Medicine Man Technologies Inc (SHWZ)

[olivernoyes]

Updated Share Count Analysis for Schwazze (6/28/23)
Below is a Share Analysis for SHWZ with a breakdown of future share issuances based on a combination of acquisition payments/earnouts, option festing, and PIKs from the Preferred and Convertible Debt. The above assumes Fully Diluted on an "as if converted basis" for all equity. Given today's share price, many of the Options, Warrants and Convertibles are out of the money.

r/SHWZ - Updated Share Count Analysis for Schwazze (6/28/23)
Overall, at the end of Q2'23 we should have basic shares issued in the neighborhood of 72MM (vs. 56.352MM shares issued at the end of last quarter).

Much of this growth will be from the recent closings of the acquisitions of Evergreen/Everest, Akimbo, and Smokey's.

The Dilutive securities (i.e., the PIK components of the convertible debt and preferred shares) will continue to be an albatross on the overall FD "as if converted" share count for the next couple of years (until the debt matures or is paid off). Today, it adds a little over 2MM shares per quarter to that count.

However, as long as SHWZ is able to deploy capital with returns in excess of its cost of capital, then it will be manageable.

I suspect management will look to pay down the convertible debt (which is the biggest culprit to that overhang) but not till either SAFE Banking is passed or until the latter half of 2025 when it has gotten past the bulk of the prepayment penalties.

I remain bullish on Schwazze, but with the softness in the Cannabis Sector we are witnessing in New Mexico due to increased dispensary counts and margin compression, I am lowering my prior 12-month valuation estimate of $2.5 to $3/share to a reduced range from $2 to $2.5/share to reflect the macro conditions on the Cannabis sector (not the performance of the company as a whole, which has been exemplary to say the least).

https://www.reddit.com/r/SHWZ/comments/14ldomk/updated_share_count_analysis_for_schwazze_62823/

Use the link to see the chart