Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Aphria earnings proves M&A thesis for CROP!!!
This morning Aphria is out with its latest earnings, for the qtr. ended 8/31/18. Sales came in at C$13.29 million. That's up nicely year-over-year, up 117%, but sequentially (qtr. over qtr.) sales were up 10.5%. Trailing 12-month sales are up 19.4% sequentially....
This means that Aphria's EV/12-month trailinig sales multiple just moved from ~130x to 109x. Even if revenue growth improves to 15% (sequentially) from 10.5%, EV/Sales would still be at ~94x. And this is for a company that has the cheapest valuation (lowest EV/Sales ratio) among Majors including -- Tilray, Canopy Growth, Aurora, Cronos, HEXO...
From 130x (May 2018 trailing 12-month sales) to 94x (estimated Nov. 2018 trailing 12-month sales) in 6 months.... this improvement is not happening fast enough! APH and other Majors have to make acquisitions, they have to buy third-party revenues to get their valuations down. If APH were to acquire CROP next year it might look something like this...
APH's trailing 12-month EV/Sales multiple a year from now (Aug. 2019), assuming 15% sequential revenue growth, would be ~64x. If they bolted on C$40 M of sales from CROP by paying 5x that $40 M figure, then APH's pro forma EV/Sales would improve markedly to ~42x. So, from ~64x to ~42x by taking out CROP, that's a no-brainer for APH.
That would be a C$200 M takeout of CROP next year, or C$1.69/shr (with existing 117.6 M shares outstanding). Assuming equity dilution from the exercise of warrants and options and new share issuance, let's say pro forma shares by mid 2019 go up by 60 M to 177.6 M, then a C$200 M takeout of CROP impies C$1.12/shr. Before readers become alarmed about an extra 60 M shares, don't get overly excited... there would be significant cash proceeds coming in if those shares are issued (note-- warrants/options are mostly at very attractive price points).
But, if the cannabis space is robust next year, APH might find itself in competition to acquire companies like CROP. In other words, maybe the 5x multiple of CROP's C$40 M in sales would be 7x-12x? Or, maybe CROP would get credit for more forward looking sales and get taken out at 5x $80 M of forward sales (say forward sales from 6/30/19-6/30/20)..... You get the idea. Even with moderate equity dilution, these scenarios imply north of C$1/shr. next year. And, 5x $80 M in forward sales, including an incremental 60 M shares issued, would be C$2.24/shr.
One more thing about an extra 60 M shares, (I'm not saying this will happen) but if it does, the capital that would be raised would be deployed to generate even more sales, so C$80 M in forward sales could be a conservative number.
Make no mistake, this is all just math porn -- CROP has no revenues yet!
FInally, someone on this board posted a sales estimate for 4th qtr. 2018 of C$10 M.... I'm assuming C$5 M to be safe, especially because CROP's portion of the sales have to be collected from CROP's tenants, which might ential some logistics and some time. The key of course is CY 2019 & 2020. I'm thinking that C$20-C$60 M in sales (net to CROP) next year covers a wide range of possibilities. And, while sales could certainly be less than C$20 M due to execution problems, sales could also be well north of C$60 M if all goes well and pricing remains firm.
That's C$20-C$60 M in sales in CY 2019 from Washington State, California & Nevada alonel... mostly from Nevada. So, zero sales from cannabis-infused beverages, zero sales from Jamaica and zero sales from Italy...
$WEED.to, $TLRY, $ACB.to, $GWPH, APH.to, $CRON.to, $MMEN.c, $HEXO.to, $CARA, $MRMD... what do these 10 names have in common? They are among the top 15 #cannabis /#hemp plays in the world (by Enterprise Value) that trade at high Sales multiples...
Their avg. trailing 12-month EV/Sales multiple = 228x! Let's say (on average) sales from these 10 quadruple (+300%) in the next 12 months, then their avg. EV/Sales multiple for CY 2019 would be about 57x. Of course, of those 10 names, some will see sales up more than 300%, but some will have less sales growth.
At 57x, (call it 60x or 50x or 40x...) - they have no choice, they have to acquire 2019/2020 revenues. They can't grow fast enough from existing operations, they have to do M&A....
Internal growth might get them +100%, +200% +300% in sales next year, but only M&A gets sales up +400%, +500%, +600%...
If the average trailing multiple of these 10 names (228x) were to improve by 600%, it would fall to 32x. But, not all of the big players will be able to grab these external revenues-- some of the top company's 2019 multiples will remain well above 30x. So, the Majors, at least these 10 names -- could they afford to pay a 3x, 5x or 10x sales multiple for CROP? YES!
Will CROP be the ONLY #cannabis #hemp "junior" to be acquired at 3x-10x 2019 (or 2020 sales)? NO! Many will be acquired, many stocks have very substantial upside from here, the ones in the sweet spot - trading at low 2019 Sales multiples with strong growth prospects and in good market segments - Hemp & USA (Nevada) are very good segments in my opinion...
With today's news, it seems possible (there's plenty of risk, no guarntees), but it seems possible that CROP will be trading at an EV/Sales multiple of 1x (or lower) from Nevada opportunities alone.... At C$0.56, we are at an EV of C$64 M = US$50 M. That's approximately #108 on my list of about 200 U.S. & Canadian-listed names.
I argue that while there are dozens of names likely to be acquired by the top 40-50 players (by EV), there could be bidding wars for the best ones.
And, there's an appetite for many more acquisitions by the Majors then there are GOOD QUALITY players with near-term revenues and low valuations... Majors will be forced to move fast, to acquire new revenue sources, not merely because it's prudent and highly accretive, but to not allow a fierce competitor to gain advantage..
What am I missing? The trading technicals. I have no idea where the #cannabis / #hemp names will trade in the next few days or weeks. So, CROP and others could trade lower before going higher next year.
CROP.cn CSE: CROP -- new feature article on CROP --
epsteinresearch.com
And, this blurb on hemp in the U.S....
According to an in-depth analysis of the hemp CBD market by the Brightfield Group, hemp-derived CBD products could surpass the cannabis market by 2022. In fact, the Brightfield Group’s report predicts the CBD industry will explode beyond its current value to $22 billion by 2022.
The report’s predictions are based on the expected passage of the 2018 Farm Bill, which will classify industrial hemp as an agricultural commodity and remove industrial hemp from the U.S. controlled substances schedule. The report reveals that descheduling hemp will open doors for a number of industries to enter the hemp market.
MarketWatch says the U.S.-based hemp CBD industry almost doubled from 2017-2018. Hemp CBD’s current growth alone is unprecedented because it has primarily been driven by word of mouth. Once industrial hemp is removed from the schedule, advertising could skyrocket, further propelling the market to new heights.
