Shares of Supreme Cannabis Company Inc (OTCMKTS:SPRWF) exploded higher to close out last week with a major breakout above the stock’s 50-day simple moving average on huge volume. The move takes the stock back above the critical $1.25/share level for the first time since June on a closing basis and suggests the possibility that the longer-term bullish trend is reasserting itself.
To help fuel the action, the company just announced that its wholly-owned subsidiary, 7ACRES, has entered into a supply agreement with the Ontario Cannabis Store to supply cannabis for online sales when the recreational market launches on October 17, 2018. According to the release, “Under the agreement, 7ACRES will also supply recreational cannabis to Ontario’s private retailers when the retail framework is approved and implemented by the Province.”
Supreme Cannabis Company Inc (OTCMKTS: SPRWF) trumpets itself as a Canadian publicly traded company committed to providing premium brands and products that proudly reflect its consumers, people, and uniquely innovative culture. The Company’s portfolio includes its wholly-owned subsidiary and flagship brand 7ACRES.
7ACRES is a federally licensed producer of medical cannabis operating inside a 342,000-square-foot facility in Kincardine, Ontario. 7ACRES is dedicated to providing consumers with a premium-quality product that recognizes its customers are informed, discerning and value a brand and culture that aligns with their principles. 7ACRES brand success has been reflected in provincial supply agreements, where 7ACRES’ product is consistently listed in the highest brand category available to recreational consumers.
The Company’s growing portfolio also includes an equity investment and long-term global distribution partnership with Lesotho-based Medigrow for the exporting of medical-grade cannabis oil.
The Supreme Cannabis Company has consistently set the standard for innovation in the sector, including the design of growing facilities and development of operational excellence metrics. We are confident that together with our flagship brand, proprietary technology and products, truly unique culture, and industry-leading team, we will deliver our shareholders consistent long-term value creation.
According to company materials, the company focuses on the production and sale of medical marijuana in Canada. The company was formerly known as Supreme Resources Ltd. and changed its name to Supreme Pharmaceuticals Inc. in February 2014. Supreme Pharmaceuticals Inc. was incorporated in 1979 and is headquartered in Vancouver, Canada.
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As noted above, the stock took flight on Friday of last week in a major technical breakout inspired by strength in the overall cannabis space as well as the company’s recent announcement that its wholly owned subsidiary, 7ACRES, has entered into a supply agreement with the Ontario Cannabis Store.
The chart shows 21% added to share values of the stock over the past week of action, a rally that has pushed up against longer standing distributive pressure in the stock. In addition, the company has witnessed a pop in interest, as transaction volume levels have recently pushed above 150% above its longer-run average levels.
“With Ontario expected to be the largest recreational cannabis market in the nation, this supply agreement is a major milestone for our Company,” said John Fowler, CEO of Supreme Cannabis. “We anticipate the full 7ACRES lineup will be placed in the premium category by the OCS validating the quality of our product offerings and our strategy of catering to discerning cannabis enthusiasts who, by the Ontario government’s own estimation, will drive the majority of recreational sales.”
Now commanding a market cap of $335.15M, SPRWF has a significant war chest ($78.5M) of cash on the books, which stands against virtually no total current liabilities. SPRWF is pulling in trailing 12-month revenues of $5.3M. In addition, the company is seeing recent top-line growth, with sequential quarterly revenues growing at 23.1%. We will update the story again soon as further details emerge. Sign-up for continuing coverage on shares of $SPRWF 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 $SPRWF, either long or short, and we have not been compensated for this article.