Why We Think OrganiGram Holdings Inc (OTCMKTS:OGRMF) is Such a Big Deal

Why We Think OrganiGram Holdings Inc (OTCMKTS:OGRMF) is Such a Big Deal


If you read back over our archives, you will find that our favorite Canadian cannabis producer play over the past 18 months has been OrganiGram Holdings Inc (OTCMKTS:OGRMF). The value proposition here is more compelling because the stock has less fanfare and therefore less stretched valuations. For example, we just saw these guys release the announcement that the company has signed a letter of intent with the Société québécoise du cannabis (SQDC), granting it agreements with all of the provinces.

According to the release, “this agreement solidifies the Company’s position as a true national player in Canada’s legal adult use recreational cannabis marketplace. Organigram now has distribution in place for all ten Canadian provinces. Based on currently available public information, this agreement makes Organigram one of only three licensed producers (“LPs”) in Canada along with Canopy Growth Corporation (TSX:WEED, NYSE:CGC) and Aphria (TSX: APHA and NYSE: APHA) to have secured distribution agreements with every province.”

OrganiGram Holdings Inc (OTCMKTS:OGRMF) casts itself as a company that produces and sells medical marijuana to individuals and physicians in Canada. It offers marijuana plants, seeds, and cuttings; cannabis oil; and dried flower and cannabis.

The company sells its products through phone and online store. It also operates healing centers that offer treatments for post-traumatic stress disorders, chronic pain, and trauma therapy. In addition, the company exports its products.

OrganiGram Holdings Inc. was founded in 2013 and is based in Moncton, Canada.

Moreover, OrganiGram Holdings Inc. is a TSX Venture Exchange listed company whose wholly owned subsidiary, OrganiGram Inc., is a licensed producer of medical marijuana in Canada. OrganiGram is focused on producing the highest quality, condition-specific medical marijuana for patients in Canada.

OGRMF’s facility is located in Moncton, New Brunswick and the Company is regulated by the Access to Cannabis for Medical Purposes Regulations.

According to company materials, “From the day we started back in 2013, it’s been about making lives better – for our clients, our people, and our community. We’re based in Moncton, New Brunswick, the heart of the Maritimes, but at OrganiGram Holdings we’re committed to improving the quality of life for Canadians across the country. For us, this means working with health-care providers and industry organizations, supporting research and education, and providing a safe, effective product. To be effective in that last goal, we made a decision to produce organic cannabis. Growing certified organic medical cannabis isn’t easy, in fact, most licensed producers won’t take this on. It means more care, more testing, more rules… but in the end, it means a product that we feel delivers on our goals in the best way. And improving the quality of life for Canadians is not just about getting safe, quality product to them effectively. It’s about creating jobs, being good neighbors and contributing to our community.”

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As noted above, OGRMF just announced that the company has signed a letter of intent with the Société québécoise du cannabis (SQDC), granting it agreements with all of the provinces.

Recent action has seen 14% added to share values of the listing over the past month of action. Furthermore, the stock has witnessed a pop in interest, as transaction volume levels have recently pushed 60% beyond what we have been seeing over the larger time frame.

“We are pleased to work with the SQDC and deliver products that will be needed to meet the demand of its customers,” says Tim Emberg, Senior Vice President of Sales and Commercial Operations, Organigram.

Earning a current market cap value of $831.29M, OGRMF has a significant war chest ($95.9M) of cash on the books, which compares with about $15.8M in total current liabilities. One should also note that debt has been growing over recent quarters. OGRMF is pulling in trailing 12-month revenues of $23.1M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 363%. This is an exciting story, and we look forward to a follow-up chapter as events transpire. Sign-up for continuing coverage on shares of $OGRMF 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 $OGRMF, either long or short, and we have not been compensated for this article.

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