only full control of the chain can allow. But they only control upstream supply for 14 more months so that appears the first order of business. They need complete access or ownership of probably 1M sf of very low cost grow so either an organic or inorganic announcement should be expected soon.
Yes good point. This is not supposed to be a very long trade so I’m not giving it much more leeway. Msos continued to add into the end of the week and it just isn’t helping the share price neither did Steve’s benzinga presentation. Market backdrop is not great and if it gets weaker the lows on tpco could be in jeopardy of being broken. I’m certainly not planning on holding this through earnings results.
MSOS was buying again yesterday. They’ve added 1M shares in around a week. No idea what their intended position is but they’ve gone from 2.1 to 3.1M shares quickly. I imagine outside of Indus and Columbia Care the manager may want more Cali exposure. The jury is still out how this stock performs when it reports earnings. I expect opex to be ugly. All imo
Back in gramf for a trade at 10.40. The stock was very strong yesterday on a brutal day in the markets and the sector, which was a new sign of strength. Also, I like the chart and risk reward setup. MSOS has been buying recently ...not sure if that continues but it has proven to be very price supportive for many stocks in the sector. Also chart has firmed up which may suggest the post despac block sales are done, although not sure about pipe lockup expiry. I’ll need to double check that so there are no surprises. This stock trades thin but with msos potentially back stop buying support areas along with a number of upcoming presentations we may finally get some price movement and some technical strength. All imo
Developments continue to just get better and better for this company...
This pending legislation, if it becomes law, would immediately change the revenue and earning potential for this company. Even near term projections would need to be modified higher.
#BREAKING New draft #cannabis legislation published by the Colombian government this week will allow for flower exports following requests from domestic producers, opening the door for exports to Europe and neighboring markets. https://t.co/DbfUVgo3FD pic.twitter.com/J8Vu9SNOXL
— Prohibition Partners (@prohibition_p) February 21, 2021
Yeah...the trade argument is growing stronger for gramf as long as the setup is there obviously. I’ve been programmed by the heavy block sells keeping a lid on the shares. Possibly that selling is complete? Jury is out for now... 12 and 12.50 are the resistance lines to watch imo. If the hype machine clears those hurdles with strong volume and importantly on a closing basis then the momo Reddit crowd may have even more fun than just a quick 20%+ scalp trade.
Friday was an excellent move...but the Chart still has a lot to prove as does the company... certainly not ruling out a strong continuation of Friday’s move next week but I’m always circumspect of these hype type moves. Nothing yet has changed from an operational or M&A standpoint except for a pre announced jay z media spot....I believe Steve is keynote speaker for an upcoming Benzinga presentation next week as well. The stock gapped up Friday so I missed my entry on the long side but I’ll see if the short side setup is a better proposition next week.
Thanks, I was unaware of that.
Wow you really get to see the low float fuel this one has when some Reddit and hoodie traders position themselves ahead of a media spot. It gapped up from the get go all due to this Jay Z spot for Monday. It’ll be interesting if the institutional block selling squashes this later today or if they let it run all the way up until right after air time on Monday. If the traders can get it over that 12ish resistance, it could get some legs.
Yeah that may be good for a point or so run up ... I’d imagine it will trade up today in anticipation of the Monday run up but unless he has an exciting announcement I’d imagine there will be a mad rush out the door as the hoodies exit post haste.
Thanks for the reminder. Lot of buzz about this one and I’ve done zero dd on it.
Cheers! May wander over and have a look...
Are there any investors here who are holding long and have done some dd on the company and the sector? The post despac scenario played out like clockwork with the stock but I’m considering a long entry based on the expected tailwind of an accommodative Fed holding down the rates for a prolonged period and enabling a continued bullish RE market...but the fly in the ointment and major headwind appears to be the 10 year’s furious rally since last August. I look at RKT as the sector darling and it’s been in a drawn out sideways trading pattern since September. Ive really not invested in this sector before so I am curious for others thoughts on the company and the economic backdrop. On the surface the recent earnings were very good but the stock has been up against institutional sellers not subject to lockup post despac and the inverse correlation to the 10 year...at least that’s my understanding.
Although mostly unrelated to TPCO, It’s worth a listen, however, Michael does not come off well. The haphazard nature of how he pulls these things together is bizarre to me. Perhaps he’s a mad genius!? The way he described the pivot from REIT to Canndoc did not engender a huge amount of confidence.
