The Battle Rages on in KushCo Holdings Inc (OTCMKTS:KSHB)

The Battle Rages on in KushCo Holdings Inc (OTCMKTS:KSHB)

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KushCo Holdings Inc (OTCMKTS:KSHB) just announced that it has expanded its CBD footprint with the launch of a new hemp trading business focused on facilitating legally compliant hemp transactions for in-network, pre-qualified farmers and a pre-qualified buyer network. According to the release, the Company has also entered into a partnership with a leader in U.S. industrial hemp farming, who will serve as a supplier for verified buyers.

“We recognized early on that the CBD market would be an explosive one that is poised for substantial growth for many years to come, which is why we have been actively positioning our business to capitalize on this opportunity,” said Nick Kovacevich, Co-founder, Chief Executive Officer and Chairman of KushCo.

KushCo Holdings Inc (OTCMKTS:KSHB) is the parent company to a diverse group of business units that are transformative leaders in the cannabis, CBD and other related industries. KushCo Holdings’ subsidiaries and brands provide exceptional customer service, product quality, compliance knowledge and a local presence in serving its diverse customer base.

KushCo Holdings’ brands include Kush Bottles, a dynamic sales platform that is the nation’s largest and most respected distributor of packaging, supplies, and accessories, Kush Energy, which provides ultra-pure hydrocarbon gases and solvents to the cannabis and CBD sector, Hybrid Creative, a premier creative design agency for cannabis and non-cannabis ventures, and Koleto Packaging Solutions, the research and development arm driving intellectual property development and acquisitions.

Founded in 2010, KushCo Holdings has now sold more than 1 billion units and regularly services more than 5,000 legally operated medical and adult-use dispensaries, growers, and producers across North America, South America, and Europe. KushCo Holdings subsidiaries maintain facilities in the five largest U.S. cannabis markets as well as having a local sales presence in every major U.S. cannabis market.

According to its materials, “KushCo Holdings, strives to be the industry leader for responsible and compliant products and services in the legal cannabis and CBD industry. The Company has been featured in media nationwide, including CNBC, Los Angeles Times, TheStreet.com, Entrepreneur, and business magazine Inc.  While KushCo Holdings services all facets of the cannabis and CBD industries, it has no direct involvement with the cannabis plant or any products that contain THC or CBD.”

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As noted above, KSHB just announced that it has expanded its CBD footprint with the launch of a new hemp trading business focused on facilitating legally compliant hemp transactions for in-network, pre-qualified farmers and a pre-qualified buyer network.

Traders will note 27% during the past month in terms of shareholder gains in the stock. Moreover, the company has registered increased average transaction volume recently, with the past month seeing 53% over the long run average.

Mr. Kovacevich continued, “We started with the rollout of our Retail Services division this summer, which has been building and activating distribution networks of compliant hemp-derived CBD brands across many retail channels, including the conventional, pet care, convenience, and beauty categories. We believe our partnerships with leading CPG sales agencies is the first large scale go-to-market operation focused on helping these major CBD brands achieve mass distribution across all consumer channels in legal U.S. markets. More recently, we have been offering unique CBD packaging solutions that allow for significant creativity and customization, helping our customers’ brands differentiate themselves on the retail shelves. And now, with the launch of our hemp trading business, we are servicing the entire hemp-derived CBD market from seed to sale, especially as many of our historically THC-focused customers start to expand with unique brands and offerings in the CBD market. We believe this crossover between THC and CBD will continue and with our more than 6,000 customers across both industries, are in prime position to take advantage of the convergence between these two markets. Overall, the hemp trading business will not only expand our CBD footprint and amplify our cross-selling opportunities, but more importantly, will contribute significant EBITDA given its capital light nature, which altogether should help us achieve our goal of adjusted EBITDA profitability in the second half of fiscal 2020.”

At this time, carrying a capital value in the market of $184.7M, KSHB has a significant war chest ($12.2M) of cash on the books, which must be weighed relative to about $29.8M in total current liabilities. One should also note that debt has been growing over recent quarters. KSHB is pulling in trailing 12-month revenues of $121.9M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 221.5%. This is an exciting story, and we look forward to a follow-up chapter as events transpire. Sign-up for continuing coverage on shares of $KSHB 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 $KSHB, either long or short, and we have not been compensated for this article.

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