What’s the Key for Renewed Momo in Green Thumb Industries Inc (OTCMKTS:GTBIF)?

What’s the Key for Renewed Momo in Green Thumb Industries Inc (OTCMKTS:GTBIF)?


Green Thumb Industries Inc (OTCMKTS:GTBIF) just reported its financial results for Q3, in which revenues increased 344% year-over-year to $17.2 million, quarter-over-quarter revenues increased 26%, EBITDA1 came in at $3.4 million for the quarter, adjusted EBITDA dropped at $0.4 million, net loss came in at $3.3 million, current assets totaled $166.2 million as of September 30, 2018, including cash and cash equivalents of $149.8 million. Shares haven’t responded well to the data despite upbeat commentary from management. It will be awfully interesting to see where this lands next week.

In addition, the company has approximately $7.6 million of total debt, $1.5 million of which is due within 12 months. The company raised gross proceeds of $140.5 million through two bought deal financings, one subsequent to quarter end.

Green Thumb Industries Inc (OTCMKTS:GTBIF) bills itself as a company that manufactures and sells various cannabis products in the United States. The company’s cannabis products include flower, concentrates for dabbing and vaporizing, edibles, and topicals.

The company markets its products through third-party retailers. It also owns and operates a chain of 50 retail stores under the RISE dispensaries name. The company was founded in 2014 and is headquartered in Chicago, Illinois.

According to company materials, “Green Thumb Industries (GTI), a national cannabis cultivator, processor and dispensary operator, is dedicated to providing dignified access to safe and effective cannabis nationwide while giving back to the communities in which they serve. As a vertically integrated company, GTI manufactures and sells a well-rounded suite of branded cannabis products including flower, concentrates, edibles, and topicals. The company also owns and operates a rapidly growing national chain of retail cannabis stores called RISE(TM) dispensaries. Headquartered in Chicago, Illinois, GTI has seven manufacturing facilities and licenses for 50 retail locations across seven highly regulated U.S. markets. Established in 2014, GTI employs more than 350 people and serves hundreds of thousands of patients and customers each year. GTI was named a Best Workplace 2018 by Crain’s Chicago Business.”

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“This was another quarter of solid financial and operational results as we build our foundation for the future. We have been focused on expanding wholesale capacity to meet increasing demand, opening new RISE stores and are unwavering in our diligent effort building a world-class team. To support our strong retail pipeline, we added experts to the team in retail operations, real estate, design and construction, and marketing and communications from retail giants such as Nordstrom, Starbucks, Home Depot, Whole Foods, Apple and Nike. We are excited about what’s ahead for RISE as we accelerate the growth of this exceptional business,” said GTI Founder and Chief Executive Officer Ben Kovler.

Traders will note just shy of -10% stripped out of share values of the listing over the past week of action. What’s more, the listing has witnessed a pop in interest, as transaction volume levels have recently pushed 11% beyond what we have been seeing over the larger time frame.

It pays to take note of this fact given the stock’s tight trading float of about 22M shares. One is wise to respect the dynamic this may create — a jump in average daily transaction volume in a stock with a restricted float can unleash fireworks as supply is squeezed.

“We closed on the acquisition of KSGNF to operate in Florida, closed on the acquisition of an extraordinary retail asset in Boston, and are on track to more than double our footprint in the only limited license adult use market in the country with the strategic acquisition of Nevada’s top operator, Integral Associates, announced earlier this month,” Kovler continued. “All are important milestones as we position the business for long-term success by distributing brands at scale.”

Currently trading at a market capitalization of $1.51B, GTBIF has about $112M in cash on the books, which stands against about $9.3M in total current liabilities. The company has pulled in about $14M in revenues on a TTM basis. 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 $GTBIF 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 $GTBIF, either long or short, and we have not been compensated for this article.

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