Profit Confidential just renewed their recommendation of TILT about 12 days ago. This is what they wrote:
44 Cent Pot Stock Ready for Big Comeback (was $2.50)
Beaten-down stocks are usually not the safest bets. But if the situation at an out-of-favor company turns out to be not as bad as what market participants had thought, the stock might be able to make a strong comeback.
With that in mind, let's check out TILT Holdings Inc (OTCMKTS:TLLTF, CNSX:TILT). Most people have never heard of TILT Holdings, but the company comes from one of the fastest-growing industries in the stock market: legal pot.
Headquartered in Boston, TILT Holdings is a vertically integrated technology and infrastructure pot company.
You don't really hear about TILT Holdings stock when analysts talk about pot stocks because it is quite a bit different from most companies in the legal weed industry. Rather than just growing plants, the company provides comprehensive operations and software solutions at each stage in the supply chain.
For instance, TILT Holdings' wholly-owned subsidiary Jupiter Research, LLC focuses on the design, development, and manufacturing of vaporizing technologies for natural plant-derived oil.
Blackbird Logistics Corporation, another of TILT Holdings Inc's wholly-owned subsidiary, offers operations and software solutions for pot wholesale and retail distribution.
Meanwhile, TILT Holdings also owns Baker Technologies Inc, which offers a customer relationship management platform that helps dispensaries expand their business.
TILT Holdings Inc is listed on the Canadian Securities Exchange under the ticker symbol "TILT." But for U.S. investors who want to get a piece of the action, they can find it trading over the counter under the symbol "TLLTF."
As I mentioned earlier, this is a beaten-down stock. Since the beginning of this year, TLLTF's share price went from $2.50 to $0.44, marking a drop of more than 80%.
LMAT chart
Chart courtesy of StockCharts.com
The thing is, though, while TILT Holdings stock is out of favor with investors these days, it still manages to grow its business.
As a matter of fact, the company has just reached a major milestone.
On September 5, TILT Holdings announced that between its three subsidiaries, the company has reached the milestone of supporting 2,000 brands across North America.
In other words, despite having a plunging share price, the company has actually built a solid presence in the weed industry.
Its financials have been improving, too.
In the second quarter of 2019, TILT Holdings generated $39.0 million of revenue, marking a solid 13% increase from the first quarter. The year-over-year improvement was even bigger because, in the year-ago period, the company did not generate any revenue.
Meanwhile, the company narrowed its adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) loss from $7.9 million in the first quarter of 2019 to $4.0 million in the second quarter.
What's even more exciting is the company's progress after the second quarter.
In just the month of July, it's estimated that TILT Holdings generated $15.0 million of revenue. At the same time, it's estimated that the company earned an adjusted EBITDA of $500,000 in July, marking its first-ever month of positive adjusted EBTIDA.
Add it all up and you'll see that TILT Holdings Inc's business isn't doing nearly as badly as what its stock price performance seems to suggest.
In fact, as the pot industry enters the main stage, I wouldn't be surprised to see more companies sign up to use one of the many services offered by TILT's subsidiaries.
Bargain-hunting investors who want to get exposure to the booming pot industry should take a serious look at this low-priced stock.
AI