CROP Mgmt. claims to be # 1 in hemp in the State of Nevada. If true, that would be huge with passage of the Farm bill as soon as this week...
Nano One Materials $NNO.v #lithium #Paul Matysek #Nanostructures #batteries #Li-ion Excellent article by a Seeking Alpha author. Check it out
insert-text-here
Feature article out yesterday/today. Timing not ideal to say the least. Still, the fundamental thesis remains intact. Assuming one is looking to invest in a uranium stock, URRE seems to be a good bet.
epsteinresearch.com/2016/01/06/urre-11_28/
Some articles I've post over the past 5-6 months.... All featuring Ucore Rare Metals. Holiday reading for serious investors.
EpsteinResearch.com/2015/09/23/interview-of-ucore-rare-metals-ceo-chairman-jim-mckenzie/
EpsteinResearch.com/2015/08/18/170-days-since-ucore-rare-metals-blockbuster-news-yet-stock-price-lower/
EpsteinResearch.com/2015/07/23/must-read-report-on-ucore-rare-metals-by-chris-ecclestone-of-hallgarten-company/
Dajin Resources, the Right Place and Time in Nevada’s Lithium Hub (Update)
By Peter Epstein, CFA, MBADajin Resources, Interviews, Lithium, Lithium Brine Harvestiing, Lithium Hard Rock Mining, Mining stocks, Pure Energy
On a slow Friday, September 4th, I put out the article that can be seen below. As a brief update, I note that Dajin Resources [(DJI.V) & (DJIFF)] is up nicely today, Sept 8th, on heavy volume, (10x average on DJI.V alone). Over the long weekend, an interesting, but seemingly routine article on lithium was posted. Not from a well known website or an update on any lithium companies. Just a bullish lithium piece from an unknown (to investors) website named PV Tech Storage. This kind of article is exactly what I expect to see more of. In the interest of keeping Friday’s article reasonably short, I deleted a paragraph that I recreate here. Admittedly, there is at least one other catalyst driving Dajin Resources higher today, Sept 8th. Dajin got a bullish mention from Jeb Handwerger of GoldStockTrades.
Regarding Dajin Resources’ strategy of controlling thousands of acres of highly prospective property in key locations of Nevada, we’ve seen this movie before. In the Athabasca uranium belt, several, “out-of-the-money,” small caps moved up by multiples even as the uranium price sank. Drilling results of nearby companies proved to be a catalyst. Early investors to select names in Alberta’s Oil Sands turned out to be high risk but even higher reward bets. The same can be said about valuable acreage in the U.S. shale oil & gas basins. Initially, only property that was in the sweet spot, “the fairway,” was picked over.
Select juniors lucky or smart enough to acquire land just outside and around the fairway did extraordinary well. The value of acres underlying the market caps of several U.S. shale oil & gas juniors increased by 10x-50x. This is the way in which the market works, out-of-favor sectors come to life, sometimes explosively, on what appears to be routine news, but news that happens to be, “the straw that broke (breaks) the camel’s back.” We are certainly seeing that with Dajin Resources and Pure Energy Minerals [(PE.V) & (HGLMF) of late.
Dajin Resources, the Right Place and Time in Nevada’s Lithium Hub (Update)
Last week, Tesla Motors announced that it had agreed in principle to an off-take agreement with Bacanora Minerals Ltd. (located in Sonora, Mexico) and to a lesser extent, its joint venture partner, on a portion of their properties, Rare Earth Min. Since then, Bacanora’s stock is up approximately 40%. At first, I was surprised Bacanora’s stock didn’t soar even higher. It turns out that the off-take agreement has a number of contingencies and no financial commitment from Tesla. In fact, Tesla’s Elon Musk was quoted as saying, “this lithium deal is not exclusive (and) has many contingencies. The press on this matter is unwarranted.”
The point of the opening paragraph is not to marginalize the good fortune of Mexico’s Bacanora, they have certainly staked a coveted spot! Instead, I believe it has significant and important ramifications for lithium juniors in Nevada. There’s Dajin Resources [(DJI.V) & (DJIFF)] Pure Energy Minerals [(PE.V) (HMGLF)] and the proposed [Western Lithium / Lithium Americas] merger and of course the currently producing Rockwood Lithium’s brine operation.
Clearly, more than one of the above will get the green light. In fact, I’m laying out a thesis that, over time, all existing Nevada lithium companies will be keenly sought after. I find it noteworthy that Tesla’s first move to secure lithium supply was choosing a company that remains years from production. To be fair, Bacanora is more advanced than Western Lithium, Dajin Resources and Pure Energy. However, the fact that Tesla is looking so far in advance and might soon announce deals in Nevada, is telling of Musk’s longer-term strategy. Remember, Musk believes, “the need for lower-cost batteries for autos and power storage means there will need to be hundreds of, “giga-factories…”
Can Long-Term End Users Avoid Tapping Every Viable Lithium Source?
If Tesla is largely confined to North America for its raw materials, as is reported to be the case, Nevada is surely a great place to be. The State offers security of supply not just for Tesla in Nevada, but for giga-factories globally that are sure to follow. There are not that many lithium juniors, except a dozen or two with little more than a potential deposit, in places like Serbia, with no cash or the ability to raise capital. Hope is not a strategy.
Tesla and others will need ALL of the lithium supply from any economic deposit in a known, safe jurisdiction like Nevada. It’s a question of when, not if, investors wake up to Nevada’s small cap lithium opportunities. Even companies in Nevada that might be 5 + years from production are still years ahead of green field prospects. Dajin Resources is an early-stage play, but it has invested capital, drilled holes, and staked some of the most prospective property in Nevada, as well as in Argentina. Dajin has a committed shareholder base and the demonstrated ability to raise capital, including from the ongoing exercise of in-the-money warrants.
Yes, Dajin is an earlier stage play than Western Lithium and Pure Energy. However, there will be room for more than just one winner. Dajin controls almost 7,000 acres in Nevada and an enormous land position (roughly 250,000 acres) in Argentina. Investors in Dajin get a long-dated call option in Argentina for free. How large a holding is 250,000 acres? Lithium Americas controls about 200,000 acres, which was no doubt an attractive attribute to Western Lithium’s stakeholders. Although at early stage, in the long run will that matter if lithium demand shoots higher like Musk and others appear to believe? I think not.
