Shares of Sugarmade Inc (OTCMKTS:SGMD) have been exploding higher in recent action on huge volume. The momentum springs from the company’s announcement earlier this week of the finalization of terms between itself and BZRTH Inc. for a definitive agreement whereby Sugarmade will acquire BZRTH Inc., a leading ecommerce supplier to the rapidly expanding hydroponic agricultural space.
According to the release, “the Parties expect the acquisition to be finalized and closed by October 31, 2019. The acquisition will position Sugarmade to book all revenues from both entities, creating a combined entity that, based on most-recent financial estimates, stands to produce $37 million in annual sales and positive cash flow and EBITDA, resulting in Sugarmade becoming one of the largest publicly-traded companies in this fast-growing sector.”
Sugarmade Inc (OTCMKTS:SGMD) bills itself as a company that engages in the supply of hydroponic and cultivation products, and products to quick service restaurants. It supplies hydroponic and indoor/outdoor cultivation products to the agricultural market sectors, including the legal cannabis cultivation, processing, and distribution sectors.
The company also produces and wholesales custom printed and generic supplies, such as double poly paper cups for cold beverage; and disposable, clear, and plastic cold cups, and paper coffee cups, yogurt cups, ice cream cups, cup lids, cup sleeves, edible packaging, food containers, soup containers, plastic spoons, and other related products.
Sugarmade, Inc. was founded in 2009 and is headquartered in Monrovia, California.
According to company materials, “Sugarmade, Inc. (OTCQB: SGMD) is a product and branding marketing company investing in operations and technologies with disruptive potential. The Company is becoming a leading supplier to the growing hemp industry and is benefitting from the growth of the hydroponic marketplace. The Company is in the process of acquiring several leading hydroponic and agricultural supply companies that are currently producing in excess of $70 million in annual revenues. The Company also operates Carryoutsupplies.com, a leader provider to the quick service restaurant industry.”
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As noted above, SGMD just announced the finalization of terms between Sugarmade and BZRTH Inc. for a definitive agreement whereby Sugarmade will acquire BZRTH Inc., a leading ecommerce supplier to the rapidly expanding hydroponic agricultural space.
Recent action has seen 86% tacked on to share pricing for the company in the past week. What’s more, the company has benefitted from a jump in recent trading volume to the tune of exceeding 260% over what the stock has registered over the longer term.
“After months of negotiations, we now have robust terms set into place that represent enormous value for Sugarmade shareholders,” commented Jimmy Chan, CEO of Sugarmade. “This acquisition, in itself, will dramatically augment the Company’s top and bottom line numbers and massively expand our overall presence in the booming hydroponics and hemp ecommerce space. Further, it also represents the central piece of our overarching roll-up strategy to position Sugarmade as the dominant pick-and-shovel entity on the hydroponics side catering to producers in the explosive market for hemp and hemp-related crops in North America.”
Now commanding a market cap of $13M, SGMD is pulling in trailing 12-month revenues of $4.6M, which is slated to rise dramatically as this acquisition closes at the end of the month. Take note. As more color becomes clear on the name, we will review the situation and update our take. Sign-up for continuing coverage on shares of $SGMD 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 $SGMD, either long or short, and we have not been compensated for this article.