The investor presentation also is applying the estimated Q4 2020 revenue projection as a backward 2020 run rate (essentially rewriting financial historical data for the first 3 quarters), so they show a more a palatable EV multiple, which is an extremely questionable practice and a red flag. Also there’s no mention of how they modeled their forward projections which is a huge deal because Israel will probably not go full recreational until Q1 or Q2 2022, according to Michael’s current best guess, but it’s all open to political red tape and guessing at this point. So, they should be modeling projections conservatively and assuming only the medical market is available for revenue/earnings and yet there’s no mention in the presentation, which means they’re probably not. Another red flag for me. But if it drops like a rock post despac it might be an opportunity on the long side. The company is undoubtedly going to be a dominant player in Israel and while that’s a small country, they are one of, if not the most sophisticated and discriminating market in the world and as the presentation infers, this company could control upwards of 30 to 50% market share of a country which once fully legal could do 2B annually. Very disappointing they do not have warrants with this spac. All imo
Certainly wasn’t trying to imply anything....I simply offered a response to what came across as a rather uninformed post. I may be jaded from seeing way too many uninformed posters on yahoo finance who don’t even know what an MD&A is.
Q4 will not provide revenues that move the needle much at all. Chris’s last interview guided to expect minimum of 15% topline QoQ and based on the script numbers reported for Latam thus far by Alvaro and the very slow momentum in UK and complete lack of any sales in Brazil or Germany, the numbers just aren’t going to impress yet. This latest move up in shares I believe was more to do with momentum in the sector with M&A activity increasing and US events giving new life to the industry. For Khiron obviously Brazil coming online, hopefully very soon, and Mexico legalizing and rolling out a finalized medicinal cannabis framework could both prove to be major catalysts. All imo
Haha! Nicely put and sadly I can say the same. Lately it’s getting a bit manic out there...reminds me of 1999 a lot...I’ll put a company on my watchlist, kick the tires, read the md&a, review chart, consider it a maybe and see that it’s tripled...that happened with BBM ,TTM recently and even Bhang shot up 100% in a few weeks. PCLO trades at an EV around 425M and they have recorded virtually no sales yet. Microcaps are charging up on thin air which is a sign of the late stages of a free money induced drunken stock mania. I’m certainly not calling a top but I have a feeling volatility is going to increase further this year and it’s going to be important to not be a blind long without either some shorts, inverse funds or some form of hedging one’s portfolio. Just an opinion...
There’s a chance the gap down around 12.90s fills. Despite strength on Friday both the RSI and MFI did not confirm the move which suggests a short term divergence. Just a short term view here. I’m very long this company but like to view trade setups from all angles. All FWIW.
Yeah margin is a wonderful tool but many many investors do not respect it properly. In a mania it’s free money all around and almost every trade goes well. I am far more gun-shy than most with margin having been schooled many times by its shadow side but I do use it lately when risk reward setups are there, either on long or short side. I do understand some of the brokers tightening things down lately..it’s a bit nutty out there. As I said it reminds me a lot of 1999, the momentum and the next winner makes the lather rinse repeat cycle rather addictive until, of course, the music stops. I like CLVR a lot. I did not buy the latest dip. Ive got enough warrants already.
You’re welcome.
Yes I’m still watching the chart of the commons and eyeing potential entries for a trade. The warrants may never get to my entry level which is fine, I’m not chasing. Too many unknowns around operational execution at this point for me to pay such a premium for warrants or even to hold commons longer than for just a swing.. But if decriminalization happens this company may get a pass and the stock doubles. Anything can happen these days.
Your Advice on what?
That’s interesting about the fidelity move - certainly points to the current manic times in the markets. Starting to remind me a lot of the 99 equity bubble where momentum and fomo drives valuations to absolutely absurd levels. We’re definitely seeing that in spac land.
Who is your broker?
Prospectus link below, review appendices for all financials and md&as
https://static1.squarespace.com/static/5bba7efd797f743dc1838c4f/t/5fdc0260e2d6bf5258e365b8/1608254479645/Prospectus
Company website
https://www.theparent.co/
Pro forma outstanding shares are 116.7M + 5.6M earn outs. Per slide 28 of corporate presentation.
