For traders who love to play around in the Canadian cannabis patch on US OTC exchange tiers, take note of Green Organic Dutchman Holdings Ltd (OTCMKTS: TGODF), a player on the scene with nearly $130M in cash on the balance sheet and market cap just shy of a cool billion. Shares of the stock have been on the move, breaking out of an initial trading range, and picking up major momentum this week.
The action has been augmented by recent catalysts. As a case in point, the company just announced that it has entered into an exclusive agreement with Stillwater Brands to license RIPPLE SC (Soluble Cannabinoids) ingredient technology, and other proprietary beverage and food technologies and formulations related to cannabinoid-infused consumer packaged goods including micro-dose and full-dose tea sticks within Canada and certain international jurisdictions outside of the USA.
Green Organic Dutchman Holdings Ltd (OTCMKTS: TGODF) is a research & development company licensed under the Access to Cannabis for Medical Purposes Regulations (“ACMPR”) to cultivate medical cannabis. The Company carries out its principal activities producing cannabis from its facilities in Ancaster, Ont., pursuant to the provisions of the ACMPR and the Controlled Drugs and Substances Act (Canada) and its regulations.
The Company grows high quality, organic cannabis with sustainable, all-natural principles. TGOD’s products are laboratory tested to ensure patients have access to a standardized, safe and consistent product. TGOD has a funded capacity of 116,000 kg and is building 970,000 sq. ft. of cultivation facilities in Ontario and Quebec.
The Company has developed a strategic partnership with Aurora Cannabis Inc. (TSX:ACB) whereby Aurora has invested approximately C$78.1 million for an approximate 17.5% stake in TGOD. In addition, the Company has raised approximately C$290 million dollars and has over 5,000 shareholders. TGOD’s Common Shares and warrants issued under the indenture dated November 1, 2017 trade on the TSX under the symbol “TGOD” and “TGOD.WT”, respectively.
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Traders will note 40% piled on for shareholders of the listing during the trailing week. Moreover, the stock has registered increased average transaction volume recently. It pays to take note of this fact due to the very limited float size in the stock (of 29M shares). One is wise to respect the dynamic this may create — a mechanically driven price squeeze can result from this type of mix of small float and ramping attention from traders.
But, more importantly, the company’s recent deal accentuates the potential inherent in the soluble cannabinoid market. This move represents a clear expansion in the form of potential segmentation, which should provide the much-needed ingredient of diversification in revenue streams that we have seen as essential for these companies to start trading at wider multiples to sales.
“We believe that soluble cannabinoids and the consumer benefits they enable represent the future of functional foods,” said Justin Singer, CEO of Stillwater Brands. “TGOD’s emphasis on organic, high-quality consumer products makes the Company an ideal partner to carry our vision into the Canadian and international markets.”
“We are excited to have the opportunity to provide a platform to introduce Stillwater’s advanced technologies and formulations worldwide using TGOD’s premium organic ingredients,” said Rob Anderson, Co-Chairman and CEO of TGOD. “This technology will allow TGOD to provide patients and customers around the globe with novel and effective dose-controlled delivery systems that are safer, more standardized, and more discreet than most current cannabinoid delivery systems.”
Earning a current market cap value of $967M, TGODF has a significant war chest ($129.7M) of cash on the books, which compares with virtually no total current liabilities. The company is pre-revenue at this point. This is an exciting story, and we look forward to a follow-up chapter as events transpire. Sign-up for continuing coverage on shares of $TGODF 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 $TGODF, either long or short, and we have not been compensated for this article.