Developing a Theory to Understand the Performance of Medical Marijuana Inc (OTCMKTS:MJNA)

Developing a Theory to Understand the Performance of Medical Marijuana Inc (OTCMKTS:MJNA)


In the lexicon of quantum physics, the future reality of the cannabis market writ into equities, Medical Marijuana Inc (OTCMKTS:MJNA) remains a mystery. The spectrum of probabilities appears to powerfully favor the manifestation of a juggernaut in terms of growth and shareholder returns for the cannabis space at large. And yet, MJNA shares continue to struggle despite a series of record revenue months for the company.

As a case in point, the company just announced that both the Company, and its subsidiaries Kannaway and HempMeds Mexico, have booked their largest-ever (unaudited) sales in their history in June of 2018, as well as reached major milestones in business operations. “We are pleased to announce June of 2018 was the largest month in the history of our Company,” said Medical Marijuana, Inc. CEO Dr. Stuart Titus. “We’re looking forward to our expansion into Canada’s emerging cannabis market and to building upon our success in July.”

Medical Marijuana Inc (OTCMKTS:MJNA) casts itself as an investment holding company that operates in the medical marijuana and industrial hemp markets. Its products range from patented and proprietary based cannabinoid products to seed and stalk or isolated high-value extracts manufactured and formulated for the pharmaceutical, nutraceutical, and cosmeceutical industries.

MJNA’s subsidiary, Kannaway, LLC, is a network sales and marketing company specializing in the sales and marketing of hemp-based botanical products. Kannaway currently hosts weekly online sales meetings and conferences across the United States, offering unique insight and opportunity to sales professionals who are desirous of becoming successful leaders in the sale and marketing of hemp-based botanical products

MJNA licenses its proprietary testing, genetics, labeling and packaging, tracking, production, and standardization methods for the medicinal cannabinoid industry. It engages in the research and development of cannabinoid-based pharmaceuticals; and marketing and distribution of cannabidiol hemp oil-based products.

In addition, MJNA provides management support and services to cooperatives, collectives, health and wellness facilities, and medical clinics; and consulting and securities services to businesses and individuals in the legal cannabis industry. Further, it focuses on the treatment of pain and other medical disorders with the application of chewing gum-based cannabis/cannabinoid medical products, sportswear and more.”

According to company materials, “Our mission is to be the premier cannabis and hemp industry innovators, leveraging our team of professionals to source, evaluate and purchase value-added companies and products while allowing them to keep their integrity and entrepreneurial spirit. We strive to create awareness within our industry, develop environmentally-friendly, economically sustainable businesses, while increasing shareholder value.”

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As noted above, while MJNA continues to apparently put up the big numbers, for some reason, the stock continues to fail to represent that growth path on the chart. In fact, we’ve witnessed slightly lower action for share pricing for the name in the past week. And this mirrors the performance we have seen over the past few months, despite a run in the cannabis space at large as we approach an inevitable full-scale legalization in Canada in October.

“This achievement proves Medical Marijuana, Inc. and its subsidiaries will continue to be leaders in the industry,” said Medical Marijuana, Inc. COO Blake Schroeder. “This month was historic for the Company and we believe 2018 will continue to be a banner year for the Company.”

If we were to take a shot at understanding the mismatch here, one might think it lies in the use of that stigmatic word “unaudited”, which seems perhaps somewhat out of place for a company pulling in over $33M on a trailing twelve month basis.

Currently trading at a market capitalization of $313.5M, MJNA has a significant war chest ($4M) of cash on the books, which stands against virtually no total current liabilities. MJNA is pulling in trailing 12-month revenues of $33.4M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 191.6%. As more color becomes clear on the name, we will review the situation and update our take. Sign-up for continuing coverage on shares of $MJNA 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 $MJNA, either long or short, and we have not been compensated for this article.

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