Canadian cannabis stocks continue to steal headlines as licensed producers continue execute and advance their story.
These developments take place ahead of Canada’s plan to legalize recreational marijuana and we are bullish on these developments. Today, we have highlighted 3 Canadian cannabis company updates that we think investors need to be aware of.
Harvest One Makes a Strategic Acquisition
Harvest One (HVST.V) traded higher yesterday after the company’s subsidiary, United Greeneries Holdings Ltd., made a significant acquisition. The licensed marijuana producer singed a binding purchase agreement for 398 acres of agricultural land in British Columbia for $949,000.
The land is strategically located in a geographical area that displays climate characteristics which the company believes are comparable to Northern California. This acquisition is part of a comprehensive cannabis outdoor growing strategy and we are favorable on the differentiated strategy. The company believes that the growing conditions are ideal and can produce premium cannabis at significantly lower costs when compared to indoor operations.
Earlier this month, Harvest One raised more than $20 million in a bought deal and management expects that the capital expenses and the initial operating costs for the new outdoor growing strategy will be fully funded. The company retained several experts and consultants from Europe and California in support of this initiative, who have indicated a potential harvest up to 50,000kg by September 2019.
We are favorable on this acquisition and believe that it will help Harvest One further differentiate its value proposition. We have Harvest One near the top of our radar and investors need to keep an eye on this one.
Emblem Launches Four Cannabis Oils
Yesterday, Emblem Corp. (EMC.V) (EMMBF) traded higher after the marijuana producer launched four cannabis oils that can be ordered online or by phone. Emblem patients will receive a 10% discount on their first oil purchase.
Each are packaged with an oral syringe to ensure consistency and accuracy in measuring exactly how much oil is ingested, allowing patients to better titrate and administer each dose the exact same way.
Organigram Trades Lower After Reporting Earnings
Yesterday, Organigram Holdings Inc. (OGI.V) (OGRMF) traded lower after releasing fourth quarter financial results which ended on August 31st. We remain bullish on Organigram and believe that the company is well positioned for above average growth in 2018.
During the quarter, the licensed medical marijuana recorded net loss of $10,889,678, adjusted EBITDA (excluding FV adjustment) of ($7,798,604), and cash flow from operations of ($5,818,444).
Some of the key developments that occurred after the quarter ended include:
- September 6th: Entered a memorandum of understanding with the New Brunswick Innovation Research Chair to jointly develop an industry leading method of microwave extraction of cannabinoid extracts
- September 15th: Entered a memorandum of understanding with the Province of New Brunswick for the supply of cannabis for the recreational market. Under the agreement, Organigram has guaranteed an annual supply of a minimum of 5 million grams of cannabis ($40 million to $60 million per year).
