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All of the sudden CVSi stock is worth $4.75??? What a BIG surprise.
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Q&A on New USDA Hemp Rules
http://app.mjbdonline.com/e/es?s=1257941912&e=553233&elqTrackId=B1F0B909CCF90C71B9C490C37BFE6647&elq=6bc9197079c84900953f0989582230d2&elqaid=2440&elqat=1
Canopy Growth up 6% as BofA buys the dip
CVSI/MJ/CBD industry related.
Nov. 20, 2019 8:40 AM ET|About: Canopy Growth Corporation (CGC)|By: Stephen Alpher, SA News Editor
With the stock off some 70% over the past few months, the valuation is at a minimum more "reasonable," says BofA analyst Christopher Carey, upgrading Canopy Growth (NYSE:CGC) to Buy.
Consensus estimates look "achievable (even beatable)" for the first time ever, he adds.
Shares are up 6% premarket.
House panel passes bill to decriminalize pot
Nov. 20, 2019 1:05 PM ET|About: Canopy Growth Corporation (CGC)|By: Douglas W. House, SA News Editor
The House Judiciary Committee, controlled by Democrats, has voted 24-10 in favor of a bill to decriminalize marijuana on the federal level. Several Republicans on the committee backed the bill as well, dubbed the Marijuana Opportunity Reinvestment and Expungement (MORE) Act.
The legislation, if enacted, will also expunge prior marijuana convictions, encourage resentencing hearings for people still under supervision and establish a 5% sales tax on marijuana products aimed at funding grant programs to provide job training, legal aid and other services to people ensnared in the War on Drugs.
The MORE Act has more than 50 co-sponsors in the House.
The going will undoubtedly be slower in the GOP-controlled Senate. Democratic Senators Kamala Harris (CA), Cory Booker (NJ) and Elizabeth Warren (MA) are supporters.
There are too many new participants for this to be a P/D. A full BOD for business development. A new CTO and Revenue Officer.
If this is a scam then it is a very well planned one,
The Qdots exist and the blockchain ledger should not be a problem.
We will find out in couple of months.
They said they tested it with the fortune500 oil company. That the counterfeit lube oil business is a big problem in Asia.
It was tested and they liked what they saw. Maybe I am wrong but that's what I heard.
Footwear 22% of all counterfeited products. Apparel is also a big opportunity.
It seems to me that they are closer than what I thought.
Now, I would like to see the expected positive (or any) cash flow and soon.
I don't post about CW when compare to CVSI to attack the company, but I was forced to compare both companies when investors that hold both companies or just only the competition came to this board to bash my investment. There is no better reference either. I watch numbers and trends to make sure the business models stand a chance going forward. Financial discipline is paramount of me because I tend to invest heavily.
These are numbers mostly found in official public documents. Check the Q3 10-Qs for the 9 months numbers.
If CWEB had reported $30M+ as expected, then CVSI could have reported $19M to $21M for the Q3. I wish this was the case but it was not. The industry is being affected by opportunist taking advance of the lack of regulations by the FDA.
What I am trying to show with my posts and it's JMHO is:
1. Both companies are struggling, both have issues to correct, and the sales numbers don't tell the whole story.
2. Both have totally different business models and strategies.
3. The competition have NOT started YET.
4. I don't mind the competition. I care more about the business model for the longer run.
5. Both line of products are different. We know one works because of it's origin and backstory. And I am sure PlusCBD works because I sell it myself (To promote and test the products) and I know and can say that PlusCBD works a 100%, specially for stress, better sleep and arthritis. A 100% satisfaction by people who use it.
We needed a post like this. Thanks.
All these concerns are very real. There is nothing guaranteed for any company. The FDA has damaged the industry for now. The good thing is that it's still early to absorb this damages and learn about them.
It's a young industry and the opportunity is huge.
The FDA will not only issue regs but will also endorse the extracts. And that's the problem for them. They scared many people away. We have people in management that come from successful natural products companies and new hires for marketing, e-commerce, salesforce implementation and BOD members. We have smart people in charge.
But there are also people in need of the best quality products. CBD is NOT a pastime or recreational product. I sincerely believe that people in need will find their way to the best products maybe from 20 or 30 companies and NOT 120plus.
