TREES Corporation (CANN)

[Alan Brochstein]

Yes, the valuation is real easy to figure out here. First, though, when you do acquisitions, it artificially inflates your revenue. That is what is happening at CANN. The last quarter showed very little sequential growth in sales.

The valuation here is clear. The company had to give 9mm shares at .525 just to borrow money at 12%. Only in penny stocks does the CEO get away with crap like that.

A money loser like CANN that raises debt at 12% and sells equity at .525 like this is not worth a lot. 5X sales would make sense to me as being an expensive level. $15mm into 25mm shares works out to $0.60. There you go. Watch it go right back there in six months...