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The Growing Case for Cannabis Global Inc (OTCMKTS:MCTC)

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MCTC Holdings Inc (OTCMKTS:MCTC), now doing business now as Cannabis Global, Inc. (MCTC), is starting to look like an increasingly interesting stock in the small-cap cannabis space for a number of reasons, prompting our analysis here as part of our mission to provide insights into under-the-radar speculative opportunities in the cannabis, CBD, and hemp sector.

From a macro perspective, one can easily make a case that the overall sector has transitioned from persistent, glut-induced headwinds to post-purge structural tailwinds. In a robust long-term growth thesis, that’s the crucial moment of opportunity. It is imperative for aggressive investors to find new ways to position at this stage given this transition.

 

The Big Point

MCTC Holdings Inc (OTCMKTS:MCTC) demands special attention for two key reasons. First, the company is right now making the jump from development-stage operations to full commercialization of its base of proprietary IP. Second, this is one of the very few IP-heavy plays in the cannabis space, with robust R&D and a strong portfolio of patents now in process with the USPTO.

That latter point is especially important because the company’s IP continues to expand as a market-leading foundation, with a growing list of partners pining for access to infusion methods in the edibles space, and because the edibles niche is increasingly looking like the big opportunity as cannabis edges toward universal mainstream popularity.

 

Laying a Foundation

For example, the company just announced the signing of a definitive, five-year agreement for the production of cannabis edibles and beverages in conjunction with licensed California cannabis operator, Magnolia Extracts, LLC. Under the terms of the agreement, Cannabis Global will provide access to its trade secrets and patent pending technologies for chemical-free cannabis and hemp infusions in the production of tetrahydrocannabinol (THC) containing edibles and beverages.

“This deal represents an enormous escalation in terms of our positioning in the California cannabis edibles and beverages marketplace,” stated Arman Tabatabaei, CEO of Cannabis Global. “We will be working closely with Magnolia and look forward to a rapid path to market for these innovative products. We have strong reason to believe we will see a relatively quick expansion in distribution footprint given the prepotency of demand we are seeing among potential distribution partners already. The Magnolia site has recently been modified to our specifications and is now complete. We are looking forward to moving out of our initial stage of development and into full-scale production. This Agreement is a game-changing development with strong tangible implications for our performance this year.”

 

The Crux of the Matter

Remember: the big driver of this whole theme is the inexorable trend toward universal legalization of cannabis-based products. If you have any doubts, it’s time to do a personal reality check. The art of successful speculative investing is driven by forming derivative conclusions around a core idea that commands conviction. In this case, the inevitability of the long-term trend toward increasing mainstream integration of cannabis products as legal doors open step by step is that core idea.

From there, the most interesting opportunities are unappreciated and underpriced companies that have built a foundation of valuable proprietary assets that have the potential to increase in applied market value by huge leaps as they become essential in the ecosystem of the market phenomenon in question.

We see Cannabis Global, Inc. (MCTC) as precisely that kind of opportunity right now. The stock has yet to garner attention from the crowd. But it has a rapidly growing role as a core technology provider for many other companies building strong market positions in the industry.

 

The Only “Varin”

Aside from its formidable edibles infusion IP, the company has also recently made big strides toward establishing a new cannabinoid market with its “Project Varin”. This is potentially a huge future driver of growth for the company because it represents a segment with enormous demand possibilities and virtually no competition. That’s precisely where an IP-driven model has the most potent impact.

Project Varin refers to the company’s initiative to develop new delivery systems for varin cannabinoids. THC-V, which is one of the best known Varins, is becoming known within the cannabinoid sciences arena as the ‘Skinny Cannabinoid’ due to its purported appetite suppression qualities, and its possible use as a treatment against obesity-associated glucose intolerance

The project has already yielded strong results, including a research breakthrough in the form of a new tetrahydrocannabivarin (THC-V) delivery system providing for sustained release of the cannabinoid over a predetermined period of time and two other delivery systems for immediate release.

“While these developments add to our growing list of intellectual property, these are much more than technologies that will sit on a shelf,” commented Arman Tabatabaei, CEO of Cannabis Global. “We have already integrated both the sustained and immediate release versions into beverage products that we expect to be available to consumers next month. We believe the field of minor and exotic cannabinoids will grow substantially this year with several product introductions. We are extremely excited at the prospect of being a first mover in this emerging market segment.”

 

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Singlepoint Inc. (OTCMKTS: SING) In A Joint Venture With Box Biosciences To Produce and Distribute Hand Sanitizers

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Singlepoint Inc. (OTCMKTS:SING) has formed a joint venture with BOX Biosciences to distribute various hand-sanitizer products produced in Carlsbad, California.

Singlepoint joint venture producing FDA-approved sanitizer

The two companies are distributing the FDA-approved sanitizer products on the west and east coast. BOX Biosciences is headquartered in Charleston, South Carolina, with distribution outlets in Raleigh, North Carolina, and Carlsbad, California. Following the coronavirus outbreak, there has been a shortage of disinfectant and sanitizer products.

Because of the urgent need to fill this shortage, the companies through the joint venture are working to ensure the US is safe by producing bulk hand sanitizers. They will also introduce disinfectants as permitted by the demand of hand sanitizers. Already the companies have on-going sales to various retail outlets, and currently, they are in discussions for potential hand sanitizer product sales.