The bottom line is that there are probably 10 or fewer pure-play, lithium juniors with a shot of reaching production, (there will be more joint ventures, farm-outs and takeovers). Therefore, green field explorers and higher-cost projects in Australia (and elsewhere) will never see the light of day. In my opinion, Musk tying up a portion of Bacanora’s output would not be a meaningful part of his aggressive long-term demand expectations. Bacanora might end up supplying just 10% (my guess) of its lithium output to Tesla’s first giga-factory. Security of supply means multiple sources for multiple end users.
Conclusion
Tesla and others to follow will demand consistent, high quality, on-time delivery from a wide range of sources. If Musk keeps to his pledge of obtaining raw materials solely from North America, he will likely be all over Nevada’s emerging production, timing unknown. Not to be lost in the analysis is that Musk not only wants to secure his own growing needs, but is likely to be searching for opportunities to thwart competition.
As soon as the likes of Buffet’s BYD, LG Chem, Panasonic, NEC, Samsung, Sanyo, etc. begin announcing off-take agreements, the world will see how critically important the 10 or fewer lithium hopefuls are. Dajin Resources is a favorite of mine, but not my only. There’s ample room for any and all lithium supply, especially secure supply, to meet demand for the next few decades. Yes, I’m bullish on lithium. Yes, I’m bullish on Dajin Resources.
Disclosures:
Several of the companies mentioned herein have small market caps, including Dajin Resources, Pure Energy, Western Lithium and Lithium Americas. Small cap stocks are speculative, not suitable for all investors. I, Peter Epstein, own shares of DJIFF and PE.V. Mr. Epstein, CFA, MBA is not a licensed financial advisor. Readers should take that fact into careful consideration before buying or selling any stock mentioned. Readers are encouraged to consult with their own investment advisors before buying or selling any stock, especially speculative ones such as Dajin Resources, Pure Energy, Western Lithium and Lithium Americas. At the time that this article was posted, Dajin Resources and Pure Energy were sponsors of: http://EpsteinResearch.com. Please consider visiting: http://EpsteinResearch.com for free updates on Dajin Resources, Pure Energy and others across a wide range of sectors. While at http://EpsteinResearch.com, please enter an email for instant delivery of all my work. Thank you for supporting my articles & interviews.
http://EpsteinResearch.com/2015/07/29/pure-energy-minerals-poised-to-be-one-of-a-few-lithium-winners/
Excellent Pure Energy CEO interview. Stock trading with heavy volume.
http://epsteinresearch.com/2015/07/29/pure-energy-minerals-poised-to-be-one-of-a-few-lithium-winners/
Excellent Pure Energy CEO interview. Stock trading with heavy volume.
I've been following Ucore for several months. This company is the real deal. $145 million pre-approved loan from State of Alaska. MRT proven at bench scale, but already at commercial scale in dozens of applications. I've been told that banks, hedge funds an private equity want to loan Ucore additional capital subject to the Alaska loan coming to fruition. Therefore, there's a good chance that equity dilution over the next few years could be fairly limited compared to hundreds of peer natural resource companies.
Jack Lifton, one of the true experts on REE, is a big fan of Ucore. Jack is a consultant for Ucore, so that might make some reading this turn away, but check out this article. Jack is candid in my opinion, he sometimes rips companies apart. He doesn't need to be working at his age, he loves what he does. He turns down natural resource companies that seek him out all the time-- I bet 5-10 rejections per month. Please read the following informative and entertaining article by Jack Lifton--
http://investorintel.com/rare-earth-intel/rare-earth-technology-officially-overtakes-geology/
Vancouver, BC – April 6, 2015 - Dajin Resources Corp. ("Dajin") (DJI-V: TSX) (DJIFF: OTC) is pleased to report that being “Blue-Skyed” for the capital markets in the USA may help increase Dajin's exposure and liquidity as we move our Teels Marsh lithium project forward. Being “Blue-Skyed” creates the potential for upwards of 100,000 investment advisors to introduce Dajin to retail investors in small cap companies such as Dajin Resources Corp.
Dajin is committed to increasing its markets exposure to a large potential audience. Dajin will now include direct links in our press releases and on our website to our “Blue Sky” data base more commonly known as The Standard and Poor Market Access Presentation. This feature will provide investors visiting our website, access to the same independent profile S&P Capital IQ is now providing to brokers / financial advisors, institutions, traders and self-directed investors. http://reports.standardandpoors.com/aidata/maccess/pdf/23406720.pdf
About Dajin: (www.dajin.ca)
Dajin is an early stage energy metals exploration company holding a 100% interest in claims known to contain lithium and boron values in the Teels Marsh region of Mineral County, Nevada. These claims, which cover 2,191 hectares (5,414 acres), are located adjacent to the site of US Borax Corp’s first borax mine.
Dajin also holds a 100% interest in concessions or concession applications in Jujuy Province, Argentina that were acquired in regions known to contain brines with potassium, lithium and boron values. These concessions total approximately 100,000 hectares (247,000 acres) with 80,248 hectares (198,000 acres) located in the Salinas Grandes/Guayatayoc salt lakes basin adjacent to concessions held by Orocobre Limited (ORL-T: TSX), who is partnered with Toyota Tsusho.
New feature article on CVM
http://epsteinresearch.net/2015/03/09/cel-sci-most-undervalued-company-in-a-phase-iii-trial/
Does NSP Have Anything at all to do with Medical Marijuana?
NSP sells hemp protein powders and is moving into hemp omegas, (or are they the same products being re-marketed for their omega benefits vs protein benefits)?
Simple question- does NSP have anything at all to do with the cannabis that has THC in it, i.e. either medical cannabis in Canada or recreational cannabis in Colorado, USA?
Interview of CEO Steve Alfers, Feb 4, 2015
http://www.talkmarkets.com/content/stocks--equities/pershing-gold-reports-by-far-its-highest-grade-results-a-game-changer?post=58171
Best Drill Results by far reported today, Feb 4th
http://ir.stockpr.com/pershinggold/press-releases/detail/734/pershing-gold-reports-a-2-24-ounce-per-ton-gold-intercept-along-with-other-high-grade-gold-intercepts-at-relief-canyon
New button on top right side of Gainey's home page-- Chinese translated option to view the website. Clearly something going on with the Chinese, not saying a buyout or anything, just interested Chinese investors? All we need is small volume to move this stock up. I hope the Chinese can trade Canadian listed stocks!
http://www.gaineycapital.com/
http://www.nai500.com/microsite_view/73047/1
VANVOUVER, BC / ACCESSWIRE / February 3, 2015 / Gainey Capital Corp. (GNC.V) (GNYPF) ("Gainey" or the "Company") is pleased to announce its 100% owned/controlled Mexican Sub Corp, Minera Buena Fortuna S.A. DE C.V., has signed a new "Working Agreement" with the San Francisco De Lajas Indian Community in the State of Durango, Mexico. Gainey owns and operates mining concessions of approximately 6,000 Hectares in Durango and has recently identified several new mineral targets in these concessions. The agreement includes increased access to a large number of skilled local workers, which will facilitate Gainey's plans to begin bulk-sampling its own ore from its advanced 300 TPD mill and processing centre in 2015. The agreement will also support the company's aggressive 2015 exploration plans, details of which Gainey expects to announce by the end of February.
