Hemp Inc (OTCMKTS:HEMP) has been beaten up in recent days following a sharp run higher to close out 2017. The move lines up with the pullback in the general cannabis space following the announcement by US Attorney General Jeff Sessions that the Cole Memo was set to be rescinded, making it ostensibly more difficult for states to legalize marijuana independent of the Federal Government. However, as we have noted repeatedly, this is not a marijuana stock, a fact about which the company is suddenly quite vociferous.
In addition, HEMP just announced that “Sessions’ stance on cannabis does NOT include industrial hemp and it definitely does NOT include kenaf, says Bruce Perlowin, CEO of Hemp, Inc. With 18,000,000 pounds of kenaf in inventory and another, approximate, 2,000,000 pounds of kenaf to be harvested early this year, Hemp, Inc. executives are not the least bit worried about their supply chain or if there will be any marijuana pushback by the federal government.”
Hemp Inc (OTCMKTS:HEMP) was founded in 2008. The company has a reputation as one of the more controversial enterprises, even by the standards of either the OTC or the cannabis patch, which certainly paints a picture.
In any case, the company is making strong strides toward reshaping its image as a legitimate emerging leadership play in the industrial hemp space.
Hemp Inc understands its mission to be a provider of “green solutions that help make the world a better place to live. We support products that are eco-friendly, organic, healthy and solutions that replace many petroleum-based products.”
“Hemp Inc.’s wholly owned subsidiary Industrial Hemp Manufacturing, LLC purchased the largest decortication plant in North America, which is located in Spring Hope, North Carolina. The plant is housed in a 70,000,000 square foot warehouse on 9 acres. The company will start producing fiber, loss circulation materials (LCM) and absorbents from kenaf and later from hemp.”
That narrative continues forward to include the concept that “Hemp, Inc. will produce a product for drilling rigs called “lost circulation material” (LCM), which is used for maintaining the seals when drilling for water, oil, gas, and any other liquid or gas. This product alone is capable of producing millions of dollars in revenue since some of the largest oil companies in the world will be our primary customers.”
“Eventually, the company will produce fiber materials for the paper and fabric industries, and other industries that utilize materials from hemp to make products such as plastics, building materials, health and beauty related products and more.” In other words, the concept of “diversified applications for hemp as an industrial material” is the paramount idea.
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As noted above, shares of the stock have been all over the place in recent days, ripping higher and then whipping back lower, and perhaps now trying to bounce back again. It’s difficult to pin down the precise causality behind the action, as is often the case with this stock. But the concept of a kibosh on this company’s operations based on uncertainty about US legislative direction with regard to marijuana is likely unfounded.
This company has justifiably reminded investors that industrial hemp is not pot. And it seems far-fetched to suggest that Hemp’s progress on the legislative side will be derailed by a more assertive US Federal government marijuana agenda.
“Investors in Hemp, Inc. have nothing to worry about or fear,” says Perlowin. Hemp, Inc., as reported in a press release yesterday, is processing its first two purchase orders. a truckload of kenaf fiber and a truckload of its kenaf loss circulation material (LCM). “This was not two truckloads of recreational marijuana. This was not two truckloads of medical marijuana. This was not even two truckloads of industrial hemp. It was one truckload of kenaf LCMs that’s going to Texas and one truckload of kenaf fiber that’s going to New Jersey. So no matter how Sessions marijuana obsession plays out, Hemp, Inc. is a safe bet for anyone concerned or hesitant about this new development,” said Perlowin.
Currently trading at a market capitalization of $25.1M, HEMP has about $258K in cash on the books, which stands against roughly $6.2 million in liabilities. The company has pulled in $55k in TTM revenues. We will update the story again soon as further details emerge. Sign-up for continuing coverage on shares of $HEMP stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $HEMP, either long or short, and we have not been compensated for this article.