Canopy Growth Corp (OTCMKTS:TWMJF) continues to battle against middling sentiment in the Canadian cannabis space, with valuation concerns mounting and the potential for product pricing limitations looming in the quarters ahead. But shares continue to respond well, holding on to the lions share of gains in the stock’s huge uptrend over the past 12 months. The company is a clear leader in the space, with nearly $240 million in cash on hand, and a number of new initiatives in play to spur further growth on the top line.
As a case in point, the company just announced a strategic agreement with LiveWell Foods Canada Inc. to accelerate the development and commercialization of Livewell’s two large-scale cannabis projects located in Ottawa, ON and Pontiac, QC, which collectively represent over 1,500,000 sq. ft. of future cannabis production and processing infrastructure. “This new partnership represents further validation that Canopy is the platform of choice in the cannabis sector,” said Bruce Linton, Chairman and CEO of Canopy Growth. “Canopy has an unmatched ability to collaborate with partners given our breadth of operational knowledge, technology, investment capital, and cultivation expertise.”
Canopy Growth Corp (OTCMKTS:TWMJF) is one of the bigger growers in the industry. The company produces and sells medical marijuana in Canada. It offers dry cannabis and oil products primarily under the Tweed and Bedrocan brands. It also sells its products through online.
According to company materials, “Tweed is the most recognized marijuana production brand in the world. It has built a large and loyal following by focusing on quality products and meaningful customer relationships. Tweed doesn’t just sell marijuana, it facilitates a conversation about a product we’ve all heard about but haven’t met intimately yet. It is approachable and friendly, yet reliable and trusted. As marijuana laws liberalize around the world, Tweed will expand its leading Canadian position around the globe.”
Also from their materials, “Bedrocan is the epitome of medical-grade cannabis. Bedrocan BV pioneered medical cannabis in Holland through decades of selection and refinement, leading to standardized, whole bud cannabis strains that patients can rely on. Bedrocan Canada supplies the same standardized strains to the Canadian market through exclusive licensing rights to the American continents, an arrangement it will also enjoy for all future genetic advancements. Due to its consistency over time, Bedrocan’s strains have been used in clinical research in seven European countries. That commitment to research didn’t stay on the east side of the Atlantic – Bedrocan Canada recently launched one of the largest clinical cannabis studies in the world, the EQUAL Study, to evaluate quality of life before and after medical cannabis use.”
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“Rivers continues to look for synergistic and mutually beneficial opportunities to support emerging industry players with strategic advisory services and financial support,” said Sean McNulty, Co-founder, Canopy Rivers. “We will work collaboratively with Canopy Growth to accelerate LiveWell’s speed to market and deploy the resulting offtake throughout Canopy’s industry-leading distribution platforms. With their Ottawa project located less than an hour from Canopy Growth’s Smith Falls headquarters, and 5 minutes from the airport, Livewell, once developed, represents a complementary supplement to our portfolio of production and distribution partners.”
“Partnering with Canopy Growth and Canopy Rivers, the leaders in the cannabis industry, provides LiveWell with the best in class partners required to execute on our ambitious growth plans in an efficient and expedited manner,” said LiveWell’s CEO Seann Poli. “Having access to their operational excellence, unique technology, global distribution infrastructure, and an abundance of other industry insights, we can significantly de-risk the execution and operation at both facilities. These significant executional efficiencies will drastically reduce our time to market and improve the quality of product we deliver.”
Now commanding a market cap of $2.27B, TWMJF has a significant war chest ($238.4M) of cash on the books, which must be weighed relative to about $1.5M in total current liabilities. TWMJF is pulling in trailing 12-month revenues of $69.8M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 122.5%. You can bet we will update this one again as new information comes into view. Sign-up for continuing coverage on shares of $TWMJF 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 $TWMJF, either long or short, and we have not been compensated for this article.