David Coburn, CEO of Gainey Capital, commented, "Our 2015 plans are aggressive, both for ore processing at our mill and also exploration. Durango is a very pro-business and pro-mining State and we're excited to begin exploration work in our Durango concessions this February, as per the agreement."
Gainey Signs 10,000 Ton Ore Processing Agreement
Gainey now taking delivery of high-grade ore at its advanced mill and processing centre
Gainey Capital Corp. (TSXV: GNC) (OTCQX: GNYPF) ("Gainey" or the "Company") is pleased to announce that Belmex Resources has engaged Gainey to process a minimum of 10,000 tons of high-grade gold ore at its 300 TPD (tons per day) mill and processing centre in Mexico's prolific gold and silver region of Sierra Madre. Gainey has begun taking delivery of the ore (assay grades from 5.8 to 12.2 GPT), delivered by truck from Belmex's facility just 22km from the mill.
Gainey's facility is the only one in the region that includes a gravimetric/flotation processing center to optimize gold and silver recovery rates. Its operational team is run by Gainey Operations Manager, George Cantua, who previously supervised Barrick Gold's 24,000-tpd mill in the Dominican Republic.
David Coburn, CEO of Gainey Capital, commented, "We located our facility close to a large number of ore bodies specifically because there was no other mill in the region. We began sampling ore from multiple sources just days after completing our upgrade program and today's announcement shows we have started the next phase of the toll processing part of our business."
About Gainey Capital Corp.
Gainey Capital is a gold and silver exploration, development and ore processing company exploring an aggregate of 18,766 hectares strategically located in the gold/silver-rich Sierra Madre Occidental Trend in western Mexico. The company's Mill, located on its El Colomo property property, is capable of processing up to 300 tons of ore per day and the company has the capability, including permitting, to upgrade to 600 tons per day with low capital expenditure. Additional information on Gainey Capital, its current operations and its vision is available on the Company's website at www.gaineycapital.com or from info@gaineycapital.com .
Latest feature article on Gainey Capital. Good to see some news outlets picking up the Gainey story. Please check out link.
http://www.baystreet.ca/articles/stockstowatch.aspx?articleid=20564
Hopefully news coming out this week on Gainey Capital. Strong stock price movement so far today, (Tuesday)
Hopefully news coming out this week on Gainey Capital. Strong stock price movement so far today, (Tuesday)
This company is absurdly cheap if they can execute their business plan. Once Gainey buys another ball mill, it will have 600 tonnes per day (tpd) capacity. Compare that to Inca One at 100 tpd and Dynacor at 250 or 300 tpd. Mexico a safer place to do business then Peru
Gainey is coming across some high grade ores from neighbors seeking toll milling. Grades not as high as Dynacor's, but still quite strong.
Now all we need is some press releases out of the company
8-k filing hitting the tape an hour ago....quote,
Another vote of confidence in the upside potential, (subject to management execution) of Verde Science.....
Verde Science, Inc. (VRCI) (OTCQB: VRCI) is pleased to announce the appointment of Bradley J. Dixon, J.D. to the Board of Directors. Mr. Dixon is a trial attorney and partner in the Boise, Idaho office of Stoel Rives, LLP, which has locations throughout the northwest and California. Mr. Dixon is ranked by Chambers and Partners and was named in the 2013 Mountain States Directory of Super Lawyers. He has a wide range of litigation experience, which includes Agricultural, Natural Resources, Labor and Employment, and Product Liability cases. Mr. Dixon's trial experience representing clients through complex litigation on a broad range of disputes including complex commercial litigation, employment, insurance coverage, products liability, title insurance, foreclosure and bankruptcy trial practice, as well his governmental affairs service experience meshes well with the future needs of Verde Science.
As Verde Science has developed into its current complex structure, it became apparent that legal oversight from an experienced attorney such as Mr. Dixon was a requirement. The business now consists of multiple interconnected facets, which include the scientific and engineering sides of the aeroponics and hydroponics marijuana grow business, management consulting services, capital funding services, and basic research and development into future prescription drugs.
Ken Berscht, CEO of Verde Science, stated, "I am very pleased to have Brad on our Board of Directors as he brings a tremendous amount of relevant experience to our company. With his broad legal background he can help guide us through the challenges of this business as it matures and spreads to more and more jurisdictions. Brad broadens the knowledge base of our board which will help position Verde Science as dominant force in the medical marijuana market."
About Verde Science
Verde Science plans to take an all-encompassing, integrated public health approach to medical marijuana with a focus on becoming the leader in providing services to legal, licensed cannabis cultivators and dispensaries and their patient community. Verde's focus, in collaboration with its partners, is on deploying an advanced array of technical services to foster an integrated health care model in legal jurisdictions in North America.
The Company provides a variety of products and services to its clients by using best practices to ensure the best quality of product, produced with focus on cost control and legal compliance. Verde Science is meticulous, measured and diligent with an absolute focus on compliance while offering growers and their patient community unsurpassed, fully integrated, holistic health care products and programs.
Verde Science is one of the initial corporate players in the medical marijuana industry providing sophistication, controls, standards and innovation. The company has and will continue to assemble a highly experienced team that will deploy state-of-the-art technology and a superior methodology to enter and take meaningful market share that can be repeated and expanded as more and more jurisdictions adopt legal use of cannabis products to address health care issues.
I think the changing of the guard at Verde Science is highly significant. Bringing in new blood, not just the newly hired Ken Berscht, but also Technical Board advisor Paul Pelosi and new Board member Luis Bobadilla...is important and an unqualified vote of confidence in the business proposition. I also know for a fact that there are at least 2 extremely important people working behind the scenes that have a lot of excellent ideas and are working tirelessly to right this ship. I know this because I speak with these two people from time to time.
I'm not saying that VRCI is a MUST BUY stock today or this week. But, I'm saying that fresh looks have given the new business model a seal of approval. The company remains highly speculative, but at 5c per share and with new people signing on, I feel comfortable saying that VRCI appears to be an interesting spec play with compelling upside vs. downside.