Nice to see Michael acknowledged the issue. Caliva was the best way to go imo. I saw a very good video interview on Caliva several years ago and I was very impressed and also disappointed they were private. I’m less impressed with Caliva on paper though - as I said they have so much work to do to improve their margin profile.
The company prospectus appendices contain all Q3 financials - Caliva, LCV, Sisu and a couple additional subsidiaries. Q4 are not out yet.
They have a ton of capital, so they have time to fix the massive cash burn issue,while they plan to amalgamate to maximum efficiency. I get the potential but to underestimate what an undertaking it is to pull this off is not looking at reality. Michael is a good spokesperson for the company but frankly every interview he did he was lobbed a lot of easy pitches. Of all the interviews no one asked about the terrible operational efficiency or historic return on capital of each of these businesses and no one asked just how challenging they expect it to be to cobble all these organizations together and get them all working efficiently from the same playbook. 2021 is not about the topline for this company. For me it’s about the opex.
There is a lot of money coming back into the sector. If msos and other funds decides to make this a larger position the shares could go on a run. Speculative buy is the best way to view this one as they prove themselves, which is why I like the idea of playing the warrants if they come down further. They are still too expensive. All imo.
Surely you jest...I realize that many investors have gotten coddled by companies catering to the bring on the hype crowd but c’mon man... Aside from the possibility of an acquisition announcement to move the needle, the reality is retail interest cannot overcome original spac institutional money exiting the stock and riding the free warrants. The chart will let us know when those sellers have exhausted their inventory and it could be quite a move when that happens but this company has soooo much to prove from an operational standpoint. See all amalgamated companies last quarterly financials and the sea of big red numbers. 2021 better be a sleeves rolled up year because they have a monumental amount of work to do. All imo
I provided my thoughts in other posts already. I will let the chart and the company NRs speak and trade accordingly. I’m certainly not underestimating the potential but I want to see how they execute. I have warrants on watch for now as I see them as the better way to play this. All imo
Completely disagree. But hey that’s what makes a market. Good luck
Technically and fundamentally there is still a lot to be proven. Companies with lots of capital in that perceived leader category have been running strong and gramf is riding the wave. The sum of the parts better be a lot better operationally speaking than the companies amalgamated into this business. I prefer the sidelines for now until a few things line up. Warrants on watch.
Sector has turned bullish. Well capitalized players are definitely catching a bid. The possibility for the Senate to actually pass something like the MORE act for Biden sign off is becoming possible this year.
GRAMF showing signs of life. resistance in the 11.50ish area as well as the 12.50ish zone. If it tags the 12.40 to12.50 zone it would be a good sell short opportunity with a tight stop. All imo
See excerpt below from pg 154 of prospectus.
Above $18 the company can call the warrants. They will not exercise for holders. Holders must exercise or sell prior to the 30 days or forfeit the warrants altogether and end up with nothing.
I’m watching the warrants but they’re still overpriced. The spreads are oftentimes insane suggesting that despite the large amount of warrants issued there are few sellers in the market.
SCAC Warrants
RIGHTS TO PURCHASE SECURITIES
35,837,500 SCAC Warrants are outstanding as of the date of this prospectus. Each SCAC Warrant represents a share purchase warrant to acquire a Class A Restricted Voting Share following 65 days after the Effective Date (which, at such time, will represent a share purchase warrant to acquire a Common Share), at an exercise price of U.S.$11.50 per share.
The SCAC Warrants will expire at 5:00 p.m. (Toronto time) on the day that is five years after the completion of the qualifying transaction of SCAC (which is expected to consist of the Transaction) or may expire earlier upon our winding-up or if the expiry date is accelerated.
Once the SCAC Warrants become exercisable, pursuant to the terms of the Warrant Agreement, SCAC may accelerate the expiry date of the outstanding SCAC Warrants (excluding the Sponsor’s Warrants but only to the extent still held by the Sponsor at the date of public announcement of such acceleration and not transferred prior to the accelerated expiry date, due to the anticipated knowledge by the Sponsor of material undisclosed information which could limit their dealings in such securities) by providing 30 days’ notice if, and only if, the closing price of the Common Shares equals or exceeds U.S.$18.00 per Common Share (as adjusted for stock splits or combinations, stock dividends, Extraordinary Dividends, reorganizations and recapitalizations and the like) for any 20 trading days within a 30- trading day period.
