Dear Alphastox Subscribers,
I have been getting a lot of questions on a company we’ve been covering for quite a while now, PUF Ventures (CSE:PUF) and wanted to make sure I sent everyone a quick note. Although PUF.C has been quite slow in the market, I think that will soon change. The company has been progressing nicely operationally and I’m hopeful that 2016 will be the year we can see all their hard work finally come to fruition.
Over the last twelve months, the company has made some significant strides forward: Their AAA Heidelberg cannabis facility in London, Ontario passed their security clearance and entered into the review stage. Now that’s a huge step forward that I don’t think the market quite realized. At an $1,800,000 market cap, that’s where I see the biggest upside for investors. Many experts in the field have already told me that gaining security clearance is the hardest part in the process of securing an MMPR license in Canada. Now that that’s finally behind the company, management believes it’s only a matter of time before they get their license. So what’s a license worth? Judging from other licensed public companies on the exchange today like Aurora Cannabis (CSE:ACB), Canopy (TSXV:CGC), Organigram (TSXV:OGI) etc., many can argue that an MMPR license is worth around $10,000,000 or over 5X the value of where PUF.C is currently trading at today. Now there’s obviously no guarantees of that happening but with security clearance granted, the company is well on its way towards achieving their goal and since I have a very large share position in the company myself, I’m hoping they can get it over the line.
Not only that, but PUF also completed the purchase of a 9.7 acre parcel of land in Whatcom County, Washington. PUF purchased the property for around USD $1.2 million and has a USD $1.08 million mortgage on it which is due on May 31st, 2017. Since the property is licensed, they’re looking to become a landlord and lease-out the space to potential licensed growers. Yari and his team are also working hard to secure a potential JV/strategic partner so stay tuned for that news.
VapeTronix - The company announced that it’s introducing a premium e-liquid/e-juice product line to its existing 1313 brand of e-cigarettes. Purchase orders are already coming in but I’m hoping to see a much larger order come in shortly.
At less than an $1,800,000 market cap, I think investors have more than one reason to keep PUF.C on their radar screens. If they get an MMPR license, I could easily see this stock trading at much higher levels and giving investors a significant reward on their investment. Not only that, but as they look to secure a JV partner in Washington and continue to increase revenue on their e-cigarette line, this is a story that could trade based on a revenue multiple over time. Now, it’s obviously very early stage and probably too early to talk about that now but I wanted to keep it in the back of your mind as the sector and company continues to develop. With an exciting pipeline in the mix and if they’re able to achieve some of their short-term goals, PUF could easily outweigh many of our 2016 expectations.
Now that everyone’s back at their desks and ready to work, I expect a lot more news to come in short order so stay tuned. I should also have a more thorough report to come once I speak to management but in the meantime, please feel free to get in touch with me anytime. I look forward to hearing from you.
Best,
Etienne
AI
