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I don't see any movement on MJ at the fed level until at least a month or two after inauguration. The question will be, would passage (safe banking, rescheduling) be one of those "In the first 100 days" items for either president/king/queen that gets elected for the next four years. It could be an easy win to chalk up and prove some competency, progress, action in either administration. But perhaps sniping will rule the day next year rather than doing anything meaningful in congress. I see another impeachment attempt of Biden is afoot for when congress comes back from summer recess - more time and dollars well spent by congress rather than doing their job.
If SHWZ can consistently show net profits between now and then, yes, a bump is possible. And with the stock in the gutter, getting back to sixty cents would be a big percentage bump for traders.
Right Doc, languishes probably through the end of the year, easily. They best hope they don't find any irregularities missed prior as well. But even if it all gets resolved next year, no surprises, and SHWZ says, "Hey everybody, we're back!" they may be saying that to an even emptier room than the one they are in now. They couldn't get people to care about the stock before, now, that's a steep hill they will need to climb to even get penny traders to take interest again. Beyond someone buying them for peanuts, I don't see a compelling upside for quite some time.
He's dreaming. $2.50? The stock hasn't seen 2.50 since 2021.
Nice to see the revenue uptick but unless they get a better handle on debt and expenses, I don't share his optimism. Nice to hear outreach to the investor community may be in the picture, but why did it take this crisis to get to that point? This company's differential initially was the "stellar" management team, there no longer is that confidence in the management team, and Dye stepping back in demonstrates he shares the same concern. They have a lot of proving to do over the next 6 months to warrant anything but flipping by traders if/when they return to trading. Not seeing this ER having any real effect on the stock or people's perceptions of the company to create a shift in sentiment.
I admire your optimism, but .75 is over double where this trading even before all this audit news broke. I think they'd need some really stellar news to go back over 30 or 35. Especially after this recent headwind.
Doc,
Any experience with what happens when a stock like this comes back out of the expert market? Let's assume SHWZ gets their house in order and gets moved out of purgatory. The only folks who can be set for that move are the experts. Bagholders just sit and wait for a move to get close to where they were in the past. I'm assuming we can't place a buy order at a low price ahead of its return to trading. So any flip trades for that first day have to be both nimble and lucky?
They've done such a great job of alienating investors, even a good ER will struggle to overcome that. There are other stocks, better managed companies, who didn't step in it and get moved to the Expert Market. So I would not expect anyone rushing back into this when it resumes trading, except flippers betting on a potential move when trading resumes and cashing out as soon as it does. IMHO, this rises only when someone makes an offer to buy it above where it's trading price. It's now a stock waiting on a hero, they've ruined any and all good will with investors.
The irony is, no one has to turn the lights out here on this one, SHWZ did that for the shareholders as a parting gift I suppose.
Gnomes' reasoning doesn't account for the fact SHWZ was in the tank and going nowhere prior to the recent mess. And if you add to my previous list lack of any real awareness of this company to help it participate in any future rally, the prospects are even more bearish. Despite the protestations about always being on point to provide shareholder value, the results have been nothing short of the complete opposite. That is not a momentary bump to use Gnomes' terminology.
How can anyone not be bearish? Looking at the trend in share price over time, the shrinking sales in CO and NM, the ongoing lack of action at the federal level on scheduling, recent pronouncements safe banking isn't on the near horizon, the additional shares being given to management as rewards for sinking the stock and eroding shareholder value, and these recent management missteps with the audits, I'd be interested in what the argument is for being bullish that isn't bull of a different variety.
I wonder when the lawsuits start. That has to be days away at this point.
just get on the board where they hand you shares left and right, no competence required apparently.
This was in today's announcement - though if SHWZ parted ways with this group prior is it because SHWZ noticed something awry, or is it that the reputation of Bolgers as an auditor was shot? Who knows. But this was noted at the end of the press release:
As a result of the delayed filing, Schwazze has sought from, and is in communication with, the Ontario Securities Commission (“OSC”) concerning the availability of a management cease trade order (“MCTO”) in respect of the missed deadline for the Quarterly Report ended March 31, 2024. If an MCTO is granted, it is expected that the general investing public will continue to be able to trade in the Company's listed common shares, however, the Company's Named Executive Officers will not be able to trade in the Company's common shares. The Company confirms it will comply with the provisions of the alternative information guidelines under National Policy 12-203 – Management Cease Trade Orders for so long as an MCTO remains in effect.