So, I am with you with all your concerns. And thanks for posting them.
LONG CVSI.
Any company can have a slow quarter or several of them. The important thing is to understand why. And in the case of CVSI (and others CBD), the reason is very evident.
Comparing two different companies with 2 VERY DIFFERENT business models. Let's see what happens next year. (Think MJ growers in Canada)
-------------------------------------------------
CWEB Q3 sales $25.0M Operating Loss $1.72M
With 9,000+ stores and 51% E-Commerece sales
CVSI Q3 sales $12.6M Operating Loss $1.77M
With 5,400 stores and 20% E-Commerce sales
With $25M sales, CVSI will be making $3 to $5M in Operating Income because of it's business model.
---------------------------------------------
CWEB GM is 71.3% and 9 month average is 77.1%. DOWN 6 points on a FLAT sales Q.
CVSI GM is 66.9% and 9Mo average is 72.2%. Down 5 points on a 25% sales drop.
----------------------------------------------
Expenses:
CWEB $19.3M +21% QoQ on a FLAT Q
CVSI $10.2M or -4.7%QoQ on a 25% sales drop Q.
----------------------------------------------
R&D spent during the 9 months period:
CWEB $1.1M or 1.5% of total sales
CVSI $4.6M or 10.3% of total sales
----------------------------------------------
Cash from operations:
CWEB: Negative $24.8M from $71.8M in sales.(9,000 plus stores)
CVSI: Positive $2.4M from $44.4M in sales. (5,400 stores)
-----------------------------------------------
CWEB sales guidance cut: 45% at the mid point And late because they knew.
CWEB cash available will be around $7 to $10M in 2 quarters at this pace, probably the same as CVSI, with an operation that costs twice as much.
Current Valuation:
CWEB @ $100M sales for 2019: P/S of 10+
CVSI @ $56 M sales for 2019: P/S of 2.2
-----------------------------------------------
Regulatory compliance and scientific work done:
CVSI is the clear leader by far. Remember the R&D spent???
Who sits on the the table with the FDA to talk about the upcoming interim regulations???
CWEB: No where to be found.
------------------------------------------------------------------
The more I read the financials the more I like CVSI.
I just follow the numbers, they don't lie.
CVSI is selling $56M this year. Sold $48M last year , $20.7M 2 years ago and $11.1M 3 years ago.
3X sales from 2 years ago and 5.5X from 3 years ago. All these with only 2,000 stores
Store trippled this year and waiting for FDA to move in in full force.
The slow down is understandable given the regulatory hurdle.
It's NOT the same $1.2 BILLION spread in 150 companies than $10 Billion spread among 20 to 30 companies with 95% of that concentrated in only 5 to 7 companies.
CWEB WILL NOT OWN THE WHOLE MARKET. NEVER. Weed is weed. MJ will be legal next year or next. Growers will compete against each other. The price is collapsing in Canada as an example, and fast. Hemp crops are not selling in the US. But the costs remain.
CVSI will be out of this fight and buying the best products at the best prices and turning that into High Margin products to sell all over. 4 foreign markets established as far as I know. Japan, NZ, Australia and now the UK.
E-Commerce more than doubling in a year.
CVSI is sitting at the table with the FDA. Where is precious CWEB management when we need them? The only company facing the hurdle properly. Is CWEB aligned with the USDA? Will it be with the upcoming FDA regs?
Who knows. But I know CVSI WILL pass with flying colors before the rest, including cweb.
CVSI managed a $5M/Q inventory in average last year for a $48M in sales. There is a $10M inventory waiting for the FDA right now. The new facility is ready, so yes, CVSI is VERY READY. They are no stupid. CVSI started this business.
And the Pharma side might, just might, kick in next year. So there is plenty of possibilities. Don't be tslking dooms day about CVSI. You got in late, well tough shit. The whole industry is upside down. Can it grt back on track? Definitely YES.
So stop the pessimistic BS.
NO DEBT like CWEB hemorraging CASH like there is NO tomorrow.
