One stock we turned bearish on over the past two months was Hemp Inc (OTCMKTS:HEMP). It got overpriced out of the signing of the 2018 Farm Bill. However, after a 50% decline, it may be time to give this one a fresh look. To paint a clearer picture, the company just announced a bill is being fast-tracked through the Arizona state legislature that will speed up the rollout of a hemp program.
According to the release, “Meanwhile, Hemp, Inc. is ramping up operations with its strategic growing partner Veteran Village Kins Community in Golden Valley, Arizona. Hemp, Inc. announced in July 2018 that the growing community was expanding its footprint.”
Hemp Inc (OTCMKTS:HEMP) was founded in 2008. The company has a reputation as one of the more controversial enterprises, even by the standards of either the OTC or the cannabis patch, which certainly paints a picture.
In any case, the company is making strong strides toward reshaping its image as a legitimate emerging leadership play in the industrial hemp space.
Hemp Inc understands its mission to be a provider of “green solutions that help make the world a better place to live. We support products that are eco-friendly, organic, healthy and solutions that replace many petroleum-based products.”
“Hemp Inc.’s wholly owned subsidiary Industrial Hemp Manufacturing, LLC purchased the largest decortication plant in North America, which is located in Spring Hope, North Carolina. The plant is housed in a 70,000,000 square foot warehouse on 9 acres. The company will start producing fiber, loss circulation materials (LCM) and absorbents from kenaf and later from hemp.”
That narrative continues forward to include the concept that “Hemp, Inc. will produce a product for drilling rigs called “lost circulation material” (LCM), which is used for maintaining the seals when drilling for water, oil, gas, and any other liquid or gas. This product alone is capable of producing millions of dollars in revenue since some of the largest oil companies in the world will be our primary customers.”
“Eventually, the company will produce fiber materials for the paper and fabric industries, and other industries that utilize materials from hemp to make products such as plastics, building materials, health, and beauty related products and more.” In other words, the concept of “diversified applications for hemp as an industrial material” is the paramount idea.
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As noted above, HEMP just announced a bill is being fast-tracked through the Arizona state legislature that will speed up the rollout of a hemp program.
The chart shows -6% stripped out of share pricing for the company in the past week. In addition, the listing has witnessed a pop in interest, as transaction volume levels have recently pushed 16% beyond its prior sustained average level.
“This is an exciting time for hemp and the state of Arizona, which is why we are continuing to make forward strides at the Arizona Veteran Village Kins Community, which includes preparing 80 acres for hemp growth as of today (a total of 300 of the 500 acres is already fenced in and will hopefully be prepped by the time planting starts in Arizona),” said Dwight Jory, the Project Manager for Veteran Village Kins Community Arizona, Inc. “We are currently in the process of completing two of the six geodesic domes to the property and are putting the finishing touches on security and our live feed video stream, which will be completed the first week in March.”
Earning a current market cap value of $19.98M, HEMP has a reserve ($1.4M) of cash on the books, which compares with about $1M in total current liabilities. One should also note that debt has been growing over recent quarters. HEMP is pulling in trailing 12-month revenues of $400K. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 248.3%. This may be a very interesting story and we will look forward to updating it again soon. Sign-up for continuing coverage on shares of $HEMP 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 $HEMP, either long or short, and we have not been compensated for this article.