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Thursday, October 29, 2020

Cannabis Science Inc (OTCMKTS:CBIS) Opens Up a New Door

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Cannabis Science Inc (OTCMKTS:CBIS) is a micro cap in the cannabis sector that has been banging along key support at the $0.06 level for the past 6 weeks. CBIS has a potential double bottom in place right now, but not a clean one given the higher low put in place in the second position, leaving unflushed stops below and weak hands still on board potentially to be “puked” out on a subsequent flush under the level.

That forms the context in which the company recently announced that it has received U.S. Federal Government clearance to receive U.S. Federal Government contracts. According to the release, “as the world’s largest customer, the U.S. Federal Government issues over $192 billion in contracts and over $450 billion in grants annually.” But that does not speak to the question of whether or not CBIS could possibly have any products, services, or relevant expertise that would qualify for any current projects being contracted out by the US Federal Government.

Cannabis Science Inc (OTCMKTS:CBIS) has been down an interesting road over recent months. We see the company as actively striving for, and achieving a bump in legitimacy through some of its newly established relationships. But shareholders may be nearing impatience before long in expectation of a ramp toward sales growth.

The company defines itself according to the narrative of a leading-edge researcher and designer of cannabinoid solutions to health problems.

CBIS is involved in developing medicines for autism, blood pressure, cancer and cancer side effects, as well as for other illnesses comprising for general health maintenance. It also develops CS-TATI-1 for newly diagnosed and treatment-experienced patients with drug-resistant HIV strains, as well as those intolerant of available therapies; CS-S/BCC-1 to treat basal and squamous cell carcinomas; and a proprietary cannabis-based therapy for neurological conditions.

Cannabis Science Inc also has collaboration with IGXBio, Inc. to develop GenePro, a DNA-based immunotherapeutic drug.

In addition, CBIS offers an online video-based medical cannabis education system, including courses, such as medical cannabis law, medical marijuana, cooking, horticulture, and bud tending; and manufactures and distributes specialty horse and pet grooming and topical applications. It has a license agreement with Apothecary Genetics Investments LLC to produce various brand formulations for California medical cannabis market.

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As noted above, Cannabis Science has completed its registration in the U.S. Government’s System for Award Management (SAM), and has applied for and received a Commercial and Government Entity (CAGE) Code from the Defense Logistics Agency’s CAGE Program Office at the U.S. Department of Defense.

The company’s recent press release notes that Cannabis Science is now listed with all U.S. companies eligible for Federal Government Contracts.

“Achieving eligibility to access contracting opportunities with the U.S. Federal Government is a significant step for Cannabis Science,” stated Mr. Raymond C. Dabney, Cannabis Science’s President, CEO, and Co-founder. “I believe we can leverage the unique experience and expertise of our company to win new business and grow Cannabis Science’s revenue base. We also plan to work closely with our strategic partners and collaborators to access Federal contracting and grant opportunities.”

Traders will note 6% during the past week in terms of shareholder gains in the listing, but that move comes in the context of a larger bearish trend. The situation may be worth watching. CBIS has evidenced sudden upward volatility on many prior occasions. What’s more, the company has seen interest climb, with an increase in recent trading volume of 19% over what the stock has registered over the longer term.

Earning a current market cap value of $153.4M, CBIS has a store ($333K) of cash on the books, which must be weighed relative to about $2M in total current liabilities. CBIS has posted negligible revenues in the past. As we noted recently, the balance sheet looms now given the company’s history of shareholder dilution over the years. We are curious to see how this story evolves from here. Also as we have noted, there’s no question that there’s potential here. But the company has been around long enough to start putting up real numbers. We’re ready to see it. As more color becomes clear on the name, we will review the situation and update our take. For continuing coverage on shares of $CBIS stock, as well as our other hot stock picks, sign up for our free newsletter today and get our next hot stock pick!

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