Just got a market open in the UK with 67 Million people. The size of California
CVSI reported good numbers on August 6 and the SP dropped from $4.09 to $3.08 in one week. That's minus 25% drop on a good report.
Then the patent failed news. Non-Material took the price down another dollar to $2.10. That's 2 full dollars on nothing material. 50% drop on nothing. I would say that the recent miss was priced in already.
Now CVSI is down 39% from $2.10 pre-Q3 report. I see this as a discount.
Sales ttm is $58.6M and @ $1.28 the price to sale ratio is 2.17
The closest competition is trading at P/S 10+ or five (5) times CVSI.
What do you think will happen if the SP goes to 50 cents????
CVSI is selling close to $60M in products without debt and manageable cash flow.
CVSI sold $48M in 2018 with 2,400 stores with full portfolio. Now we have over 6,000 stores with some just waiting for guidance from the FDA, which could be coming out anytime before the end of the month.
The FDA guidance will clear the market of smaller non-compliant companies.
FOCUS
What happens if the FDA does what they are supposed to, and we get to 12-20K FDM stores with full portafolio capabilities in the next couple of quarters???
The USDA regs are out, the FDA must follow.
What happens to the stock price if we get to the Nasdaq too???
How many companies have the doors open to the FDM.???? 80,000 stores as per cweb CEO DE.
Long CVSI.
Tough times is nothing for the disciplined and determined like me and CVSI. Success is built in tough times.
The trusted brand name, PLUS CBD OIL™, has finally arrived in the UK from the States.
https://cbdoilstore.uk/product-category/our-manufacturers/plus-cbd-usa
CV Sciences Inc (OTCMKTS:CVSI) Receives $7.00 Average Price Target from Analysts
https://trentdailytimes.com/2019/11/17/cv-sciences-inc-otcmktscvsi-receives-7-00-average-price-target-from-analysts-updated.html
CV Sciences Inc (OTCMKTS:CVSI) has earned a consensus recommendation of “Buy” from the six research firms that are covering the stock, MarketBeat Ratings reports. One investment analyst has rated the stock with a hold recommendation and five have given a buy recommendation to the company. The average 12-month price objective among analysts that have covered the stock in the last year is $7.00.
Until the FDA issues guidance for the market, it's all speculation.
CEO Deanie Elsner has been speculating since she took control of the company and she had to make adjustments to the sales guidance.
That's exactly my point. We haven't started yet. We can only speculate until we get some clarity on the regulations. And then the speculation will be greatly reduced.
Investors will speculate when the market open tomorrow and buy CWEB @ $10.31 US thinking it will go up, others will sell.
So my speculation is not important. But the Chinese are getting in the action and product is being imported from Colombia. Tilray, Canopy and now Aurora is getting very serious abut jumping in too.
--------------------------------------------------
Risks:
Fair enough and thanks for your answer.
Listen to yourself.. You really lost me with this one. It will be good for me if there is a delay!!!
The comments from the lady in charge a few weeks back and another guy from the FDA a week ago saying that an update on the plans is coming soon.
"An update on the plan". And NOT the interim rules. A very bad feeling. All speculation of course but I would not be surprised at all if they kick the can down the road some more.
I agree, the man is a flipper. When the FDA (Or ex-FDA) talks about CBD, they refer to the ISOLATE form, but they are conveniently using this to scare the general public about all the other hemp formats.
But it's Shane from the MF that's writting his typical BS stories. Another flipper.
You are very right about this statement. Spot on. Watch you CASH because good business is about making money no matter the strategy or business model as long as it's legal.
How much do you think that the FDA interim regs (If ANY) is going to affect this company??
Seriously....0?....25%?....50%? How much??? I would like to know the consensus here about the effect the FDA new interim regulations will have on this company.
I am going to be totally honest with YOU here. I don't think there is going to be any Regulations for a while. The FDA has hinted that a couple of times in the past month. So we are all stuck here for the long run or else, move your money now.
JMHO
Efficiency will be paramount. It has always been important, but now it's more so. The higher valuations the more dangerous too. I know what I am talking about here.
Nothing is COMICAL about the CBD industry right now.