Compared to other medical marijuana companies, Verde has not seen its share price rise by 1,000% or 10,000% like some others, it's sitting near a 52-week low. The market cap is just $5.4 million, hardly an aggressive valuation. There is considerable, "option" value in Verde's stock at 5c. A lot of holders who wanted out have been able to exit over the past 2.5 months. For holders who have been sellers or have been considering selling, perhaps it's time to hold off and give the new Verde team another chance? I know that excitement and confidence within the company is growing.
If Verde can announce a number of clients willing to utilize its technology services, then revenues should start to flow this year. It would not take more than 3-5 clients to prove that Verde has very substantial prospects. So far, Verde has just 1. So, this remains an execution story. But, when I compare the risks of getting customers that are looking to vertically integrate their dispensaries to the risks facing the Canadian LP business model-- where a number of companies like Tweed (TWD) and Creative Edge (FITX) trade at market caps in the hundreds of millions, $5.4 million mcap Verde doesn't seem so bad.
Verde, Creative Edge and Tweed have very similar trailing 12-month revenues through the last completed quarter of 3/31/14. Each has revenues of approximately $0.00. So, I ask myself, which company is more likely to double/triple or be a multi-bagger in the next 6-12 months? The hundred million dollar market caps, that have already soared and are multiples above their respective 52-week lows, or Verde, near its 52-week low with a $5.4 million market cap?
SALT LAKE CITY, June 10, 2014 (GLOBE NEWSWIRE) -- American Sands Energy Corp. (AMSE) ("AMSE" or the "Company"), an oil sands exploration and development company operating in Utah, is pleased to announce that William H. Champion, an experienced mining industry executive, has been appointed to the Company's board of directors.
Mr. Champion joins the board of directors having most recently spent over eleven years with Rio Tinto PLC, during which time he managed various mining subsidiaries. While at Rio Tinto, Mr. Champion's roles included:
Managing Director of Rio Tinto Coal Australia (2009-2013) where he was responsible for the operations of six open pit and one underground coal mine with annual revenues of approximately $ 4.5 billion, annual earnings exceeding $1 billion and over 4,500 employees,
Managing Director of Rio Tinto Diamonds (2007-2009) with responsibility for three diamond mines producing 35 million carats annually,
President and CEO of Kennecott Utah Copper Corporation (2002-2007), one of the largest open pit mines in the world, with revenue of approximately $2.5 billion and earnings of approximately $1.5 billion.
"I'm delighted to be joining the board of American Sands," said Mr. Champion. "AMSE has an exciting project at Sunnyside and a technology that has the potential to be game-changing in the unconventional heavy oil sector."
"We welcome the addition of a mining veteran of Mr. Champion's caliber to our board of directors," stated William Gibbs, AMSE's Chairman and CEO. "His years of successfully running Utah based mining facilities along with his significant experience managing mines, always with a focus on safety and sustainability, will be instrumental to developing our operations as we turn our focus towards commencing production."
AMSE has huge blue-sky potential. Of course, each investor should discount the ultimate upside in the stock based on his/her own view of the likelihood of reaching the blue-sky potential. But, the bull case is $10 per fully-diluted share, (pro forma for the $75 million capital raise coming early next year). Note, not all of that $75 million will be equity, there could be a debt component.
At first blush, $10 per fd share sounds wildly optimistic. It would probably take 2-3 years to get to $10/share, but if AMSE can 1) get permits issued 2) raise $75 million of equity + debt and 3) get oil flowing by 2h 2016, then the probability of the company being able to fund, build and ramp up a 50k bpd facility 4-5 years later goes way, way up. Since the permitting and funding hurdles are closer to 1 year away, I think the stock could comfortably double or triple within 12 months.
How much of a haircut should AMSE receive for it's funding and permitting risk? Well, those are important challenges for sure, but compare a raise of $75 million with a raise of billion(s) for some potash and iron ore juniors. Compare 2 years until 1st production with 5-15 years for some oil & gas, potash and uranium juniors. Compare infrastructure access in Utah to that of Africa or central Asia. Compare rule of law in Utah to that of frontier or emerging countries in Africa and elsewhere.
AMSE is highly speculative, but the KEY risks of permitting and funding for a project in Utah seem to me to be mild (on a relative basis) to the myriad of risks facing so many other natural resource companies. Yet, the BIG upside remains for both AMSE and those other high risk plays.
Video Clip of Paul Pelosi, advisor to Verde Science.
A Promotional Piece Written on Verde Science....
LOS ANGELES, June 2, 2014 (GLOBE NEWSWIRE) -- Most of the U.S. lacks strong corporate players in the cultivation and distribution of medical marijuana. In short, the industry is largely mom and pop type organizations many of which are run by folks who were either users or suppliers or both prior to legalization. The key to success will be the delivery of high quality consistent potency products, month after month, year after year. Companies that can withstand ever-increasing market volatility will capture sustainable market share. Market share gains will come from buyouts of marginally profitable competitors but more importantly from product branding. Branding requires proper quality control and on-time delivery that only a sophisticated well-run organization can accomplish.
Verde Science (OTCQB:VRCI) does not want to own dispensaries, because that would be quite limiting to the scale of their business. Rather Verde wants to be a service provider to the dispensaries. Verde will provide capital for expansion and operation. This business aspect is huge, because the dispensaries have no access to the capital markets through banks or otherwise. Also many of the dispensaries do not have the ability to grow their own high quality product and thus outsource this to someone else who makes a large profit selling marijuana to them. In this case they have no control over product quality.
Verde has state-of-the-art in growth technology, aeroponics, which will save the dispensaries tremendous amounts of money and provide them with in house quality control, which the Company will help them to ensure. In exchange for their capital and consulting services, the dispensaries will share a large percentage of their increased profits with Verde in the form of a monthly management fee and a royalty on all product sales.
Recent analysis on the American marijuana marketplace by ArcView Angel Investors forecast a 64-per-cent surge in the legal U.S. cannabis market to $2.34-billion in 2014. It also estimates that the five-year national market could grow to $10.2-billion amid rising demand and potentially new state markets. This type of market growth will create tremendous opportunities as well as a load of competition from largely under-qualified participants. Los Angeles County, where Verde is initially operating, is the largest medical marijuana market in the world.
Companies and individuals looking for success have to embrace the fact that investing in Medical Marijuana isn't about getting bigger; it's about getting smarter. The cultivation of the medical marijuana market is in flux. To thrive, successful, long-lived cultivators will need to be nimble, well organized and highly compliant on the legal and regulatory fronts. As well, investors and companies need to understand that this growth will not come cheaply and that the perceived fast, easy road to riches will prove difficult to navigate for many market entrants.
