For the past few years, the cannabis industry has been highly active thanks to the pot legalization in North America. Many cannabis companies have popped up, and some are even listed on stock exchanges.
The cannabis industry is currently considered a high-growth area, especially with pot, CBD, and hemp products expanding exponentially. Unfortunately, investors looking to invest in pot stocks may currently find it rather difficult to determine which stocks are ideal investments because the coronavirus is a huge cloud overshadowing multiple industries.
Regardless of the current situation, there are still many investment opportunities out there, and it is a matter of finding companies with good fundamentals, as well as a positive growth outlook and strategic moves. Acreage Holdings Inc (OTCMKTS:ACRGF), KushCo Holdings Inc (OTCMKTS:KSHB), Xphyto Therapeutics Corp (CNSX:XPHY) and Constellation Brands, Inc. Class A (NYSE:STZ), as well as their latest developments.
Acreage Holdings Inc (OTCMKTS: ACRGF) Finalizes The Acquisition Of New Jersey-based Compassionate Care Foundation
Acreage Holdings Inc (OTCMKTS:ACRGF) ended July with an announcement that it has completed its acquisition of Compassionate Care Foundation. The latter is a non-profit medical cannabis foundation.
Acreage Holdings initially revealed plans to acquire CCF in November last year. Acreage will acquire all of CCF’s operations as per the acquisition agreement. The cannabis company also plans to consolidate the operation results of CCF into its financial statements as part of the integration.
Acreage Holdings will also acquire all of CCF’s liabilities, debt, and other obligations as part of the acquisition deal. This includes the expenses, costs, and fees that CCF has incurred as part of its operations. The acquisition is expected to tie in nicely with Acreage’s cannabis operations in New Jersey, where it is licensed to cultivate, manufacture, and process cannabis. It also has three dispensaries in New Jersey.
Acreage is currently expanding its operations to serve the growing demand for both medical and recreational marijuana more effectively. The acquisition of CCF will allow Acreage to expand at a faster pace.
KushCo Holdings Inc (OTCMKTS:KSHB) rolls out a strategic plan and other measures to streamline its operations
KushCo Holdings Inc (OTCMKTS:KSHB) announced a new strategic plan earlier this year through which planned to attain a positive adjusted EBITDA. The plan includes leadership changes and other cost-cutting measures aimed at helping the business reach the ideal size for optimal growth.
“After more than doubling sales in each of the last five years, we entered fiscal 2020 embarking on a new strategy to rationalize all aspects of our operations,” stated Nick Kovacevich, the CEO of KushCo Holdings.
Kovacevich also added that KushCo has been focused on aligning itself with the best CBD and cannabis operators in the market while targeting short-term profitability. The CEO also noted that the company has remained focused on the plan, although he did acknowledge that this year has been extremely challenging due to the coronavirus, which brought a lot of uncertainty in the market.
The CEO also disclosed that some of the company’s customers have been heavily affected by the coronavirus situation. Meanwhile, KushCo has taken the necessary steps to streamline its warehouses, slash overhead costs, adjust its sales strategy, and even reduce its inventory. These measures aim to make sure that the company does not run out of cash to maintain its operations.
The strategic plan is not only aimed at helping KushCo to stay afloat but to continue generating value for investors. The cannabis company has also developed a strategic plan that will divert its resources towards more optimal target clients as part of its strategy to maintain a positive EBITDA.
Constellation Brands, Inc. Class A (NYSE:STZ) announces the Q1 financial earnings for its fiscal year 2021, acquires Empathy Wines
Constellation Brands, Inc. Class A (NYSE:STZ) recently released the first-quarter earnings of its 2021 fiscal year on July 1. The company’s Chief Financial Officer Garth Hankinson revealed that the company had a strong first quarter thanks to its ability to steer through uncertain territories, especially with the coronavirus situation.
Hankinson noted that Constellation Brands managed to achieve better margins in its spirits, wines, and beer segments. Its operating cash flow grew by 16% while its free cash flow was up by 24%. The cash flow improvements were pivotal towards paying off some of its debt and also facilitating liquidity.
As far as the sales during the quarter were concerned, the company’s beer sales dropped by 6%. The company’s net sales were also down by 4%. Wines and spirits sales dropped by around 25% to 30% during the quarter. The company’s performance during the quarter took a hit due to the impact of the coronavirus.
Constellation Brand also announced on July 6 that it acquired Empathy Wines, a direct-to-consumer brand that sells wines on digital platforms. Constellation’s spokespersons pointed out that the acquisition will boost the company’s vision for its wines and spirits business. Constellation plans to work hand in hand with Empathy Wines facilitate growth for the brand.
Xphyto Therapeutics Corp (CNSX:XPHY) achieves successful results with its COVID-19 rapid test kit
Xphyto Therapeutics Corp (CNSX:XPHY), a company known for its scientific research involving medicinal uses of cannabis, has announced that its novel COVID-19 rapid test kit yielded good results as far as accurately testing for the coronavirus is concerned.
The company proudly made the announcement together with its diagnostics partner, called 3a-Diagnostics. The two companies currently plan to commercialize the proprietary COVID-19 testing kit as a low-cost alternative to other test kits available in the market. It is an oral test kit designed to determine the coronavirus’s presence in subjects, especially in the early stages of infection.
Early detection is important because it allows anyone that is infected to get treatment before their health situation gets worse. The test kit is designed to facilitate testing using saliva samples, although it can also work with nasal swabs and throat swabs. The testing of the prototype COVID-19 test kit was conducted in Baden-Württemberg, Germany, where 3a’s laboratory is located.
“We believe that a low-cost, portable, and easy-to-use screening tool that provides rapid on-the-spot results would be a disruptive tool in the fight against pandemic threats,” stated XPhyto CEO Hugh Rogers.
Rogers also added that the company believes that there are huge growth opportunities from the test kit’s sale. Thanks to its ease of use as well as low-cost, the COVID-19 test kit can be used by individuals, schools, households, public transport facilities, airports, and many other areas. Xphyto and 3a plan to expedite the production and further testing so that they can deliver a highly accurate product to the market as soon as possible.
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