Fair enough. I do get your point of investing to make money, but I am going further than that. I want the money invested to be efficient. The competition has a totally different business model and I understand that most investors want tangible assets to feel the value of the company.
But:
1. When you deploy money you better have a good idea (vision) that such investment will not become just a liability down the road. Look what's happening to the BIG MJ because of their uncontrolled spending.
2. CWEB's inventory growth is out of control. The products are not moving as expected. This could only be temporarily but it gives you and idea of what I am talking about. A bottleneck brings inefficiencies. Yet, cultivation expansion is in full force.
3. No one knows what the FDA is thinking or planning but it could cause some problems. Again, maybe only temporarily but still possible. Of the 2 companies, your CEO seems to be the most lost the it comes to the path the FDA will take. CWEB can't sit on the table. She has never said anything about working with the FDA in cooperation for the upcoming interim rules. Nothing.
4. CEO DE failed to provide proper guidance twice. Last Q she knew of the problem and did nothing to correct it. And now she is making the same mistake, providing 1 year ahead guidance without even taking to the FDA. That's called unrealistically PUMP in my book. Now we all know that they have the sales velocity figures, so they are better prepare to give some kind of guidance (short term). But I expected a lot more from her given her background. With NO regulations in place there should be NO longer term guidance, PERIOD.
5. CWEB's PR lacks the aggressiveness that only confidence can provide when the new distribution deals are signed.
6. There will be some financial adjustments required for CWEB to normalize the spend, inventory, cash flow and others and it will be possible if the regulations come soon and are 75-85% favorable.
7. No one can deny the efficiency of CVSI business model. Compare the operating losses for this quarter and the operating income for the last one. No attachments to the expensive cultivation process. Totally flexible for changing market conditions. Operates in the HIGH VALUE end of the industry. Where the money is made. Healthy R&D spend to move the scientific work and products forward. A must in this industry.
CWEB is a good and promising company but there are issues that need to be recognized and fixed.
Again, for those with a longer view, the game has not even begun. CVSI will move swiftly once the regs are in place. In time the current difference (2 to 1) in store count will not matter because both companies have the capabilities to grow in tandem. In the regulations front, CVSI is better prepared. If the pharma side by any chance has any success next year, then the valuation will go up. CBD works, we all know that.
So don't count CVSI out just yet. A different story will unfold next year when ANY kind of regulation is provided by the FDA. CVSI can wait because the company is asset light and efficient. Just flexible.
China is also joining the Hemp party and products are being imported from Colombia. So the raw material will abound. The distilling process will be key to have some advantage but growers will have to be careful.
Expensive infrastructure (Warehouse for Inventory) could become problem.
To me, contracting farmers in different States and teaching them exactly what you want without the hassle of the cultivation process is just brilliant.
Once up and running, this system will work for years and will grow efficiently. The farmers won't have to worry about prices fluctuation and the company will have it's yearly supply secured.
That way you can concentrate on developing great products and developing strategies to win market share.
Charlotte's Web: Don't Buy The Dip Just Yet
https://seekingalpha.com/article/4307153-charlottes-web-buy-dip-just-yet
Nov. 15, 2019 3:58 PM ET|18 comments | About: Charlotte's Web Holdings, Inc. (CWBHF)
Stone Fox Capital
Stone Fox Capital
Long/short equity, growth at reasonable price, research analyst, Deep Value
Stone Fox Capital
(22,936 followers)
Summary
Charlotte's Web missed Q3 estimates and cut 2019/2020 targets.
The CBD market faces regulatory issues from a lack of clarity by the U.S. FDA.
The company hasn't altered long term targets, but the initial 2020 revenue target of only up to $150 million places a $6 to $8 price target as plausible.
Charlotte's Web Holdings (OTCQX:CWBHF) crashed the market with signs the U.S. cannabis market is facing some of the competitive pressures that has already hit the Canadian LPs. The updated views of the company doesn't alter the long-term positive view on the CBD sector, but investors shouldn't rush into buy the dips in the stock at the current valuation.
CWEB SH GET READY for the reality of the current market. A 10X price to sale valuation won't cut it.
