Ventura Cannabis and Wellness Corp CVHIF

RE:How will the market react to expansion?

[Xiawen13]

Hi Esther,

I also think management is doing the right thing by growing actual facilities, then moving up revenu and SP, and THEN only raising new money to expand.

By the way, do you guys realize how profitable can become a business where you charge insurers medical rate fees for yoga class and drum lessons! There is no way you can loose money. No wonder insurers try to push back, but this business model has been around for decades and there is simply no alternative. 

Also i found a recent article on the web about drug testing fees.  A patient in detox must be tested many times during the treatment.  The article in question mentionned testing fees of 1000$ per test, and total billing (for drug test ONLY) around 12000$ per patient if I recall properly.  Sorry I dont have the link

DiveEsther wrote:

Hello all,

I'm a long time investor, but new as a contributor to Stockhouse. I know there has been some speculation that Convalo may secure a new site facility in the coming quarter. Keep in mind that their previously stated (earlier) expansion plans were far more aggressive on the growth side. They recently scaled back to ensure they didn't burn through cash on hand, or face a requirement to go to the markets / private equity raise for another cash injection at a ridiculously undervalued share price. I think they recognized that shareholders have suffered enough.

Had Convalo proceeded with further expansion(s) during the past two quarters, the street may have also viewed this as a tremendously risky / negative development (as we have not proven the model and are not yet cash flow positive)... the stock price would have been decimated. Thankfully, we'll never revisit the 0.07 low, nor will it ever drop below .10 for that matter...

My opinion in any case, is that if Convalo were to announce expansion news tomorrow (or any time between now or Q3 results), the market would see this as positive. The metrics of the model are turning around and all signs point to a (near) cash-flow positive upcoming quarter. There's a fine line between "growing" a successful and profitable business, and running one with a stagnant positive income stream. The latter doesn't get investors excited.

This isn't a franchise model, but insiders and shareholders will reap larger rewards, much sooner, if an expansion play is always at the leading edge of profitability.  The "mature" facilities will prove the model is profitable, and so long as you believe the company can bring these expansions up & in-line with the mature facilities... this stock is a knee-slapping no-brainer! This stock will explode -- it's only a matter of time. The patience required is easy for the longs (myself included)... seems like it's the day-traders, flippers, and otherwise short-sighted, impatient investors that are missing out on the real value that is and will be created in this company.

I'm just enjoying these lows to average down my position using every spare dollar of my disposable income (and any loose change I find in my couch). There remains risk here, but the downside is very limited. I'm currently unaware of any other investment opportunity that offers the same degree of risk-factored potential for a huge investment return. I'm very comfortable with the position I've accumulated (which is still in the red) with Convalo and I'm not done yet. Feel free to share your gems of wisdom if you are holding cards at another table, although as I suggested, it would take a lot to convince me to put my money anywhere else right now.

Of course, my opinion only - dyodd.

Esther