So the concerning piece is this:
the SEC issued an order to BF Borgers and its owner citing the deliberate and systemic failures to comply with public company accounting oversight board("PCAOB") standards in its audits and reviews, which were incorporated in more than 1,500 SEC filings from January 2021 through June 2023 and affected at least 75 percent of BF Borgers' 369 clients.
So the audits done prior in 2023 are probably not valid, which raises further doubt about the company's numbers. As well as judgement in leveraging an auditor with this level of problems.
Turning into a clown car. Rookie mistakes, not quality leadership. Thoroughly disgusted.
Thanks - this is pivotal, wish there was more color on this at this stage.
"Scoffed at the notion of any default, technical nor otherwise. His investment too great.They are exploring how to best deal with notes coming due next year and exploring available options whether taken out of hide or by extension."
Not surprising that he has as low a view of safe baking being passed as I do.
Overview of CO cannabis market's ugly picture. A few interesting things, SHWZ is nowhere in the article. Did they just decline or are they so off the radar even in CO no journalists bother to knock on the door? Also suggests the regional strategy of SHWZ is hurting them when focused on states that are struggling. Maybe time to reconsider the regional push perhaps?
https://finance.yahoo.com/news/colorado-booming-weed-market-went-110000414.html
"Waiting on the Govt like all of us." I was thinking we might have to turn the lights out here... I suppose MJ legislation is not as high a priority as non-legislative posturing like trying to embarrass Fauci and failing miserably all these years later, or questioning college presidents about campus protests, or maybe another Hunter Biden hearing, or Mayorkas impeachment, or Twitter, Til Tok and China, or maybe another Benghazi hearing since who doesn't want to hear Hilary again, or cogent discussions about what constitutes a bleached blonde, bad built, beach body or not. We will be waiting a long time for the congressional clown car to go in any direction besides every direction and nowhere at once...
He makes a compelling argument. Besides culling management to reduce executive pay, or some surprise early rescheduling where the tax advantages would help the bottomline, this is the path SHWZ is on and others in this space. Since neither of those two previously mentioned scenarios will occur, that leaves restructuring their debt (under what would be less favorable terms than what could have occurred a few years ago), or someone buying them at cut rate prices to save them from default. Or selling more and more shares to raise cash at diminishing returns as they dilute. Or default. Out of all those possibilities, only a buyout would do anything to help shareholders, but of course, not as much as we'd hoped in the past. Am I missing any other options?
To play the pop on the actual passing, yes. I agree. But it's a guess how long that bet will be tied up, and if drags on for a few months, the pop will be from below 50 at that point. Either way, as soon as it pops, sell, since the stock will immediately drift back down again imo.
It's just another announcement in a long line of announcements that haven't yet borne fruit. Any investor in the MJ space would be a fool to think it's a done deal, or that it will happen over the short term based on past history. Public comment will occur, more than likely the hand will be forced for a public hearing on this, the usual gaggle of idiotic geese will come out and push against this rescheduling. Dithering and deferring will occur. Political posturing for constituents around protecting them from the evils of drug culture will occur during an election year for those politicians who view that as a winning position in conservative states. I fully expect delays, a slog drawn out on this. Pot investors are now all from Missouri, show me it's actually done and we'll make a decision to buy then. And with the recent ER and SHWZ's near invisibility in the MJ space, even when/if rescheduling occurs, we'll lag the other companies in any pop that occurs. Nothing I heard on the earnings call addressed that point for shareholders, in fact, they stated the opposite, they are investing to do a slower fuller buildout of the company and its approach to serving customers in a manner that will over the short term limit earnings, margins, and forestall any meaningful stock appreciation. That's what I read between the lines. They are fully a long term investment now was the message, not short term.