The sanitizers the companies are manufacturing kill 99.9% of coronavirus causing germs, and they will be available to the general public and essential businesses. For now, the companies have prioritized the sanitizers to nursing homes, clinics, hospitals, government units, and home healthcare agencies. Equally essential businesses will also get prioritized in getting the bulk hand sanitizers.

Singlepoint and Box committed to offering solutions to COVID-19

Ryan Cowell, the founder of BOX Biosciences, indicated that they will focus on bulk orders of 250 gallons, 55-gallon drums, 1 gallon, 1 liter, 32oz, and 8oz totes of sanitizer. For businesses having the ability to offload bulk sanitizer from tankers, they can also order.

Singlepoint and Box’s expansion to making disinfectant and hand sanitizers shows how companies are dedicated to offering significant well-being solutions for the environment, surfaces, and people in response to the COVID-19 outbreak.

BOX’s operations manager Troy Lorenz stated there is an urge by businesses and people to clean and disinfect their work environment, and as a result, the products they are producing are important for the environment and people. The objective of Singlepoint and Box is to help authorities and people in combating the spread of COVID-19.

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Sproutly Canada Inc (OTCMKTS:SRUTF) Chalks Out A Business Strategy To Focus On Commercialization Of APP Technology

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Sproutly Canada Inc (OTCMKTS:SRUTF) has chalked out a business transformation strategy to focus on commercializing its proprietary APP technology by moving away from cannabis cultivation resources. Infusion Biosciences Inc will contribute additional funds to implement business transformation. It will also supply additional talent to support the transformation plan.

Business transformation strategy

As part of the light technology model, Sproutly will focus on generating revenues through establishing ingredient supply agreements, technology licensing, and partnership opportunities. It will scale down the cultivation of cannabis, which is capital intensive, and reduce cash burn.

Sproutly has recruited Dr. Anup Sen as Chief Executive Officer for implementing a business transformation plan. Anup is the first scientist to invent water soluble CBD in cannabis plants. Following the appointment of Dr. Anup, Keith Dolo is relinquishing the post of CEO. Keith will also step down from the board of Sproutly. He will act as an advisor to the Chairman. Keith said the company’s main target is to introduce unique products in the market by using APP Technology. Sproutly also slashed cash expenses by giving pink slips to operational and corporate staff.

Sproutly is adopting the new business strategy because of the operational challenges and headwinds in the industry. Prohibitive costs associated with cannabis cultivation have forced the company to change its business strategy.

Commercializes APP technology

Sproutly will focus on APP technology commercialization through formulation, production, and the sale of ingredients by using Bi-Natural Oils and water-soluble cannabinoids. The company will use the licensed manufacturers’ distribution networks and its existing infrastructure to realize its revised plan. Sproutly has faced bottlenecks in introducing cannabis 2.0 products because it has earmarked human resources and significant capital for cannabis cultivation.

Adopts cost-cutting measures

Sproutly has reduced the employees by 75% to reduce costs and reduce cannabis cultivation. It has eased the capital requirements for Sproutly and pursues other strategic alternatives. The company will get the support of six key personnel of Infusion Biosciences to assist in its daily operations.

Infusion Biosciences’s key executives have helped Sproutly in obtaining licenses for APP technology and in forming partnerships in the US. Sproutly also expects to expedite its commercialization efforts with the help of these executives.

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Aleafia Health Inc (OTCMKTS:ALEAF) Reports An Astonishing 2,486% Rise In Q1 2020 Revenues

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Aleafia Health Inc (OTCMKTS:ALEAF) has reported revenues of $14.59 million in Q1 2020. It is an increase of 2,486% compared to the same period last year and a 143% increase compared to the previous quarter.

Reports solid growth for the fifth consecutive quarter

Geoffrey Benic, Chief Executive Officer of Aleafia, said the company achieved a breakthrough in Q1 2020 on the backdrop of sustainable and disciplined growth. As it builds the cannabis wellness and health ecosystem, the company gives importance to the patient-centric approach. It is the fifth consecutive quarter to report solid growth.

Expects to introduce new cannabis 2.0 products in H2

Aleafia expects to introduce new cannabis 2.0 products tailored for the wellness and health consumers in H2, 2020. Its active registered patient count has surged to 10,983 as of March 31, 2020, from 10,249 as of December 31, 2019.

Key achievements in Q1 2020

Aleafia on March 26, 2020, announced plans to introduce direct-to-door medical cannabis delivery service to the registered patients. It is a contactless and safe delivery mechanism for the patients. Therefore, Aleafia eliminates the need for collecting the products from post boxes and post offices.

Achievements after Q1 2020

According to the announcement on May 1, 2020, Glenn Washer and Rhonda Lawson will be appointed to the board with effect from May 16, 2020. It is on the backdrop of the resignation of the existing directors – Bill Stewart, and Raf Souccar with effective from May 15, 2020. Julian Fantino, Chairman, has also resigned from the board.

Aleafia has temporarily shut down its physical offices of the education centers and cannabis clinics across the nation since March 16, 2020, because of the ongoing coronavirus crisis. The company is completing the patient consultations via its virtual clinics.

To maintain long term success, the company maintains a diversified portfolio of differentiated and high-quality product formats. The company will use in-house facilities to manufacture cannabis 2.0 products and satisfy the demand in the medical and adult-use cannabis markets in Canada. It will also supply cannabis 2.0 products in markets worldwide where legally permitted.

Aleafia Farms Inc, a wholly-owned subsidiary of Aleafia, has secured an amended license from Health Canada on May 12, 2020, for the outdoor cultivation at its Port Perry Facility.

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