As we continue to chase down interesting stories and compelling technical configurations in the small and micro-cap space, Kush Bottles Inc (OTCMKTS:KSHB) occurs as a thoroughly relevant example at the moment. There are two important themes here: first, the stock very clearly just found strong-handed support just above its rising 200-day SMA, and second, the company is steamrolling toward a new earnings announcement with nearly 250% topline growth on the books at present. That suggests high expectations and a market signal of money flows into the stock right now.
In addition, the company just announced that it has launched new labeling, printing and in-house application capabilities that will shorten the turnaround time on production, eliminate the need for customers to work with multiple vendors and further reinforce The Companies commitment to being a fully integrated partner for clients. According to the release, “With the new capabilities, Kush Bottles will now have all its own equipment, tooling and materials necessary to process its customers’ customized packaging needs. The Company also announced that is has hired packaging industry veteran Mike Alejos as Director of Production to oversee the new labeling capabilities.”
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, “Kush Bottles, Inc. (OTCQB: KSHB) is a dynamic sales platform that provides unique products and services for both businesses and consumers in the cannabis industry. Founded in 2010 as a packaging and supplies company for dispensaries and growers, Kush Bottles has sold more than 100 million units and now regularly services more than 5,000 legally operated medical and adult-use dispensaries, growers, and producers across North America, South America, and Europe. The Company has facilities in the three largest U.S. cannabis markets and a local sales presence in every major U.S. cannabis market.”
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Recent action has seen 9% piled on for shareholders of the listing during the trailing week. In addition, the listing has seen interest climb, with an increase in recent trading volume of 12% over the long run average. This is particularly important due to the very limited float size in the stock (of 9.6 million shares).
“The addition of these advanced labeling capabilities speaks directly to the true ‘one-stop-shop’ nature of Kush Bottles,” said Nick Kovacevich, Kush Bottles’ Chief Executive Officer. “As we continue to diversify our offerings, we are adding value and economies of scale for our customer base. For example, we can now take what used to be a two-three-week turnaround time and reduce that by up to two-thirds. The more nimble we can be and the more we can take on for our customers, the quicker they can get their products to market.”
Earning a current market cap value of $295.3M, KSHB has a significant war chest ($7.1M) of cash on the books, which compares with about $1.1M in total current liabilities. KSHB is pulling in trailing 12-month revenues of $32.6M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 248.8%. 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 $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.