CWEB Q3 sales $25.0M Operating Loss $1.72M
With 9,000+ stores and 51% E-Commerece sales
CVSI Q3 sales $12.6M Operating Loss $1.77M
With 5,400 stores and 20% E-Commerce sales
---------------------------------------------
CWEB GM is 71.3% and 9 month average is 77.1%. DOWN 6 points on a FLAT sales Q.
CVSI GM is 66.9% and 9Mo average is 72.2%. Down 5 points on a 25% sales drop.
----------------------------------------------
Expenses:
CWEB $19.3M +21% QoQ on a FLAT Q
CVSI $10.2M or -4.7%QoQ on a 25% sales drop Q.
----------------------------------------------
R&D spent during the 9 months period:
CWEB $1.1M or 1.5% of total sales
CVSI $4.6M or 10.3% of total sales
----------------------------------------------
CWEB sales guidance cut: 45% at the mid point And late because they knew.
CWEB cash available will be around $7 to $10M in 2 quarters at this pace, probably the same as CVSI, with an operation that costs twice as much.
Current Valuation:
CWEB @ $100M sales for 2019: P/S of 10X
CVSI @ $56M sales for 2019: P/S of 2.4X
-----------------------------------------------
Regulatory compliance and scientific work done:
CVSI is the clear leader by far. Remember the R&D spent???
Who sits on the the table with the FDA To talk about the upcoming interim regulations???
------------------------------------------------------------------
The more I read the financials the more I like your competition.
I also bought more this morning. Have a good WE. All CVSI needs is a leveled playing field. That's all.
Long CVSI
CVSI Charlotte's Web: Don't Buy The Dip Just Yet
https://seekingalpha.com/article/4307153-charlottes-web-buy-dip-just-yet?dr=1
Just comparing both companies valuation; CVSI & CWEB.
You know, yo are right. GRAS is worth SHIT right now, but CVSI is on the table with the FDA negotiating the new guidance as we write in this board. So until CVSI gets it's "No Question Letter" from the FDA, you are right.
Where is your company?? On the table with the FDA??? Or will it be in the plate when the guidance comes out???
You are very lost. Self-affirmed GRAS status puts you on the table and NOT in the plate. That's a ticket for a sit down with the FDA and any FDM retail company. That's the language of the BIG retail chains and specially the Pharma side. You can go back to your board now. Get with the program.
Long CVSI
46% gross margin in tough times is dangerous. It's a young company. It still has a lot to proof. I understand the company has an MJ/hemp strain. I would wait for the regulations to get implemented. Cannabis type III is industrial hemp (Ditch weed). The gross margin didn't improve to acceptable levels despite the huge increase in sales, but small compare to bigger players. Over glut of hemp crops make other small companies a strong competition. The whole industry is upside down right now.
Too dangerous. Look what's happening to the bigger companies and the big MJ companies are changing their strategy amid stagnation.
How is the cash flow???
How did they achieve that growth in sales?? The gross margin tells the story.
CVSI CEO JD @ the CC
Aurora Cannabis follows Canopy with big Q3 dropoff
Nov. 14, 2019 7:27 PM ET|About: Aurora Cannabis Inc. (ACB)|By: Carl Surran, SA News Editor
Aurora Cannabis (NYSE:ACB) -12.7% after-hours as Q3 results show a 24% Q/Q drop in revenues to C$75.3M (US$56.8M) from C$98.9M, and the company said it would slow its expansion plans in Canada and abroad.
ACB's Q3 adjusted EBITDA loss was $39.7M, wider than the expected $20.8M loss.
ACB said recreational cannabis orders from the provinces "slowed considerably" in the summer, citing the "slow pace" of getting pot shops licensed and running.
The company plans to immediately stop construction at its Aurora Nordic 2 weed-growing facility in Denmark, saving ~C$80M over the next 12 months, and delay the final construction and activation of its Aurora Sun facility in Canada.
ACB also said it reached an agreement with investors holding $155M of its March 2020 convertible debentures to convert early at a lower price.
Shares closed -7.3% in regular trade after Canopy Growth (NYSE:CGC) reported a 15% Q/Q drop in net revenue; CGC -2.1% after-hours following a 14.4% decline in regular trade.
Good for you and good luck. Just easy with the insults.