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Saturday, November 28, 2020

Medmen Enterprises Inc (OTCMKTS:MMNFF) Faces its Next Key Test

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The troubled times could be set to continue for shares of Medmen Enterprises Inc (OTCMKTS:MMNFF). Despite another quarterly report featuring seemingly strong results, shares of the stock are poised for some sort of test of the waters below the key $1/share mark based on technical pattern analysis. The company just announced financials for the quarter ended June 29 across MedMen’s operations in California, Nevada, New York, Illinois and Arizona, reporting revenues increased to $42.0 million, up 15% sequentially and 104% year-over-year.

“Fiscal 2019 was a transformative year for MedMen, with over two million completed retail transactions to date and revenues increasing 227% year-over-year,” said Adam Bierman, MedMen co-founder and chief executive officer. “Our success was due, largely in part, to our loyal customer base. Throughout the year, we served over one million customers from all 50 states and more than 100 countries. In California, the largest cannabis market in the world, MedMen surpassed a record $110 million in annualized run-rate retail revenue.”

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 financials for the quarter ended June 29 across MedMen’s operations in California, Nevada, New York, Illinois and Arizona, reporting revenues increased to $42.0 million, up 15% sequentially and 104% year-over-year.

The chart shows 2% tacked on to share pricing for the stock in the past week. What’s more, the listing has witnessed a pop in interest, as transaction volume levels have recently pushed 17% beyond its prior sustained average level.

Mr. Bierman continued, “While industry tailwinds propelled us forward over the past twelve months, changing macroeconomic conditions have led us to refocus our strategy, to reevaluate our assets and to determine where it makes most sense to allocate capital going forward. As we progress into the next fiscal year, our go-forward strategy will therefore focus on three key objectives: optimizing our current retail assets, unlocking the further potential of our factories, and leveraging our omnichannel strategy. As we bring all of our factories online and up to full capacity, and simultaneously optimize our current retail assets across our core geographic markets, we continue on our path toward profitability.”

Now commanding a market cap of $231.7M, MMNFF has roughly $23.7M in cash on the books, which stands against about $84.4M in total current liabilities. One should also note that debt has been growing over recent quarters. MMNFF is pulling in trailing 12-month revenues of $130M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 15%. You can bet we will update this one again as new information comes into view. 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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