"Unlike most of our peers, we believe our meticulous, measured and diligent business strategy will resonate with Medical Marijuana clients and investors," states Harp Sangha Chairman and CEO of Verde Science (OTCQB:VRCI) in an exclusive interview with Financial Press. " The Company is deploying an integrated model that the Company believes will be a game changer initially in North America."
Verde is not reinventing the wheel. The Company has assembled a highly experienced team that will deploy state-of-the-art technology and a superior growing methodology to enter and take meaningful market share for themselves in jurisdictions where they can own a growing facility (Canada): By being a technology provider to assist clients (i.e. dispensary owners) in LA County, which is likely to be followed by other states. Verde is not simply a hands-off technology provider. It will provide the funding to construct the grow facility, design the facility, supervise construction, and assist with selection of varieties of marijuana to grow while maintaining oversight to insure high quality, consistent results. Should any one of these crucial steps be missing, the dispensaries would have at least temporary mishaps or missteps and that could translate into lost revenue and lost customers.
Over the remainder of the year, the company will initiate a commercial rollout of its technology with clients as well as proprietary operations in Canada. With consistent, highly efficient production of clean (no pesticides, no mold, no insect infestation) environmentally friendly (recycled water) product, LA County will soon be introduced to what the Company refers to as the "Tesla" of medical marijuana growing equipment, aeroponics. By moving away from soil or water as a medium, a plant's roots are free to grow larger, stronger and faster. Many plant diseases that flourish in soil do not exist in the absence of a medium for them to grow, virtually eliminating the risk of crop failure. These combined factors result in greater product yield as well as higher and more consistent quality. While aeroponics cultivation has higher upfront costs, the high quality, consistent crop yield significantly makes for a short payback period.
Sangha notes; "Verde will use no pesticides. Our plan is to be a prime mover in this space and to be the first to the market with a pure medical grade product, the cleanest and most environmentally friendly in North America. We are confident that through aeroponics, we can assist our customers to grow the highest quality, highest potency product while routinely doubling traditional yields. Once the upfront costs are recouped we will have substantially higher margins than the competition. In the end the company with the best product and lowest cost wins: Period."
The single biggest mistake that one can make is underestimating the difficulty of operating in this market in a safe, profitable and sustainable way. Transitioning from being a "hobby grower" to an industrial scale cultivator is a costly endeavor requiring million of dollars in upfront capital. While the capital is an important hurdle that many will never overcome, the larger hurdle is where to find the expertise needed to utilize the capital wisely. Verde has this expertise and plans on guarding their secrets.
How hard could it be to start a profitable medical marijuana operation? A new entrepreneur in the space only needs to worry about rent, labor, power, materials and distribution. If that is the sole focus, funding will always be a major concern. A single failed crop could spell financial ruin, or at the very least destroy all previous investments in branding. The business has become more expensive and logistically complex than ever before. Just wait until the FDA gets involved in the approval process.
Many of the changes happening in the industry are and increasingly will be government mandated. Reliable access to funding will ensure staying power. As a publicly listed company with strong financial backers, Verde stands out in this crucial respect. Sangha continues: "Verde Science plans to join forces and work in partnership with established players that have embraced an all-encompassing, integrated technology driven approach to medical marijuana with plans to become the leader in providing services to the cannabis industry. At the current trading price of just $0.08 Verde is trading at a ridiculous discount to its peers in the industry. Many players with far less tangible businesses sport market caps 10 times that of Verde. This imbalance will obviously be rectified by the market sooner rather than later." VerdeScience trades at $0.08 with a market cap of $8.5 million.
Legal Disclaimer/Disclosure: A fee has been paid for the production and distribution of this Report. This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. No information in this article should be construed as individualized investment advice. A licensed financial advisor should be consulted prior to making any investment decision. Financial Press makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. Expressions of opinion are those of the author's only and are subject to change without notice. Financial Press assumes no warranty, liability or guarantee for the current relevance, correctness or completeness of any information provided within this article and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission. Furthermore, we assume no liability for any direct or indirect loss or damage or, in particular, for lost profit, which you may incur as a result of the use and existence of the information, provided within this article.
This just out on stockhouse.com from Chris Parry....only the part about Verde, not the entire article...
June 3, 2014: Also making waves, [at the Cambridge Investment Conference] Verde Science (OTCQB:VRCI, Stock Forum), who sent out high profile consultant and potential one day California Governor Paul Pelosi.
Pelosi, son of 60th Speaker of the US House of Representatives Nancy Pelosi, was doing the rounds talking about Verde’s plan to middleman between the growers and dispensaries, a plan that shows promise the more you realize the cost of weed is likely to plummet in the years ahead, while dispensaries will be needing consistent, quality supply and marketing help to get them out of their current ‘crusty dude in a tie-dyed t-shirt telling you to chill while he counts change’ persona.
You may recall Verde as being Rango Energy until recently.
Said CEO Harp Sangha recently, “Our company was presented with a significant opportunity to participate by teaming up with top biopharmaceutical experts to help produce a meaningful supply of the highest quality product for the underserved markets; particularly Southern California and other jurisdictions as Marijuana is legalized for both medicinal and recreational use."
I haven’t been neck deep in the Verde story, but where they’re positioning themselves is exactly where I’d want to be, especially with the political pull of Senor Pelosi.
Side note: I got the distinct impression Pelosi doesn’t mind sampling the product. Either that or he’s one of the slowest, most considered, maybe even docile conversationalists I’ve met. Not that it seemed to hinder him – he was fine on camera and talked his company up like a trooper, he listened and conversed and held a crowd, but if you slipped a pillow under his head and stroked his ear a few times, I think he’d be happily napping inside ten seconds.
Listen to Paul Pelosi live in about 45 minutes!!
Mr. Pelosi will be a guest today on Business Rockstars (www.businessrockstars.com), a national AM and online radio network with more than 30 million listeners. Mr. Pelosi will discuss Verde Science and his advisory role with the Company.
To listen live, tune in today at 2pm EST / 11am PST to the following:
http://player.warpradio.com/CRN/index.asp?id=13917.
