Why Hexo Corp (OTCMKTS:HYYDF) Has Been So Resilient

Why Hexo Corp (OTCMKTS:HYYDF) Has Been So Resilient

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One stock that has managed to hold up against the tide of negative sentiment that characterizes the investment landscape for the cannabis space in November is certainly Hexo Corp (OTCMKTS:HYYDF). Shares continue to represent one of the very few plays in the space to maintain ground above the 200-day moving average. To further that cause, the company just announced that it was honored for product innovation with two prestigious Canadian Cannabis Awards at the 2018 gala.

According to the release, Hydropothecary by HEXO took home Cannabis Product of the Year and Innovation of the Year for Elixir. Canada’s first and only peppermint medical cannabis oil sublingual spray, Elixir, is an easy-to-use, discreet and convenient smoke-free method to consume cannabis.

Hexo Corp (OTCMKTS:HYYDF) trumpets itself as a company that, together with its subsidiaries, produces and distributes medical marijuana products. The company is headquartered in Gatineau, Canada, and, as noted above, just changed its corporate name from “The Hydropothecary Corporation” to “HEXO Corp.” effective August 29, 2018.

HEXO creates and distributes innovative, easy-to-use and easy-to-understand products to serve the Canadian cannabis market. One of the country’s lowest-cost producers, HEXO is rapidly increasing its production capacity in the lead up to the adult-use cannabis market.

The Company currently operates with over 310,000 sq. ft. of production capacity with construction on another 1,000,000 sq. ft. expansion set to be complete by year-end. HEXO will serve the adult-use market under the HEXO brand, while continuing to serve its medical cannabis clients through the well-known Hydropothecary brand.

According to company materials, “HEXO Corp. creates and distributes innovative, easy-to-use and easy-to-understand products to serve the Canadian cannabis market. One of the country’s lowest-cost producers, HEXO is rapidly increasing its production capacity in the lead up to the adult-use cannabis market. The Company currently operates with over 310,000 sq. ft. of production capacity with construction on another 1,000,000 sq. ft. expansion set to be complete by year-end. HEXO will serve the adult-use market under the HEXO brand, while continuing to serve its medical cannabis clients through the well-known Hydropothecary brand.“

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As noted above, HYYDF just announced that it was honored for product innovation with two prestigious Canadian Cannabis Awards at the 2018 gala. In all, recent action has seen 0% piled on for shareholders of the company during the trailing week. Moreover, the stock has seen interest climb, with an increase in recent trading volume of 16% beyond what we have been seeing over the larger time frame.

“We are honored to be here and to accept these awards on behalf of the entire HEXO team,” said HEXO’s co-founder and CBO Adam Miron.

“This is an exciting time for HEXO and we have set aggressive goals to continue leading the charge in branding and product innovation. Awards like this are recognition that we are on the right path and continuing to meet our customers’ expectations. Stay curious!”

Now commanding a market cap of $836.42M, HYYDF has a significant war chest ($244.8M) of cash on the books, which must be weighed relative to about $12.1M in total current liabilities. One should also note that debt has been growing over recent quarters. HYYDF is pulling in trailing 12-month revenues of $4.9M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 63.7%. We will update the story again soon as further details emerge. Sign-up for continuing coverage on shares of $HYYDF 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 $HYYDF, either long or short, and we have not been compensated for this article.

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