The Epic Rise of Kush Bottles Inc (OTCMKTS:KSHB)

The Epic Rise of Kush Bottles Inc (OTCMKTS:KSHB)


Kush Bottles Inc (OTCMKTS:KSHB) has been on fire of late. This is a stock we have liked quite a bit for its consistent financial performance despite a potentially commoditizable business model. As we head into a new set of financial data, investors are flying into this very small float name, which has ignited a monster squeeze, driving shares up over 100% higher in just the past couple weeks. So, it’s interesting to see some new changes at the top amid the company’s recent run of success.

Specifically, the company just announced that Ben Wu, who has served as Chief Operating Officer since 2014, will step down effective today, January 12th, 2018. According to the company’s release, “Mr. Wu will continue to support the Company as an independent consultant for a minimum of six months focusing his efforts towards ongoing projects. As a result, Mr. Jim McCormick will assume the role of Chief Operating Officer in addition to continuing to serve in his current capacity as Chief Financial Officer.”

Kush Bottles Inc (OTCMKTS:KSHB) provides packaging products and solutions to producers, processors, and retailers operating in the regulated medical and recreational cannabis industry.

KSHB sells primarily into the b2b market, which includes legally operating medical and adult-use dispensaries, growers, and MIP producers (Marijuana Infused Products) in states with marijuana programs.

It offers pop top bottles; child resistant exit, paper exit, and foil barrier bags; tubes; and polystyrene, polypropylene, or silicone containers to urban farmers, greenhouse growers, and medical and recreational cannabis dispensaries.

According to the company’s press messaging, “Founded in 2010, Kush Bottles has sold more than 100 million bottles and regularly services thousands of customers across the United States and Canada. The company primarily services the B2B market, which includes legally operated medical and adult-use dispensaries, growers and marijuana-infused product manufacturers. Kush Bottles aims to be the gold standard for responsible branding and packaging in the cannabis industry.”

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As noted above, the stock has been on fire of late, which is why it comes as somewhat of a surprise to see changes at the top announced by the company. However, importantly for shareholders, there does not seem to be any animosity accompanying the transition.

“I would like to thank Ben for all his contributions to Kush Bottles, which have helped to grow the Company into the cannabis industry’s leading supplier of packaging, supplies and other ancillary products, and I wish him all the best for the future,” commented Nicholas Kovacevich, Chief Executive Officer of Kush Bottles. “Jim is more than qualified to take over the COO responsibilities having previously been general manager leading multi-market operations in the tobacco industry.  He has made a significant positive impact on the organization during his short tenure with the Company leveraging his experience and business acumen.  As we enter 2018, we look forward to leveraging this platform and continuing to build shareholder value.”

We’ve witnessed above 120% added to share values of the listing over the past month of action. Market participants may want to pay attention to this stock. KSHB is a stock with a past that has featured a litany of sudden rips to the upside. Furthermore, the stock has seen interest climb, with an increase in recent trading volume of 340% beyond its prior sustained average level.

This should not be overlooked given the stock’s extremely small trading float of 9.7M shares. Traders should not overlook this combination, as a restricted trading float and a jump in trading volume can crimp supply and push share prices higher.

Currently trading at a market capitalization of $393M, KSHB has a stash ($917K) of cash on the books, which compares with about $689K in total current liabilities. One should also note that debt has been growing over recent quarters. KSHB is pulling in trailing 12-month revenues of $18.8M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 263.8%. This may be a very interesting story and we will look forward to updating it again soon. Sign-up for continuing coverage on shares of $KSHB 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 $KSHB, either long or short, and we have not been compensated for this article.

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