LOS ANGELES, CA--(Marketwired - May 22, 2014) - Verde Science, Inc. (OTCQB: VRCI), a company focused on providing advisory services to established, licensed collectives and growers in the burgeoning medical marijuana industry, and a roll out of a Research and Development opportunity in Canada, is pleased to announce the appointment of Paul Pelosi, Jr. to the Company's advisory board. Mr. Pelosi has 16 years of experience in advising emerging and Fortune 500 companies in the areas of finance, infrastructure, sustainability and public policy. Mr. Pelosi will be a guest today on Business Rockstars (www.businessrockstars.com), a national AM and online radio network with more than 30 million listeners. Mr. Pelosi will discuss Verde Science and his advisory role with the Company. To listen live, tune in today at 2pm EST / 11am PST to the following: http://player.warpradio.com/CRN/index.asp?id=13917.
Mr. Pelosi is a renowned speaker on environmental policies that encourage individuals and local governments to take a more active role in conserving natural resources and reducing carbon footprints. Mr. Pelosi has spoken at conferences in Stockholm, Milan, and Amsterdam and is a contributor to Inside the Minds: Navigating Green Construction and Energy Initiatives, an anthology which provides an overview of the efforts being made to invest in renewable energy and green infrastructure. Mr. Pelosi is a graduate of Georgetown University with a Bachelor of Arts in History (Cum Laude, 1991) and a JD/MBA (Joint Degree 1995) with an emphasis in International Business. He has been a member of the California State Bar since 1996.
Mr. Pelosi commented, "I am please to be joining the Verde Science team. Like Verde Science, I believe that great strides will be made in the next few years in terms of harnessing the true, measurable medicinal benefits of cannabis products. Verde and I both believe that applying traditional biotech strategies in developing specific uses of cannabis will lead to breakthroughs in treating a wide variety of medical problems. In the near future, we believe that through scientific innovation, smoking cannabis products will become obsolete and that its powerful benefits will be delivered in more traditional forms to treat disease and other medical conditions. I look forward to helping guide Verde Science in navigating the ever evolving legal and regulatory landscape as the cannabis market matures in the United States. Verde Science is positioned to be a significant and positive contributor in this industry."
Currently, Mr. Pelosi serves as Senior Vice President of Business Development at InfoUSA where he is responsible for identifying acquisitions and organizing programs to develop effective strategies for reducing waste and promoting greener practices in the market research industry. Mr. Pelosi advises other companies, including NASA Ames Research Center and AirPatrol Corporation, on a variety of infrastructure projects to promote both sustainable development and security.
Mr. Pelosi is a founding member of Cisco Connected Urban Development and, under the direction of Cisco CEO John Chambers, Mr. Pelosi worked with San Francisco, Birmingham, Amsterdam, Hamburg, Lisbon, Madrid and Seoul to attempt to demonstrate how network connectivity might reduce carbon emissions in urban environments.
In 2003, Mr. Pelosi was appointed by San Francisco Mayor Willie Brown to the city's Commission on the Environment, which was responsible for developing policies and programs in recycling, toxics reduction, environmental justice, energy efficiency, commute alternatives, climate change, and the city's urban forest. Mr. Pelosi served as President of the Commission.
Verde Science CEO Harp Sangha added, "Mr. Pelosi has been and will continue to be a valuable member of the Verde Science advisory team. His experience and financial connections will bring value to our efforts and his vision of how this market will develop and evolve over the next several years matches ours, and we look forward to significant contributions from his involvement."
Paul Pelosi, Nancy's son, has been mentioned in connection to Verde Science, but I don't know anything about him speaking on Thursday or if he is expected to mention Verde Science or even talk about medical marijuana related stocks.
LAKEWOOD, Colo., May 12, 2014 (GLOBE NEWSWIRE) -- Pershing Gold Corporation (OTCQB:PGLC) ("Pershing Gold" or the "Company") is pleased to announce the preliminary results of column leach tests on gold-bearing samples from the Relief Canyon Mine property in Pershing County, Nevada. These results show higher gold recoveries than the previous mine operators achieved and also indicate that this mineralized material leaches quickly. A column comprised of a master composite of drill core samples that was designed to simulate the blend of the different mineralized materials to be leached in the future at Relief Canyon yielded 79.2% gold recovery in 71 days of leaching.
The Company achieved higher recoveries from columns built with limestone breccias and clay-matrix breccias, the two rock types that contain most of the gold mineralization in the Main Zone of the Relief Canyon deposit. A column of the limestone breccia yielded 85.7% gold recovery after 70 days of leaching. Two columns of the clay-matrix breccia produced excellent recoveries, with one column achieving a 91.3% gold recovery and the other reaching 78% recovery after a 70-day leaching period.
McClelland Laboratories, Inc. ("McClelland Labs") of Sparks, Nevada, one of the foremost metallurgical testing facilities in the gold mining industry, performed the heap leach cyanidation tests. They tested eight columns of drill core samples that were crushed to 80% passing -3/4" mesh sieve size. This crush size matches the capabilities of the crushing equipment in place at Relief Canyon. The crushed samples were agglomerated with cement and loaded into 8-inch diameter by 20 foot-high columns.
Experts at McClelland and Pershing Gold's technical staff designed the testing program to determine gold and silver recoveries, recovery rates, and reagent requirements as well as to provide information about the leaching characteristics of the various gold-bearing rock types at the Relief Canyon deposit,
"The results from the column leach tests are a real game changer for the Relief Canyon deposit because these recoveries are so much higher than what has been reported for the two operators that mined the deposit in the 1980s," stated Stephen Alfers, CEO and President of Pershing Gold.
As discussed in RPA's 2013 NI 43-101 Technical Report for the Relief Canyon Mine [See Press Release dated January 24, 2013], Lacana Mining Inc. reportedly realized just 45% to 48% gold recovery from its run-of-mine heap leach operation. The next operator, Pegasus Gold Corporation, achieved 65% to 70% recoveries from crushed and agglomerated ores during the 1987–1988 timeframe.
"The high gold recoveries achieved in the McClelland Labs testing program provide evidence that the Relief Canyon gold deposit is highly amenable to heap leach processing. Additionally, the column leach tests yielded another positive result; leaching occurs very quickly – in as little as 71 days, which is great news. Prior to conducting these tests, we did not have much information about leaching rates at Relief Canyon," explained Stephen Alfers.
The master composite column was constructed using composited samples of each gold-bearing rock type in the Relief Canyon deposit in amounts proportional to the distribution of these rock types in the currently defined deposit. The Company believes the 79.2% gold recovery from the master composite column can be used to estimate the average recovery that future heap leaching may achieve. Similarly, the 71-day leaching period for the master composite column can be used to assess probable leaching cycles for future heaps at Relief Canyon.
"The very favorable results from the column leach tests will certainly enhance project economics and are an important step in moving the Relief Canyon Mine forward to production," said Stephen Alfers. "We will be using the results from the finalized tests in future economic analyses."