At this stage I'd be happy if someone bought them for $2 and each quarter that seems more and more like a pipe dream... Read the transcript of the call. More investment to build out a better customer experience, potentially good for the longterm but a short term hit to profitability while that occurs. Quoting numbers like 600+ cannabis stores in CO gets little pity from me, since the guy quoting that comes from a supermarket background and there are over 500 supermarkets in CO. So isn't that level of competition the playing field and one he's familiar with? Lower margin, higher operating costs, ramp up of stores seems slowing, and the need to sunset stores throws shade on their playbook and ability to ID and improve already well-performing stores. Wholesale, medical showing some promise. Clearly stated they are focusing on building the business and that will not lead to share growth in the short term.
I would like the earnings call to directly address what the company will do for shareholder value. Increasing the share count will not do that. Executive compensation has not achieved that. Excuses related to challenges in CO and NM do not do that. Twiddling thumbs while waiting, hoping, wishing rescheduling will occur soon won't do that. What is the plan to maximize and appreciate shareholder value in line with other companies in this space over recent months, all suffering similar challenges? SHWZ needs to provide a compelling reason for shareholders to stay and new ones to purchase the stock. And honestly, I'm at a loss as to what that could be except them saying "we think we hit the bottom." Not exactly a compelling argument. And SHWZ who? It would be nice if they made half an attempt at letting the world know they exist.
This is what I expected to start hearing based on my post yesterday, but just not this quickly... But if companies can reduce taxes, they would free up money for acquisitions. Nice to see at least one thinking along those lines to confirm that thinking. Whether SHWZ will get swept up in this next wave of big fish eating little fish we will need to wait and see. https://www.fidelity.com/news/article/investment-news/202405020703RTRSNEWSCOMBINED_TUA1NHYNT_1
In the long list of "came and went" runs in the MJ space, this may be the camiest and wentiest of all of them. I suppose now we wait to see if congress will only dangle the carrot of safe banking past the November elections, and then fall back on their usual inaction more resolutely. My one speculative hope in the interim is that if the schedule 3 move becomes more assured as to when (hopefully also not past November), the bigger fish, once getting their taxes in order, may get ripe for takeovers and buyouts of the smaller fish again. Of which I hope SHWZ ends up being one.
Yep, SHWZ gets tax advantages with this change (IRS related write downs, no small thing), but we still need to recover the onside kick of Safe banking and then score with recreational legalization at the federal level. But all that is struggling against a reactionary wave in many states (states gaining more power in the current Fed vs State historical struggle in the US), in places like Florida where Desantis is speaking out against MJ rec use, and others. Shwz moved a whopping 11 cents yesterday on volume over 6 times its daily average, trailing greatly other MJ stocks in terms of yesterday's bump. So we remain a lagger, struggling even to get back to a dollar after this news. So giddy excitement is not really warranted. And I agree with StevenRisk that management should have addressed the settlement the other day, as well as the DEA move, even if it was just a simple, boilerplate statement of what the rescheduling means to them in clear operational benefits. But management seems almost afraid to let anyone know they even exist.
In older days, I would be thinking, man, safe banking is a slam dunk after the DEA announcement. But nothing is a slam dunk for that dysfunctional band of fools in congress. So I remain merely cautiously optimistic they will get their heads out of their behinds during an election year and finally pass something.
Well, I was just wondering if this sector was totally dead at this point and then lo and behold a hail mary pass and MJ is back in the ballgame.
One onside kick from here and super bowl bound
I agree that the CEO search is a formality, they have their man, and this was probably that last test before making the formal announcement. They really can't do more than smaller targeted expansions, a dispensary here and there (and I'm not sure one per quarter is likely). They have optimism, if muted, about the fed making a move in the next two months, I wish I could share in that enthusiasm but I can't. I think the best hope is a small bone thrown to the electorate a little closer to November, and that's assuming a congress currently imploding under its own imbecility will be able to muster a bill to move forward. But with the way this sector is, even a small bone is something. I doubt we see the 1.30s again for quite some time. And even over a 2 month timeframe, I don't see a reason why we won't see low volume and drifting back down into the 50s. People won't be rushing in to buy a stock whose best reason to crow is holding their own in a competitive market, making less but not doing as bad as others.
