The election is likely to be a major catalyst for the pot stock space, just as it was in 2016, as a number of states are coming to the ballot box with legalization in the wind, and the Biden administration has already announced its leanings toward nationwide decriminalization, and holds a wide lead in the polls.
That should be enough to spark what one might call “Green Wave 3.0”, which could light a fire under the space in the weeks ahead.
With that in mind, we take a look here at a handful of the most interesting names in the space, including: Green Thumb Industries Inc (OTCMKTS:GTBIF), Trulieve Cannabis Corp (OTCMKTS:TCNNF), Sugarmade Inc (OTCMKTS:SGMD), and Innovative Industrial Properties Inc (NYSE:IIPR).
Green Thumb Industries Inc (OTCMKTS:GTBIF) bills itself as a company that manufactures and sells various cannabis products in the United States. The company’s cannabis products include flower, concentrates for dabbing and vaporizing, edibles, and topicals.
According to company materials, “Green Thumb Industries (GTI), a national cannabis cultivator, processor and dispensary operator, is dedicated to providing dignified access to safe and effective cannabis nationwide while giving back to the communities in which they serve. As a vertically integrated company, GTI manufactures and sells a well-rounded suite of branded cannabis products including flower, concentrates, edibles, and topicals. The company also owns and operates a rapidly growing national chain of retail cannabis stores called RISE(TM) dispensaries. Headquartered in Chicago, Illinois, GTI has seven manufacturing facilities and licenses for 50 retail locations across seven highly regulated U.S. markets. Established in 2014, GTI employs more than 350 people and serves hundreds of thousands of patients and customers each year. GTI was named a Best Workplace 2018 by Crain’s Chicago Business.”
Green Thumb Industries Inc (OTCMKTS:GTBIF) just announced an exclusive partnership to open Cookies on the Strip in Las Vegas, the first Cookies store in Nevada. Cookies on the Strip will sell the acclaimed portfolio of Cookies, Lemonnade, Runtz, Minntz, Collins Ave, Run The Jewels and Grandiflora products in the brand’s signature retail environment and is expected to open in the first quarter 2021, subject to customary regulatory approvals.
According to the release, based in the Bay Area, Cookies’ Founder and CEO Berner is a prolific rapper and entrepreneur along with his partner, Jai, a highly respected cannabis cultivator and breeder.
While this is a clear factor, it has been incorporated into a trading tape characterized by a pretty dominant offer, which hasn’t been the type of action GTBIF shareholders really want to see. In total, over the past five days, shares of the stock have dropped by roughly -3% on above average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities. Shares of the stock have powered higher over the past month, rallying roughly 4% in that time on strong overall action.
Green Thumb Industries Inc (OTCMKTS:GTBIF) pulled in sales of $165.8M in its last reported quarterly financials, representing top line growth of 177%. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($113M against $181.8M, respectively).
Trulieve Cannabis Corp (OTCMKTS:TCNNF) just announced the launch of two new flavors to the TruPowder line: Vanilla Cream and Lemon. The TruPowder flavors will be available in all dispensaries across Florida starting today. TruPowder is a Nano-encapsulated Cannabinoid powder. Using cutting edge and state of the art technology TruPowder uses sound waves (sonication) to achieve incredibly small nano-sized Cannabinoids which are then encapsulated.
“Trulieve is excited to be launching our newest flavors of Vanilla Cream and Lemon to our TruPowder line. We are focused on delivering an exceptional and differentiated customer experience, and that includes offering the broadest selection of high-quality cannabis products,” said Trulieve CMO Valda Coryat. “Trulieve continues to be the leading source for both quality and accessibility, and were first to offer ingestible products in the state of Florida. With our newest TruPowder flavors, that will further extend our variety of cannabis offerings for Florida patients.”
Trulieve Cannabis Corp (OTCMKTS:TCNNF) engages in the cultivation, possession, distribution, and sale of medical cannabis in the United States. It offers a suite of Trulieve branded products with approximately 125 SKUs, including nasal sprays, capsules, concentrates, syringes, and cannabis flower in tamper-proof containers for vaporizers, topical creams, tinctures, and vape cartridges.
