What to Make of the Acreage Holdings Inc (OTCMKTS:ACRGF) Bounce?

What to Make of the Acreage Holdings Inc (OTCMKTS:ACRGF) Bounce?

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Shares of Acreage Holdings Inc (OTCMKTS:ACRGF) exploded higher on Friday to close out a tumultuous week. The stock may be worth watching this week given the resurgent posture we see in place here. Will it continue in the days ahead? To help flesh that out, it’s important to remember that the company just announced that it entered into an agreement to acquire 100% of California-based Kanna, Inc, which holds a license to operate a cannabis dispensary in Oakland, CA. According to the release, this marks the first dispensary operating license for Acreage in California.

The release also went on to note that “the dispensary is scheduled to open in the second quarter of 2019, under Acreage’s dispensary brand The Botanist. Oakland is a limited competition market allowing just 16 adult use dispensaries to serve a population of more than 400,000. Acreage will be fully integrated in a state that is estimated to generate $6.3 billion in legal cannabis sales by 2022, according to Arcview Market Research.”

Acreage Holdings Inc (OTCMKTS:ACRGF) bills itself as Acreage Holdings, formerly High Street Capital Partners, is a principal investment firm specializing in cannabis industry. Acreage Holdings was founded in 2014 and is based in New York, New York.

This is a vertically integrated, multi-state owner of cannabis licenses and assets in U.S. states where either medical and/or adult use of cannabis is legal. With one of the largest geographic footprints of any cannabis companies, it currently owns and/or operates cultivation, processing and dispensary operations. The Company is dedicated to building and scaling operations to create a seamless, consumer-focused branded cannabis experience.

According to public filings, Acreage is the largest multi-state cannabis operator in the United States in terms of number of states with operating licenses, largest total addressable market, and largest serviceable population.  More recently, Acreage announced a transformative acquisition of Form Factory, which will provide the company with the capabilities to become the cannabis industry’s first and only Consumer Packaged Goods company with a national footprint.

Headquartered in New York City, Acreage Holdings is the largest vertically integrated, multi-state owner of cannabis licenses and assets in U.S. states with respect to number of states with operating licenses, according to public filings.

With operating licenses in 19 states, serving a population of more than 172 million Americans, and an estimated 2022 total addressable market of approximately $14 billion in legal cannabis sales according to Arcview Market Research.  Acreage is dedicated to building and scaling operations to create a seamless, consumer-focused branded cannabis experience.

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As noted above, ACRGF just announced that it entered into an agreement to acquire 100% of California-based Kanna, Inc, which holds a license to operate a cannabis dispensary in Oakland, CA.

We’ve witnessed 14% during the past week in terms of shareholder gains in the stock. Moreover, the company has witnessed a pop in interest, as transaction volume levels have recently pushed above 150% above the average volume levels in play in this stock over the longer term. Traders should note this as important with the stock trading on a float that is limited at just 22.5M shares.

“I could not be more excited about our first dispensary operation in California, especially one in a limited competitive market. While this is our first, it is nowhere near our last, as we expect to significantly expand our dispensary footprint in the state over the coming months,” said Kevin Murphy, Founder, Chairman, and Chief Executive Officer of Acreage Holdings, Inc.

At this time, carrying a capital value in the market of $2.14B, ACRGF has a significant war chest ($74.2M) of cash on the books, which stands against about $69.9M in total current liabilities. One should also note that debt has been growing over recent quarters. ACRGF is pulling in trailing 12-month revenues of $12.8M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 160%. We will update the story again as soon as developments transpire. Sign-up for continuing coverage on shares of $ACRGF 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 $ACRGF, either long or short, and we have not been compensated for this article.

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