The right to exercise will be forfeited unless the SCAC Warrants are exercised prior to the date specified in the notice of acceleration of the expiry date. On and after the acceleration of the expiry date, a record holder of a SCAC Warrant will have no further rights.
The exercise price and number of shares issuable on exercise of the SCAC Warrants may be adjusted in certain circumstances, including in the event of a stock dividend, Extraordinary Dividend, or our recapitalization, reorganization, merger or consolidation. The SCAC Warrants will not, however, be adjusted for issuances of shares
https://static1.squarespace.com/static/5bba7efd797f743dc1838c4f/t/5fdc0260e2d6bf5258e365b8/1608254479645/Prospectus
In answer to your question...Paltry quarterly top line growth. Continuing significant cash burn. Lack of sales or growth updates in UK, Germany and Brazil. Mexico still unofficial. Once they get to a weekly run rate of 1000 script issuance in Columbia that could possibly be a significant inflection point since for now this is primarily an early potential leader play on the Columbia B2C market . At an EV of 30M the stock is relatively cheap but will probably scrape along the bottom here waiting for a catalyst. All imo.
I cannot locate one either. Agreed, a company website should have been completed by despac day. This was not well put together. For all the pumping that the chairman did via media spots, interviews and podcasts pre closing, the debut has been a flop and did not at all live up to Auerbach’s hype. A board chairman should not be permitted to hype his stock and mislead investors the way he did. The first time I heard him project the price to be 70% higher within a week of closing I thought...potential lawsuit? Also, the first cnbc spot with Carol Bartz from the board was in a word...terrible. According to her it’s left coast vesters not ventures... talk about a credibility problem... A company board member who cannot remember the name of one of the primary companies being amalgamated into TPCO. This team has a lot of work to prove themselves and clean the egg from their faces. All imo.
The commons may be ripe for a brief oversold rally maybe into the 11s but I would not expect this downtrend to be finished as I still think there will be more original spac investors, not subject to lockup, dumping into any retail strength. Admittedly that’s all speculation. IR needs to update that presentation. Enterprise Value calculation is using the projected closing cash not actual cash at closing. 116M fully diluted shares plus 5.6M potential earn outs plus potential for 35M exercised or called warrants pegs a future F/D share count around 160M, which compared to many CAD LPs is not at all outrageous. Im very curious to see the Q4 numbers. I find their 2021 and 2022 projections to be aggressively optimistic. But if they hit them, or even come close, then this stock will be re-rated in a very big way. For now projections are just a paper pipe dream. I’m still eyeing the warrants for weakness. All imo
Not underestimating the potential of the Caliva brand but I’d certainly not characterize their operational performance heretofore as a winner. There Q3 financials posted in the appendix of the prospectus showed the company has been, so far, an absolutely horrible return on capital after 5 years of operations. The executive team has a lot of work to do to live up to operational projections , far better efficiencies and increased margins all while trying to markedly expand market share and penetration. All imo
Still watching and expecting the block selling to overwhelm retail buyers until the chart proves otherwise. Despacs are quite the roller coaster! Eyeing the overpriced warrants which are being bought up apparently by a lot of retail buyers hitting the buy button through a cloud of monogram smoke.
One minor correction...there are currently around 25M shares outstanding with about 2.5M additional earn out shares available upon share price milestones being met (also completely excluding the warrants). The current float only consists of the original SAMA shareholders who were not subject to a lockup, which is around 33% of O/S, or roughly 8.25M shares. PIPE investors shares lockup expires at 45 days post despac. All this info is from investor presentation online and the recent ceo presentation , link available on company Twitter feed.
That’s not manipulation. That’s just another big block sale overwhelming buyer demand. It has been ongoing since despac day. Company needs to generate sales and prove out the model and then buying should overwhelm sellers. All imo.
Haha..yes agreed... the spac model levels the playing field for average investors in many ways with a huge caveat to handle with care and know just wtf you are buying if you plan on holding post despac day. Agree with your renaming idea. The parent company is innocuous and bland. Caliva would have been ideal since they are well known in S Cali. Monogram is I imagine only the premium Jay Z product with more to follow.