Why this latest NR is the kiss of deathSpolier Alert: I get called a basher multiple times on this thread!
So lets start with some brief history.
Back when MJ started its first insane rally NF came to the market with something new, something fresh that told a great story. Penny stocks are all about telling an exciting story and NF did a good job of it. We saw it go from pennies, all the way up to the 30's riding on a paid promotion and the hype. After buying in earlier on I started to do some real research into the company and flags started coming up for me so I sold. Without going on for hours by combing through Washington state data I was able to find NF tenants and find some history on their license numbers which all linked back to NF years and years ago. So essentially years before these tenants were 'signed' there was a connection to NF. Maybe there is an explainable reason, maybe not but it was enough to spook me out of it. They also at that time spun out their Canadian operations to NHS industries which was odd.
Then came the ridiculous revenue projections for 2017 of 24 million.... researching the Washington market it was clear that there was no possible way they could ever come close to achieviing this from 0 to 24 million. Red Flag number 2
I was fascinated with the company and kept following them and posting on here. It was amazing what was going on and the amount of pump teams on the board.
So anyways, like I said penny stocks are largely about telling a good story and they were good at it, very good. This is a big reason why this NR is so damaging.
The latest NR announces the sale of their Oroville Facility which is their largest and most developed facility. They already sold half of their Sumas facility and spun out the Langley property. They seem to be selling it because they want out of the Washington market as it hasn't worked... the story is dead. The story that all the investors have bought NF due to is over and being replaced by a boring story that has been told by many many companies and who are on their way to finishing the book already. The excitement, the belif in the model is all gone.
Now by the numbers... it is interesting because this was basically their only real asset and business and the proposed purchase price (which in my opinion sounds ridiculous) puts a valuation on what the company is worth.
The market cap is 10.2 million or so currently... their largest asset is selling for approximately 3.2 million.
The Langley property is somewhat owned by NF but we dont know the % and has no business yet... its just a property and has a big mortgage on it.
Sumas is only 50% owned and isn't developed as per the financials but is worth 200k. Oroville is apparently selling for about 350% of book value so to be fair we could say Sumas could be worth 700k (doubtful) I dont even know if Sumas has production yet?
So the market cap is 10.2 million... the business are worth about 4 million on the high end and that doesnt even look at debt or anything else. Looks a bit overvalued to me for a company that is selling its businesses and therefore has no more "potential."
Their management does not even have a strong track record so there is no value in them turning around the new companies they are trying to buy.... they ran this one into the ground already.
Healthy companies do not sell off all of their assets and clients so they can start from the ground floor in a new type of business
This is my opinion on it... take a look at these websites as this where I do my research. It tells quite the story if you dig in.
www.502data.com
Sedar
Washington State liquor and MJ control board... tenants are Evergrin, Pams plants, jag 15