According to company materials, “Trulieve is a vertically integrated “seed to sale” company and is the first and largest fully licensed medical cannabis company in the State of Florida. Trulieve cultivates and produces all of its products in-house and distributes those products to Trulieve branded stores (dispensaries) throughout the State of Florida, as well as directly to patients via home delivery. Trulieve is listed on the Canadian Securities Exchange under the symbol TRUL.”
While this is a clear factor, it has been incorporated into a trading tape characterized by a pretty dominant offer, which hasn’t been the type of action TCNNF shareholders really want to see. In total, over the past five days, shares of the stock have dropped by roughly -7% on above average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities. Shares of the stock have powered higher over the past month, rallying roughly 25% in that time on strong overall action.
Trulieve Cannabis Corp (OTCMKTS:TCNNF) pulled in sales of $167.3M in its last reported quarterly financials, representing top line growth of 115.9%. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($204.7M against $136.3M).
Sugarmade Inc (OTCMKTS:SGMD) is in the process of expanding into the LA area for its BudCars cannabis delivery business. This is likely to be a strong source of new strategic growth for a company that has already been posting sequential monthly growth above 30% on the topline for several consecutive months after making its flagship investment in BudCars.
At this point, based on recent disclosures from the company, we have a clear sense that, not only is the first LA location on track and simply awaiting some factors no doubt slowed by the pandemic – city council isn’t exactly on vacation right now. Crisis mode is the standard setting for most administrative affairs in local government around the country right now. However, the other key piece here is that the second LA BudCars location is ahead of schedule. That’s perhaps even more important here.
Sugarmade Inc (OTCMKTS:SGMD) also recently issued its performance update for the month of July, where it saw total July BudCars gross sales come in at of $662,836, representing 32% month-over-month sales growth, which represents the fourth month in a row that we have seen that kind of monster monthly growth from this company.
In addition, the company reported total July BudCars gross profits of $310,489, representing 36% month-over-month gross profit growth. Again – that’s insane. We also saw average daily gross sales increase 32% m/m to $22,095, total customer tickets increase 33% m/m to 5,579, and calendar Q3 move to a pace to potentially more than double calendar Q2 total BudCars sales. That means we are likely going to see BudCars post over 100% sequential quarterly growth.
Sugarmade Inc (OTCMKTS:SGMD) has been posting major growth updates on a regular basis over the past couple months as its BudCars model takes apparent flight. The rate of sales growth expected from the company in 2020 has walked up a steep ladder, with the latest guidance suggesting we could see it north of $30 million in annualized sales by year-end, which would represent blow-out growth in 2020 for the company by any reasonable standard.
Innovative Industrial Properties Inc (NYSE:IIPR) is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated medical-use cannabis facilities.
The company touts itself as the first and only real estate company on the New York Stock Exchange focused on the regulated U.S. cannabis industry.
Innovative Industrial Properties Inc (NYSE:IIPR) just recently announced that it entered into an amendment of the lease with a subsidiary of Ascend Wellness Holdings, LLC (AWH) at the property located in Barry, Illinois, making available an additional $18 million in funding for expansion of AWH’s regulated cannabis cultivation and processing facilities at the property, including a new 90,000 square foot greenhouse facility and further production capacity enhancements for the existing 75,000 square foot industrial facility located on the property.
According to the company’s release, the lease amendment also adjusted the base rent under the lease to take into account the additional available funding. Assuming full payment of the additional funding, IIP’s total investment in the property will be $51 million.
And the stock has been acting well over recent days, up something like 3% in that time. Innovative Industrial Properties Inc (NYSE:IIPR) generated sales of $24.3M, according to information released in the company’s most recent quarterly financial report. That adds up to a sequential quarter-over-quarter growth rate of 15.2% on the top line. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($384.9M against $0).
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