Hi Guys,
Cannabis Futures, great review. And mostly I am on the same page with you. However you need to consider wholesale prices to retailer vs. retail pricing.
Even given that point NGW is currently very under valued.
One very, very important point from the web call by management last Friday. Mike stated that they are using the new facility for packaging and plantlet growing. That is allowing them to free up space in the existing grow facility to plant more flowering Cannabis plants.
They have 3500 sq ft. in the new facility. So likely they would have given NGW addition grow area of about 10%. And move the total stated pounds of grow per year from 9500 to 10400 pounds of weed per year.
So all estimates should be raised accordingly.
Mike stated months (early spring web call) ago that his goal was to transform NGW sales from a bulk supplier to a packaged goods branded NGW supplier.
His goal was to move toward 90-100% packaged goods NGW products using the NGW premium flower and plant extracted product. This move is well on its way. But will take until end of the first quarter 2021 to complete properly.
By then the sales will be moving much, much higher. My thoughts is that by the end of the first quarter of next year NGW will be selling at least $2,500,000 USD per month. And in addition they will begin to sell plantlet to other growers. So lets add $250,000 per month in sales of plantlets, moving to $500,000 per month. Or annual sales run rate of $35,000,000 USD per year.
Lets use price to sales at 3 x $35,000,000 = 105,000,000.
Share price would be $105,000,000/170,000,000 shares out standing
= $.61 USD
Likely by the end of the first quarter the new facility construction would have begun and Wall Street should be paying a lot more attention to NGW. And thereby assigning a premium to the price of the shares.
So by the end of the second quarter on 2021 my outlook for the share price is at $.75 USD
Buying more as funds become available.
GLTA