Damacon did a great summary. Ugly ER, only saved by the fact that yes, it could have even been uglier. Certainly the ER was a poster child for why executive compensation does not generally lead to stellar stock performance, at least not in proportion to the compensation. Without a fed Hail Mary in the next few months, SHWZ and most MJ plays will be struggling. Perhaps that is what the big fish want, swoop in and buy these companies up for pennies on the dollar just before the feds make their move, benefit from all the previous licensing agreements, branding at bargain rates. Hard not to believe the game is crooked at this stage in terms of MJ legalization, rescheduling, safe banking delays.
no vote of confidence shown in the trading today for tomorrow's earnings call.
one of the Canadian pot companies turned in a respectable "turn around" story ER the other day. A sign of what good management can accomplish. Hope to hear a similar story on the 27th here.
The number of posts here is in strict alignment to the volume of shares traded on any given day... Seven more days before earnings and any potential meaningful news.
In case no one saw this - earnings call.
DENVER, March 12, 2024 /PRNewswire/ -- Medicine Man Technologies, Inc. (SHWZ), operating as Schwazze, ("Schwazze" or the "Company"), will host a conference call on Wednesday, March 27, 2024 at 5:00 p.m. Eastern time to discuss its financial and operational results for the fourth quarter and full year ended December 31, 2023. The Company's results will be reported in a press release prior to the call.
The Schwazze management team will host the conference call, followed by a question-and-answer period. Interested parties may submit questions to the Company prior to the call by emailing ir@schwazze.com.
Date: Wednesday, March 27, 2024
Time: 5:00 p.m. Eastern time
Toll-free dial-in: (888) 664-6383
International dial-in: (416) 764-8650
Conference ID: 38840334
Webcast: SHWZ Q4 & FY 2023 Earnings Call
Thanks IPS - I definitely think we will see SHWZ at 1%, love the optimism of perhaps 3%. The amount of volume required for SHWZ to get there alone can push this stock up to $3 - $4 and I'd say that's a conservative guess with the number of shares available.
Another way to look at the fund buying is who among their higher percentage holdings have the funds grown disenchanted with? Say that stock is 1% of the funds holdings at the start of the year (and other funds view the stock in the same way - no longer worth a larger % of their fund). That rebalancing to SHWZ could go on for some time as they try to hit the other stock's prior percentage of 1% of the fund - so continued purchases over time to get there, consistently driving the stock up. I haven't taken the time yet to see which of the cannabis stocks are declining in terms of percentage holdings this year in the funds, but if I did, that might indicate when the buying stops for a stock like SHWZ. Say Planet 13 were 1.4% of a fund at the start of the year, this year the fund soured on it, started selling it, and buying SHWZ to get SHWZ closer to Planet 13's former holding of 1.4%. Knowing which stocks are out of favor and being sold and what % was held at the start of the year could be the best way of seeing where this fund buying could end, and based on the volume to get there, what that could mean for the stock price based upon the rise we've seen so far, and extrapolate that out. Maybe too much math for my fuzzy brain, but I'm wondering if that's a potential scenario to calculate among the more elite traders here?
I'm not as big a shareholder as you, but have now about what I want in SHWZ after paring a little more at the 1.50 mark today. Nice to see that volume explosion. The question remains, how long does this keep happening? If this were due to potential rescheduling why aren't more stocks moving in this space, especially among the best in class? Or is this really just the funds deciding to go much heavier on SHWZ and it's as simple as that?
And just like that we're green...
Yes, aren't many days with MJ investing recently that I've felt good about a move...
Unfortunately no. It seems irrational to me for the MSOs to purchase shares as they have, and for SHWZ, usually the red-headed step-child, to be one of the few heading north. That indicates someone is privy to information or a solid rumor we don't have as my only possible rationale for the continued buying below 1.50. Will be interesting to see what happens if we cross that. Nevertheless, I've been selling into some of these pushes higher since I was over-weight here, to get to a more reasonable core position - first time ever selling SHWZ. If I can't explain why it's going up and whether that can be sustained, I don't want to watch this fall all the way back down again when the buying pressure eases, without taking some shares off the table. I want to get to a significant but less over-blown position here.