Lo and behold, shares of Acreage Holdings Inc (OTCMKTS:ACRGF) may finally be showing some signs of a potential pivot into bounce mode. This has been one of the most stubborn plays in the cannabis patch as far as persisting in downtrend mode even after many other related stocks moved into some sort of upside action days – or in some cases, even weeks – ago. But last week’s close injects some hope into the chart, and this week’s action should be interesting.
To add some color to the story, the company just announced the closing of a series of sale-and-leaseback transactions for the sale of certain properties and facilities from Acreage Holdings to GreenAcreage for an aggregate of approximately $18 million to Acreage Holdings and approximately $23 million overall including payments to a third-party seller. According to the release, the locations funded and closed today include facilities in Massachusetts, Florida, and Pennsylvania. Acreage Holdings and GreenAcreage expect to close on additional facilities in Illinois and Connecticut within the next thirty days.
Acreage Holdings Inc (OTCMKTS:ACRGF) bills itself as a principal investment firm specializing in the cannabis industry.
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 the closing of a series of sale-and-leaseback transactions for the sale of certain properties and facilities from Acreage Holdings to GreenAcreage for an aggregate of approximately $18 million to Acreage Holdings and approximately $23 million overall including payments to a third-party seller.
“Acreage Holdings took a long, hard look at our portfolio of real estate holdings and made a strategic decision to rationalize our business strategy. We are in the business of bringing to market the best cannabis products possible and making them accessible to as wide an audience of patients and adult-use consumers as is viable. Acreage Holdings never intended to be a real estate company, and as the cannabis industry is a capital intensive business, tying up capital that can be deployed elsewhere is not in our shareholders’ best interest. By working closely with GreenAcreage, we will be able to focus on our core competencies, growing the plant, processing it into consumer/medical products and building out a network of retail locations across the country,” said Glen Leibowitz, Chief Financial Officer of Acreage Holdings.
“The proceeds generated from our relationship with GreenAcreage will be utilized to create long-term shareholder value through the buildout of our existing footprint or in our acquisition efforts to further expand our footprint. This is just one tool in our box we are utilizing to access efficient capital, with an eye toward building a leading U.S. cannabis operation.”
Now commanding a market cap of $403M, ACRGF has a significant war chest ($84.6M) of cash on the books, which is balanced by about $20.5M in total current liabilities. ACRGF is pulling in trailing 12-month revenues of $46.6M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 501.3%. 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 $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.