Indiva Limited Continues To Fly Under Investors Radar Despite Constant Revenue Growth
EDITORIAL Apr 27, 2022 • 7:12 AM EDT
Earnings season is kicking into high gear as the overall market is trading in a volatile pattern and cannabis companies recently started reporting results.
Today, we highlighted Indiva Limited (TSXV: NDVA) (OTCQX: NDVAF) after it reported fourth quarter financial results and believe the business is flying under the radar. During the quarter, the company reported major advancements and has leverage to every province and territory in Canada.
Although Indiva does not get the attention of large-scale Canadian Licensed Producers (LPs), we believe the business has been executing on a multi-faceted growth strategy. During the quarter, the Canadian cannabis company generated more than $10 million of revenue which represents a more than 25% increase over the prior quarter.
According to data from Hifyre, Indiva had the largest market share in Canada for cannabis edibles in 2021 and we find this to be significant. During the year, the company’s distribution expanded to reach all 13 provinces and territories in Canada and we are favorable on how the footprint has improved. By expanding its reach, Indiva is creating a platform that can be leveraged for new product introduction through new licensing partnerships and in-house innovation.
In the earnings report, Indiva said it expects revenue in the current quarter to be lower than the fourth quarter but higher on a year-over-year basis. The management team is focused on improving margins through the implementation of automation in the production and packaging of edible products.
Although Indiva has been one of the most significant growth stories in the Canadian cannabis industry, the business receives minimal coverage from major financial media firms. We believe the business is flying under the radar and are bullish on how the management team has been executing.
So far this year, Indiva has been under pressure with the rest of the cannabis sector and the stock has fallen more than 30%. At current levels, we believe the valuation is compelling and will be monitoring how the story continues to advance in 2022 and beyond.
