Fire & Flower Holdings Corp (FAF)

[FUNMAN]

Why Investors Are Warming Up To Fire & Flower Holdings Corp (TSE:FAF)

(OTCMKTS:FFLWF)

Published 2 days ago on
January 20, 2020
By Jim Bloom

This reads like a paid for article, but there is no mention of Couche-Tard and what they bring to the table. That's a huge omission.

Couche-Tard and the partnership with FFLWF is the principal reason I invested in FFLWF. - FUNMAN

Read at this link to see the charts and graphs:

https://mjglobalreport.com/investors-fire-flower-holdings-corp-tsefaf-otcmktsfflwf/

The disastrous 2019 taught investors the importance of carefully screening cannabis stocks for great picks that can withstand industrywide shocks. That explains why investors are warming up to Fire & Flower Holdings Corp (TSE:FAF) (OTCMKTS:FFLWF) in 2020.

Fire & Flower Holdings has positioned itself to take full advantage of the recently expanded cannabis market under Cannabis 2.0. Investors are realizing that FFLWF is one pick that can make a huge difference in their cannabis portfolio. Fire & Flower Holdings has already gained more than 25% year-to-date, a testament to the strong investor interest in the stock in 2020.

About Fire & Flower Holdings

Fire & Flower Holdings is a Canadian cannabis company. It operates as a cannabis product retail chain. It operates a network of dozens of cannabis retail outlets in Canada. FFLWF currently has licenses to operate cannabis retail stores in Alberta and Saskatchewan provinces. In addition, it runs a cannabis distributor business in Saskatchewan.

Investors will no doubt remember that 2019 was a tough year for the cannabis sector, with a widespread collapse of many cannabis stocks big and small. That shows why in 2020 investors are looking for cannabis stocks that can deliver excellent returns and make them forget the pain of the past year. FFLWF has emerged as one of the favorite cannabis stock picks for investors early on in 2020. There are several reasons behind that and here are a few notable ones.

FFLWF achieves cannabis retail stores opening milestone

As a cannabis retail business, Fire & Flower Holdings knows that its strength lies in having enough number of stores to serve cannabis consumers in Canada. More importantly, the company understands the value of planting its stores in strategic locations.

Fire & Flower Holdings had 30 stores in November 2019 and set out to have 45 cannabis retail stores up and running by February 2020. But it has achieved that target several weeks in advance. On January 13, the company announced that it now has a network of 46 cannabis retail stores open and operating.

Reaching the store opening milestone ahead of target no doubt demonstrates FFLWF’s commitment to keeping its promises to shareholders. FFLWF looks to open more stores across Canada, which should allow it to make more sales and become profitable quickly. The company reported revenue increase of 443% year-over-year to C$13.7 million in fiscal 2019 third quarter ended November. The strong revenue growth saw operating loss for the quarterly nearly halving to C$5.9 million from C$10.4 million a year earlier.

Ontario is firmly on Fire & Flower Holdings radar right now. The Ontario provincial administration last month announced steps to address the cannabis retail shops shortage in the province. Therefore, from this coming Apri,l the Ontario administration wants to enable the opening of 20 stores every month. There were only about 25 stores across Ontario at the end of 2019, yet the province has the largest population in Canada with more than 14 million people. Efforts to address cannabis stores shortage in Ontario presents an attractive opportunity for FFLWF to widen its retail network and capture more sales and create value for shareholders. Store shortage is thought to have kept big cannabis demand in the black market. Therefore, easing the store shortage problem in Ontario would help grow the legal cannabis market in Canada quickly.

Fire & Flower Holdings Cannabis 2.0 products go on sale in Saskatchewan

Fire & Flower Holdings became one of the first cannabis retailers to stock the newly approved adult-use cannabis products when sales for those products opened last month under what the industry fondly calls Cannabis 2.0. FFLWF began the sale of its Cannabis 2.0 products in Saskatchewan, thanks to its wholesale business in the province. The company is initially selling cannabis edibles such as cannabis-infused chocolate, mints, and gummies. It also sells cannabis smoking devices or vape pens. Cantor Fitzgerald analysts estimate that Cannabis 2.0 could double Canada’s adult-use cannabis market to C$2.4 billion in 2020. That is why being a first-mover with Cannabis 2.0 products positions FFLWF well in Canada’s cannabis market.

Many of last year’s challenges are out of the way for FFLWF

The broad collapse of cannabis stocks last year stemmed from several factors that dented investor confidence in the sector. They included uncertainty over Canada’s national elections and the shortage of cannabis shops in Ontario. These concerns are now largely out of the way. The election issue is settled with the pro-cannabis government of Prime Minister Justin Trudeau back in office. In Ontario, the administration there has started addressing the retail store shortage problem and that should help take cannabis demand from the black market, which will benefit FFLWF.

Bottom line

Fire & Flower Holdings looks poised for a breakout in 2020 on the back of strong fundamentals. FFLWF management is also doing a great job keeping investors informed. 2020 looks to be a big year for Fire & Flower Holdings.

Disclosure: We have no position in Fire & Flower Holdings and have not been compensated for this article.