Why Medmen Enterprises Inc (OTCMKTS:MMNFF) May Still Have Big Things Ahead

Why Medmen Enterprises Inc (OTCMKTS:MMNFF) May Still Have Big Things Ahead

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A stock that is set for an extremely important test of its fortitude as a potential leading play in the cannabis space in the years to come this week is Medmen Enterprises Inc (OTCMKTS:MMNFF). The stock is particularly interesting because it has been sharply discounted by scandal but may still represent one of the most interesting growth plays for the US cannabis market. To make matters even more interesting, the company just announced the opening of its Sorrento Valley store in San Diego, California.

According to the release, “this is the second MedMen location in the San Diego area and the Company’s 11th operational MedMen location in California. With a population of 1.4 million people, San Diego is the second largest city in California and ranks as one of the world’s most visited tourist destinations, with an average of 36 million visitors annually1. Sorrento Valley is known as a center for high-tech, biotech and scientific research and the MedMen store is in close proximity to the University of California, San Diego campus, as well as the headquarters for several prominent companies. The dispensary is strategically located to serve the neighborhoods of Torrey Pines, La Jolla, Del Mar, Rancho Santa Fe, Mira Mesa and Solana Beach.”

Medmen Enterprises Inc (OTCMKTS:MMNFF) frames itself as a company that, together with its subsidiaries, operates in the cannabis space in the United States.

The company cultivates, produces, possesses, uses, and distributes/retails cannabis in the recreational and medicinal cannabis marketplace. As of June 6, 2018, it owned and operated 18 licensed cannabis facilities under the MedMen brand name in California, Nevada, and New York.

The company frames itself as “the preeminent cannabis company in the United States” with multiple assets and operations in California, Nevada, New York, and Florida. MedMen owns and operates licensed cannabis facilities in cultivation, manufacturing, and retail, and is one of the most well-recognized cannabis brands in the world today.

Headquartered in Los Angeles, MedMen employs more than 800 workers across the United States. It was founded in 2010 by Adam Bierman and Andrew Modlin, two visionary entrepreneurs who saw not just a tremendous business opportunity in the growing legalization of marijuana, but a chance to re-define our society’s relationship with cannabis. MedMen supports sensible, clear and just drug laws.

The Company is the single largest financial supporter of progressive marijuana laws at the local, state and federal levels, giving directly to pro-legalization groups, industry organizations and political candidates.

The company is headquartered in Culver City, California. MedMen Enterprises Inc. is a subsidiary of The Medmen Of Nevada 2 Llc.

According to company materials, “MedMen Enterprises is a leading cannabis company in the U.S. with assets and operations across the country. Based in Los Angeles, MedMen brings expertise and capital to the cannabis industry and is one of the nation’s largest financial supporters of progressive marijuana laws.”

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As noted above, MMNFF just announced the opening of its Sorrento Valley store in San Diego, California.

While this is a clear factor, it has been incorporated into a trading tape characterized by a pretty dominant offer, which hasn’t been the type of action MMNFF shareholders really want to see. In total, over the past five days, shares of the stock have dropped by roughly -4% on above average trading volume.

All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities. Furthermore, the stock has seen a growing influx of trading interest, with the stock’s recent average trading volume running 20% over the long run average.

According to the release, “the opening of MedMen Sorrento Valley continues the Company’s expansion within California, a potential $11 billion cannabis market, according to Cowen. The Company recently reported an approximate 7% market share2 and approximately $100 million in annualized sales within the state.”

Now commanding a market cap of $1.29B, MMNFF has about $12.2M in cash on the books, which must be weighed relative to a mountain of over $86M in total current liabilities. The company has been pulling in significant revenues, with over $7M in Q1 of this year, representing over 630% quarterly y/y growth on the top line. We will update the story again soon as developments transpire. Sign-up for continuing coverage on shares of $MMNFF 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 $MMNFF, either long or short, and we have not been compensated for this article.

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