Leaching is still underway for a column comprised of jasperoid material. The column leach test also included a column dedicated for environmental testing that is still being evaluated and a second composite column that was blended with 10% by weight of materials leached by previous operators. This column yielded 72.7% recovery after 70 days of leaching, indicating that there is minimal recoverable gold in the previously leached materials.
The eighth column tested materials that did not yield high gold recoveries in previous metallurgical tests and confirmed that this material is not amenable to heap leaching. Pershing Gold anticipates that the column leach test results will be finalized this summer and will be announced in a future news release.
Scientific and Technical Data
All scientific and technical information related to the column leach cyanidation tests for the Relief Canyon Mine has been reviewed and approved by Daniel B. Moore, Nevada Registered Professional Engineer and Vice President and General Manager of the Relief Canyon Mine. Mr. Moore is a Qualified Person under the definitions established by Canadian National Instrument 43-101.
Mr. Earl Shortridge (MS, Metallurgy, Colorado School of Mines), the Company's in-house metallurgical expert, helped design and supervise the column leach metallurgical testing program and has reviewed the tests results. McClelland Laboratories, Inc. crushed and composited the samples using drill core samples provided by Pershing Gold geologists, filled the columns, performed the column leach tests, and supervised subsequent handling and analysis of the leached materials.
Press release from May 1, 2014 at 8:00am
LAKEWOOD, Colo., May [1], 2014 (GLOBE NEWSWIRE)—Pershing Gold Corporation (OTCQB:PGLC) (“Pershing Gold” or the “Company”) is pleased to announce the start-up of its 2014 drilling program at the Relief Canyon Mine property in Pershing County, NV. This program will be focused on finding mineable ounces to add to Pershing Gold’s recently expanded 43-101 resource estimate.
The program is designed to step out from known resource blocks as defined by the recent work of Mine Development Associates described in our March 31, 2014 press release. The program will test previously undrilled zones that overlie the current resource blocks, with the objective of expanding those blocks towards the surface to add near-surface ounces north of the existing pit. Additionally, the program will include in-fill drilling that is designed to expand the resource estimate to include additional high-grade zones of gold mineralization.
The drilling program will focus on two areas. The first drilling area will be along the high-wall of the current pit with the goal of expanding the resource to the east. This high-wall drilling will utilize a specialized rig designed to drill holes at very shallow dip angles, allowing Pershing Gold the ability to test areas beneath and east of the high-wall without constructing new roads.
The second area of drilling will include step-out holes testing for high-grade mineralization within and to the north of the existing pit. This drilling will utilize a standard surface diamond core drill rig. The program will also include in-fill drill holes to expand high-grade zones within the Lower and Jasperoid zones.
The Company expects to spend approximately $1.5 million on the 2014 drilling program, targeting 20,000-30,000 feet of core drilling with up to 40 holes. Pershing Gold has selected West-Core Drilling, LLC of Elko Nevada for the surface diamond core drilling and expects to award a contract for the specialized drilling in the near future.
"The 2014 drilling program is a key step for Pershing Gold as we execute our 2014 mine development and resource expansion programs,” stated Stephen Alfers. “It is one prong of our two-prong approach to continue to expand the Relief Canyon deposit while simultaneously completing the mine planning, metallurgy, engineering, geotechnical, environmental and permitting work necessary to advance our plans to reopen the Relief Canyon Mine in the second half of 2015.”
About Pershing Gold Corporation
Pershing Gold is an emerging Nevada gold producer on a fast-track to re-open the Relief Canyon Mine, which includes three open-pit mines and a state-of-the-art, fully permitted and constructed heap leach processing facility. Pershing Gold's landholdings cover over 25,000 acres that include the Relief Canyon Mine asset and lands surrounding the mine in all directions. This land package provides Pershing Gold with the opportunity to expand the Relief Canyon Mine deposit and to explore and make new discoveries on nearby lands.
Having, "inherited" a medical marijuana play in the form of Rango Energy (soon to be called Verde Science), I've spent the past several weeks studying the industry in Canada and the U.S. Yes, there's lots of hype and yes, many, many of the companies trying to ride this wave will be wiped out.
At first blush, Rango's sudden move into the "hot" sector looks like a gimmick or an act of desperation. To be sure, it's still early in the game and difficult to know if Rango/Verde will succeed. However, I'm confident of two things....1) the bar is not set very high among so-called medical marijuana peers and 2) there's truly positive momentum in the acceptance of medical marijuana in North America. In the U.S., the sale and consumption of medical marijuana is allowed in 21 states. In addition, two states allow both medical and recreational marijuana-- Colorado & Washington. Acceptance has come a long way in the past 12-24 months.
Peer Valuations- Bar NOT set very high...
Canadian company, Tweed Marijuana Inc. [TWD.v] & [TWMJF] has a US$ 120 million market cap and zero sales. The company's first order of medical marijuana will be shipped this week. The company has the legal authority to grow and sell 15,000 kg per year. That's 33k pounds. Investors appear to be treating the company as if reaching sales of 33k pounds per year is a foregone conclusion.
Creative Edge Nutrition [FITX] has about $4 million of trailing annual revenue as a nutritional supplement player. It's moving into the Canadian medical marijuana space where it will do almost exactly what Tweed is preparing to do. Tweed has a license and an actual crop in progress. Creative Edge does not have a license, but expects one within weeks. After that, It takes about 12 weeks to grow a crop. FITX has a market cap of US$ 294 million.
I'm not merely cherry picking emerging companies with the largest market caps to make Rango look cheap... Tweed and FITX are proposing to do in Canada what Rango is looking into doing in California, namely growing medical marijuana. To recap, Tweed no sales, US $120 million mcap, FITX $4 million sales and a $294 million mcap. Rango Energy, no sales and a $9 million mcap.
Tweed's stock (combined U.S & Canadian tickers) traded in excess of US$ 10 million today alone. That's over 3 million shares at a price above $3/share. Rango's trading volume today? About US$ 30k.
Am I saying that Tweed and FITX are buys at current levels? Not sure, I don't know enough about them or the Canadian medical marijuana market. But, IF I WANTED to play the medical marijuana sector I would much rather own a $9 million market cap company that hasn't already spiked, then a Tweed or a FITX.
I'm hoping to see further news from the Rango/Verde Science in coming weeks. If I don't see some tangible, actionable developments this Spring, all bets are off.
Thanks jxcxjx
So, FITX has twice the market cap of Tweed.
Why should I buy FITX and not Tweed?
How many outstanding shares are there of FITX? Can anyone give me a definitive answer on that question? That's the main problem with this stock, the # of shares.