Recent Events Only Further Support the KushCo Holdings Inc (OTCMKTS:KSHB) Bull Thesis

Recent Events Only Further Support the KushCo Holdings Inc (OTCMKTS:KSHB) Bull Thesis

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At this point, given our overall thesis on KushCo Holdings Inc (OTCMKTS:KSHB), we continue to look favorably on the name. That sense has only increased in response to the news that the company has formed an exclusive partnership with JSP Portinox to facilitate the delivery of ultra-pure hydrocarbon gases and solvents in state-of-the-art stainless steel gas cylinders, through its Kush Energy division, which will debut at MJBizCon November 14-16, 2018 in Las Vegas, Nevada.

According to the release, Kush Energy provides ultra-pure hydrocarbon gases and solvents to the cannabis industry, which are essential in the extraction process for products including oils, edibles, and waxes. This investment in stainless-steel cylinders, which leave no residue and are significantly cleaner for the environment, delivers more effective hydrocarbons and solvents to KushCo’s customers which can impact the purity and profitability of a cannabis company’s product. Under the terms of the agreement with JSP Portinox, KushCo will have exclusivity on these specially designed stainless-steel cylinders.

KushCo Holdings Inc (OTCMKTS:KSHB) is the parent company to a diverse group of business units that are transformative leaders in the cannabis, CBD and other related industries. KushCo Holdings’ subsidiaries and brands provide exceptional customer service, product quality, compliance knowledge and a local presence in serving its diverse customer base.

KushCo Holdings’ brands include Kush Bottles, a dynamic sales platform that is the nation’s largest and most respected distributor of packaging, supplies, and accessories, Kush Energy, which provides ultra-pure hydrocarbon gases and solvents to the cannabis and CBD sector, Hybrid Creative, a premier creative design agency for cannabis and non-cannabis ventures, and Koleto Packaging Solutions, the research and development arm driving intellectual property development and acquisitions.

Founded in 2010, KushCo Holdings has now sold more than 1 billion units and regularly services more than 5,000 legally operated medical and adult-use dispensaries, growers, and producers across North America, South America, and Europe. KushCo Holdings subsidiaries maintain facilities in the five largest U.S. cannabis markets as well as having a local sales presence in every major U.S. cannabis market.

According to its materials, “KushCo Holdings, strives to be the industry leader for responsible and compliant products and services in the legal cannabis and CBD industry. The Company has been featured in media nationwide, including CNBC, Los Angeles Times, TheStreet.com, Entrepreneur, and business magazine Inc.  While KushCo Holdings services all facets of the cannabis and CBD industries, it has no direct involvement with the cannabis plant or any products that contain THC or CBD.”

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As noted above, KSHB just announced that it has formed an exclusive partnership with JSP Portinox to facilitate the delivery of ultra-pure hydrocarbon gases and solvents in state-of-the-art stainless steel gas cylinders, through its Kush Energy division, which will debut at MJBizCon November 14-16, 2018 in Las Vegas, Nevada.

The chart shows a stock fighting successfully right now to hold onto its 200-day moving average, but largely treading water over the past month. Furthermore, the name has registered increased average transaction volume recently, with the past month seeing 30% over what the stock has registered over the longer term.

Nick Kovacevich, Chief Executive Officer, commented, “Stainless steel tanks are the future for how hydrocarbons will be stored and transported. We’re proud and confident we are the first and only company to offer this premier solution to the cannabis market.  As a market leader, we pride ourselves on the ability to continue to push the boundaries of innovation and deliver more and more value to our client base.  We believe our new tanks will be superior to any existing tanks offered by competitors and traditional gas providers, and the butane we provide will be cleaner and more pure. And ultimately, we expect this to result in more sales to existing customers and future customers, significantly increasing our market share in this category.”

At this time, carrying a capital value in the market of $424.03M, KSHB has a significant war chest ($3.6M) of cash on the books, which stands against about $10.9M in total current liabilities. One should also note that debt has been growing over recent quarters. KSHB is pulling in trailing 12-month revenues of $40.8M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 173.4%. We will update the story again soon as further details emerge. 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.

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